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Legitimate miners and buyers have to incur substantial production and energy costs, or have to pay the going exchange rates for bitcoins.
Criminal miners pay nearly nothing for its production of new coins, outsourcing the work to hapless victim machines all over the world. Criminal bitcoin thieves don't incur the exchange rate cost for acquisition of bitcoins. They simply rely on hacking and malware to siphon bitcoin wallets from law-abiding owners.
What we've got here, then, is a commodity (I hesitate to call it a currency) with a current value, is absolutely free from regulation (for the moment), allows for completely anonymous ownership, and is both highly rewarding and nearly free to produce (if you are willing to violate the law).
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There's no doubt the bitcoin has staying power, but if that's only among criminals (and those who would like to traffic with them, like the Silk Road medication sellers and customers), or if it will become a valuable trading commodity for the rest of us remains unclear.
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My advice to law enforcement is easy: follow the bitcoin. There's no doubt that more and more criminals will be using bitcoin to generate gain in addition to pay their tracks. Whenever you find a stash of bitcoin and possess judicial permission to follow the footprints, do this.
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While bitcoin usage is not confined to criminals, there's an undeniably high correlation between bitcoin ownership and criminal activity. Especially since bitcoins are becoming increasingly more rewarding to criminal malware seeders and botnet operators while concurrently becoming ever less profitable for legitimate traders.
Here's the vital take-away: bitcoins are becoming the most"national currency" of criminals the world over and are becoming an increasingly inadequate investment for legitimate miners.
Cryptocurrency mining is painstaking, expensive, and only sporadically rewarding. Nonetheless, mining has a magnetic attraction for many investors interested in cryptocurrency. This may be because entrepreneurial forms see mining as pennies from heaven, like California gold prospectors in 1848. And If You're technologically inclined, why not take action
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Before you invest time and equipment, read this explainer to find out whether mining is for you. We'll focus primarily on Bitcoin. (Related: How Bitcoin Works and our helpful infographic, What is Bitcoin)
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By mining, you can earn cryptocurrency without having to put down money for this. That said, you certainly don't need to become a miner to own crypto.  You can also purchase crypto using fiat currency (USD, EUR, JPY, etc); you can trade it on an exchange like Bitstamp using other crypto (instance: Using Ethereum or NEO to purchase Bitcoin); you even can earn it by playing video games or even by publishing blogposts on programs which pay its consumers in crypto.
In addition to lining the pockets of miners, mining serves a second and vital purpose: It is the only way to release new cryptocurrency into circulation. In other words, miners are essentially"minting" currency. By way of instance, at the time of writing this piece, there were about 17 million Bitcoin in circulation.
In the absence of miners, Bitcoin would still exist and be usable, but there would never be any additional Bitcoin. There will come a time when Bitcoin mining ends; each the Bitcoin Protocol, the number of Bitcoin will likely be capped at 21 million. (Related reading:Â What Happens to Bitcoin After All 21 Million are Mined).
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Besides the short-term Bitcoin payoff, being a miner can give you"voting" power when changes are suggested in the Bitcoin protocol. In other words, an effective miner has influence on the decision-making process on these issues as  forking.
Bitcoin are mined in units called"cubes" At this time of writing, the reward for completing a block is 12.5 Bitcoin. At today's cost of about $10,000 each Bitcoin, this means you'd earn (12.5 x 10,000)$125,000.
When Bitcoin was mined in 2009, mining one block would earn you 50 BTC. In 2012, this was halved to 25 BTC. In 2016, this was halved into the current level of 12.5 BTC. In 2020 or so, the payoff size will be halved again to 6.25 BTC.
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If you want to keep track of precisely when these halvings will occur, you can consult with the Bitcoin Clock, which updates this information in real time.
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Miners are getting paid for their work as auditors. They are doing the job of verifying previous Bitcoin transactions. This convention is meant to like this maintain Bitcoin users honest, and was conceived by Bitcoin's founder, Satoshi Nakamoto. By verifying transactions, miners are helping prevent the"double-spending issue."