Bitcoin mining

ANGLICANPAT

Thanks everyone ,really appreciate the time put in to helping me understand, considering  it's only for my curiosity .    I think I've got the basics of it now . Good job though Im not thinking of going into it , as the only part I see myself being successful at  , is the making a  hash of it  bit . (To  coin a suitable phrase )

Mistral001

As far as I can see the Bitcoin system depends on the infrastructure which runs it.  I believe there are over a 100,000 machines ("mining" computers) totally dedicated to validating transactions for Bitcoin.  If these machines cost say £5000 each, then that means the cost of the infrastructure is in the range of £500M.  This is a vast sum and add the cost of electricity which is about 3kW per machine (three bar electric heater) then the whole system looks very very expensive for something that is often hailed as a way of making transactions without fees. 

Another point regarding this infrastructure is that a large scale attack on the system would probably require getting control of a least 50% of this infrastructure and that is what makes the system secure.   It is the cost of this infrastructure that is important.  As computers to "mine" the Bitcoin become less expensive, then the complexity of the validation process must be increased so that the cost of the computer infrastructure continues to stay high enough to deter a determined hacker.  So it would seem that the system inherently depends on this expensive intrastructure to be secure and cannot really be made more economical.