Given that Bitcoin’s value comes from the digital scarcity of its currency, and the way it ensures against double spend, the mining process has to be difficult and incentivise honest behaviour. This is achieved through something called Proof of Work (Pow).
PoW requires Miners to compete against each other to earn the right to broadcast their candidate block to the network by solving a mathematical puzzle.
Full Nodes automatically adjust the difficulty of finding the solution to the puzzle – every 2,016 blocks – ensuring the required amount of computational power has been expended to ensure a new block is created every 10 minutes, regulating issuance in line with the maximum supply.
While the puzzle itself is meaningless, the work required to arrive there is not: it proves that the miner hasn’t cheated, and ensures that no single entity can discover all of the blocks – keeping all the bitcoin rewards to themselves – or removing transactions, which would bring the whole system to a halt.
PoW is therefore integral to the process of maintaining digital scarcity, and improving on the current failings of the fiat system, with its infinite supply.
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