<p><strong>Bitcoin Mining<br> </strong><br> The bitcoin system of trust is based on computation. Transactions are bundled into</p> <p>blocks, which require an enormous amount of computation to prove, but only a small</p> <p>amount of computation to verify as proven. The mining process serves two purposes</p> <p>in bitcoin:</p> <p>• Mining nodes validate all transactions by reference to bitcoin’s consensus rules.</p> <p>Therefore, mining provides security for bitcoin transactions by rejecting invalid</p> <p>or malformed transactions.</p> <p>• Mining creates new bitcoin in each block, almost like a central bank printing new</p> <p>money. The amount of bitcoin created per block is limited and diminishes with</p> <p>time, following a fixed issuance schedule.</p>