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Proof-of-Work

Bitcoin transactions are processed through a highly competitive system of proof-of-work hashing, aka mining. This is also, coincidentally, how Bitcoin is issued and how issuance stays on a fixed supply schedule -- which is how the total supply of Bitcoin will remain fixed, forever.

While most people will be saving and spending in Bitcoin, very few will be involved in mining, and far fewer will be successful. Ultimately, the mechanism that guarantees final international settlement (mining) is a highly competitive (and adversarial) zero sum game.

For those foolish enough to play this game -- and for some it's more a matter of fate than want -- the only way to be successful is a combination of competence, luck, and by far the most important: a ridiculous work ethic.

Proverbs 10:4

Always poor is he who works with an indolent hand, but the hand of the diligent brings wealth

If you're looking for passive income or an exciting investment opportunity, Bitcoin mining is most certainly not for you. However, if honest hard work is just your kind of game, well then -- welcome to the arena. Proof-of-work hashing is what gives Bitcoin its security, and what allows for final international settlement. And while it is adversarial and zero-sum, it is open to everybody. Anyone can attempt to find and propagate blocks. In fact, to truly gain your own financial sovereignty, then mining your own blocks guarantees you can settle your own on-chain transactions.

Sovereignty Levels

  • Level 1: Network Reliance -- Run a full node and independently validate blocks, securing your own setup without mining. Simple for individuals or communities in shaky economies, but transaction settlement depends on others.

  • Level 2: Lottery Mining -- Use a low-power ASIC like BitAxe connected to a solo pool (e.g., solo.ckpool.org or public-pool.io). Affordable and low-energy for self-sufficient hashing.

  • Level 3: Small Farm -- Run a snall farm of ASICs aimed at a solo pool to boost your block-finding odds and build community strength. Good for families mining independently.

  • Level 4: Sovereign Pool -- Host your own stratum server linked to your own node for a fully private solo pool. Can also filter transaction spam from your node's block templates.

  • Level 5: Enterprise Scale -- Set up mid-sized mining farm with sufficient hashrate to see a block every few months.

  • Level 6: Industrial Scale -- Manage massive minng farms with sufficient hashrate to see blocks every week or even daily.

  • Level 7: Inevitable Future -- Emerging tech makes hashrate seamless from any device, barrier-free for everyone. Delivers true sovereignty worldwide.

Before diving-in and daring to test your fate in the Bitcoin mining arena, you may want to first understand the terms.