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In other words, it is a bet. .

The difficulty level of the most recent block at the time of writing is all 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 amount is adjusted every 2016 cubes, or about every 2 weeks, with the goal of keeping rates of mining constant.

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

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

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"Let's say I am thinking about the number 19. If Friend A guesses 21, they shed because 21>19. If Friend B supposes 16 and Friend C supposes 12, then they have both technically came at workable answers, because 16<19 and 12<19. There is no'extra credit' for Friend B, even though B's answer was closer to the goal answer of 19. .

"Now imagine I present the'guess what number I am thinking of' question, however I am not asking only 3 friends, and I am not thinking of a number between 1 and 100. Instead, I am asking millions of prospective miners and I am thinking about a 64-digit hexadecimal number. Now you see that it's going to be extremely hard to guess the ideal answer." .

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If 1 in 7 trillion doesn't sound difficult enough as is, here is the catch to the grab. Not only do bitcoin miners need to think of the ideal hash, they also have to be the very first to perform it.

Because bitcoin mining is essentially guesswork, arriving at the right answer before another miner has everything to do with how fast your computer can create hashes. Just a decade ago, bitcoin miners can be performed competitively on normal desktop computers. check out here As time passes, however, miners recognized 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 into the tens of thousands. .

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

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

Between 1 in 7 trillion chances, scaling difficulty levels, and the huge network of consumers verifying transactions, one block of transactions is verified roughly every 10 minutes. However, its important to remember that 10 minutes is a target, not a rule.

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The bitcoin network can process about seven transactions per second, with transactions being logged in the blockchain every 10 minutes. As the network of bitcoin consumers continues to grow, however, the number of transactions made in 10 minutes will eventually exceed the number of transactions which 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 has to be done to address scaling, there is less consensus regarding how do it. At the time of writing, there are two big solutions to this scaling problem, either (1) to decrease the amount of data needed to confirm each block or (2) to increase the number of transactions that every block can store.

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

In July 2017, bitcoin miners and mining companies representing approximately 80% to 90% of the networks computing electricity required to incorporate a program that will decrease the amount of data needed to verify each block. In other words, they went with Solution 1.

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The app which miners voted to increase the bitcoin protocol is known as a segregated witness, or SegWit. This term is an amalgamation of Segregated, meaning to separate, and Witness, which refers to signatures on a bitcoin transaction. Segregated Witness, then, means to separate transaction signatures from a block and attach them as an extended block.