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In other words, it is a gamble. .

The difficulty level of the most recent block at the time of writing is about 7,184,404,942,701. That is, the chance of a computer producing a hash below the target is just 1 in 7,184,404,942,701 less than 1 in seven trillion. That level is adjusted every 2016 blocks, or about every two weeks, with the goal of keeping rates of mining constant.

The opposite is also correct. If computational power has been taken off of the network, the problem adjusts downward to earn mining easier. .

"Say I tell three friends that I'm thinking of a number between 1 and 100, and that I write that number on a sheet of paper and seal it in an envelope. My friends don't need to guess the exact number, they simply must be the first person to figure any number that's less than or equal to this number I'm thinking of.

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"Let us say I am thinking of the number 19. If Friend A guesses 21, they lose because 21>19. If Friend B guesses 16 and Friend C supposes 12, then they have both theoretically arrived at viable answers, since 16<19 and 12<19. There's no'extra credit' for Friend B, even though B's answer was closer to the target answer of 19. .

"Now imagine I pose the'imagine what number I am thinking of' question, but I am not asking only three friends, and I'm not thinking of a number between 1 and 100. Instead, I'm asking millions of prospective miners and I am thinking of a 64-digit hexadecimal number. Now you see that it is going to be quite hard to guess the ideal answer." .

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If 1 in seven trillion doesn't sound hard enough as is, here is the grab to the grab. Not only do bitcoin miners need to think of the ideal hash, they also must be the very first to do it.

Since bitcoin mining is essentially guesswork, arriving at the ideal answer before another miner has almost everything to do with how fast your computer can produce hashes. Only a decade ago, bitcoin miners could be performed competitively on normal desktop computers. Over time, however, miners realized that graphics cards commonly used for video games tend to be more effective at mining than desktops and graphics processing units (GPU) came to dominate the game.

These can run from $500 to the tens of thousands. .

Nowadays, bitcoin mining is so competitive it can only be done profitably using all the most up-to-date ASICs. When using desktop computers, GPUs, or elderly versions of ASICs, the expense of energy consumption actually surpasses the revenue generated. Even with the newest unit available, one pc is seldom enough to compete with what what miners call"mining pools." .

An mining pool is a group of miners who combine their computing power and split the mined bitcoin between participants. A disproportionately high number of cubes are mined by pools rather than by individual miners. In July 2017, mining pools and companies represented roughly 80% to 90 percent of bitcoin computing power. .

Between 1 in 7 trillion odds, scaling difficulty levels, and also the huge network of users verifying transactions, one block of transactions is verified roughly every 10 minutes. However, its important to keep in mind that 10 minutes is a goal, not a guideline.

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The bitcoin network can process about seven transactions per second, with transactions being logged in the blockchain every 10 minutes. Since the network of bitcoin consumers continues to grow, but the number of transactions made in 10 minutes will eventually exceed the number of transactions that can be processed in 10 minutes.

This dilemma at the heart of the bitcoin protocol is known as scaling. Even though bitcoin miners generally agree that something must be done in order to address scaling, there is less consensus regarding how do it. In the time of writing, there are two big solutions click for source to the scaling problem, either (1) to lower the amount of data needed to verify each block or (2) to increase the number of transactions that every block can store.

Solution 2 will cope with scaling by allowing for more information to be processed every 10 minutes. .

In July 2017, bitcoin miners and mining companies representing approximately 80% to 90% of their networks computing power required to incorporate a More Bonuses program that would reduce the amount of information needed to verify each block. In other words, they went with Solution 1.

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The program which miners voted to increase the bitcoin protocol is called a segregated witness, or SegWit. This expression is an amalgamation of Segregated, meaning to separate, and Witness, which describes signatures on a bitcoin transaction. Segregated Witness, then, means to separate transaction signatures out of a block and join them as an extended block.