Setting the Scene: Conflicting Transactions
In the previous lesson, we looked at a scenario where two transactions (one "purple," one "red") tried to spend the same bitcoin. Different nodes on the network held conflicting versions of this transaction.
So, how do all the computers in the Bitcoin network agree on which transaction is valid?
That's where mining comes in.
A Closer Look Inside a Bitcoin Node
Let's zoom in on one of these computers.
This one is not just any node—it's a miner.
So, What Is a Bitcoin Miner?
A Bitcoin miner is a special type of full node. Like other full nodes, it:
- Stores a complete copy of the blockchain
- Verifies and shares transactions
But a miner goes one step further. It also:
- Selects unconfirmed transactions from the memory pool
- Groups them into a block
- Competes with other miners to add that block to the blockchain
All miners are full nodes, but not all full nodes are miners.
To perform mining, a node needs specialized hardware—a regular computer isn't enough.
How Does a Miner Actually "Mine"?
Let's take a peek inside a miner and see what it's doing.
First, it accesses its memory pool, which stores incoming unconfirmed transactions.
Since memory pool space is limited, and block size is capped, miners must be selective. They typically prioritize transactions offering the highest fees.
Introducing the "Candidate Block"
The miner takes transactions from its memory pool and places them into a temporary container called a candidate block.
What's a candidate block?
It's a proposed block filled with selected transactions, but it's not yet officially part of the blockchain. It only becomes valid if the miner successfully adds it to the chain.
The miner continues filling the candidate block with as many high-priority transactions as it can fit.
What Happens Next?
Once the candidate block is ready, the miner attempts to add it to the blockchain.
But how does that actually happen?
That's what we'll explore in the next lesson—where we dig into the actual mining process and what it takes to win the race to confirm a block.