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I'm new to the whole bitcoin stuff.
The stuff I've read about mining so far told me that when a node in blockchain finally finds the correct nonce for a block that can be accepted in blockchain, it then advertises it to others and they verify and put the block to the blockchain (at least this is what i understood from the explainations). I have also read that prize for mining a block is 12.5 BTC.
My question here is how do nodes mine a fraction of a bitcoin when mining?(shouldn't it be 12.5 BTC per mined block for each node? is it even possible?)

Example: this

Answer to this question mentions 0.04 BTC,but how?

  • The current smallest unit of value in Bitcoin is a satoshi which is equal to 10^(-8) bitcoins. So when you say, the mining reward is 12.5 BTC, it is essentially 1,250,000,000 satoshis. – Ugam Kamat Jun 24 at 7:52
  • @UgamKamat so a node either mines 12.5 BTC or doesn't mine anything at all? – Abol_Fa Jun 24 at 7:59
  • When a miner successfully mines a block, it gets the block reward + the fees of all the transactions in the block. The current block reward is 12.5 BTC. The first one to find the block header hash that matches is lower than the target hash at current difficulty, gets the block rewards – Ugam Kamat Jun 24 at 8:08
  • A node is not necessarily a miner. Not all nodes are miners, but all miners are nodes (at least they should be). – Andrew Chow Jun 26 at 3:49
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You either mine a full block...

-> Then you're free to take the full 12.5 BTC reward or less, at your choice.

Or..

-> You can mine with a pool. Everyone in that pool calculate hashes of trivial amounts, but their sum will be enough to mine blocks. Then, the pool will reward your work. (Search for PPS or PPLNS)

  • Is/can 'mining pool' implemented/be in the bitcoin protocol or a node with some bitcoins 'hires' a pool of node to the work and then splits the share? – Abol_Fa Jun 24 at 8:19
  • A pool operator (that rich person) has a node. The node has a stratum (the mining protocol) end, using which miners (ASICs, FPGAs,... but not other nodes) can connect. The node assigns them templates. The miners try hashing them, and they share the results with the pool. The node publishes the block if the hash is valid for the network. At regular intervals the node sends payouts to miners. – MCCCS Jun 24 at 8:30

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