Bitcoin has a limited supply of 21 million that creates a "built-in scarcity". Moreover, this scarcity enables Bitcoin to hold the cryptocurrency for long term because it is limited. As demand increases, the price of bitcoin will increase as well. Therefore, unlike Dogecoin, investors choose to hold bitcoin over a longer duration.
There are four main types to mine for Bitcoin:
1. Cloud mining: Cloud mining is a mechanism to mine any cryptocurrency by using rented cloud computing power and not having to install it. One can directly run the hardware and the related software. The Cloud mining firms enable people to open their account and remotely participate in the process of cryptocurrency mining for a basic cost. This makes mining accessible to a broader number of people around the globe. Since this form of mining is done via cloud, it reduces issues of maintenance of the equipment or direct energy costs.
2. CPU mining: CPU means central processing unit, and it's believed to be the brain of a computer because it controls all the operations for all parts. CPUs perform all sorts of data processing operations, and without CPUs, a computer will not work properly. In the initial days of Bitcoin, one could mine it on its CPU. Later on, as mining became more competitive, this method wasn’t feasible. However, there are other blockchains, which can be mined using the CPU today.
3. GPU mining: GPU mining includes the use of a gaming computer's graphics processing unit to resolve intricate math problems to verify electronic transactions on a blockchain. Usually, to mine a cryptocurrency such as Bitcoin and Dogecoin, the digital coins has to be built on a blockchain architecture that supports proof-of-work (PoW) mining.
4. ASIC mining: The ASIC, an application-specific integrated circuit, is a chip that is used only for one purpose. In the beginning, it was possible to mine Bitcoin using a CPU/GPU, but as it got more competitive this method changed. Today, ASIC chips are used to mine Bitcoin. In fact, the majority of the large-scale blockchain mines run on ASIC machines because these machines are purpose-built. They prove to be more reliable and effective at mining.