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In 2009it was 50. In 2013, it had been 25, at the time of writing it's 12.5, and sometime in the center of 2020 it will halve to 6.25. .

At this speed of halving, the total number of bitcoin in circulation will approach a limit of 21 million, making the currency more scarce and valuable over time but also more costly for miners to make.

Here's the catch. In order to get bitcoin miners to actually earn bitcoin from verifying transactions, two things must occur. To begin with, they must verify 1 megabyte (MB) value of transactions, which can theoretically be as small as 1 transaction but are more often several thousand, depending on how much information each transaction stores.

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Second, in order to add a block of transactions to the blockchain, miners must solve a intricate computational math problem, also called a"proof of work" What they are doing is trying to think of a 64-digit hexadecimal number, known as a"hash," that's less than or equal to the target hash.

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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 about 7,184,404,942,701. In other words, the chance of a pc producing a hash beneath the target is just 1 in 7,184,404,942,701 less than 1 in 7 trillion. That amount is adjusted every 2016 cubes, or about every 2 weeks, with the aim of keeping rates of mining constant.

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

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

"Let's say I'm thinking of the number 19. If Friend A guesses 21, they shed because 21>19. look at this site If Friend B supposes 16 and Friend C supposes 12, then they've both technically came 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 that I pose the'imagine what number I am thinking of' question, however I'm not asking only 3 friends, and I'm not thinking of a number home between 1 and 100. Instead, I am asking millions of prospective miners and I'm thinking about a 64-digit hexadecimal number. Now you see that it is going to be quite difficult to guess the right answer." .

If 1 in seven trillion doesn't sound hard enough as is, here's the catch to the grab. Not only do bitcoin miners have to come up with the ideal hash, but they also must be the first to perform it.

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Because bitcoin mining is essentially guesswork, arriving at the right answer before another miner has almost everything to do with how fast your computer can produce hashes. Only a decade ago, bitcoin miners can be performed competitively on normal desktop computers. 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.

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

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

A mining pool is a group of miners that combine their computing ability and divide the mined bitcoin between participants. A disproportionately large 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. .

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

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The bitcoin network can process about see this page seven transactions per second, with transactions being logged in the blockchain each 10 minutes. As the network of bitcoin users continues to grow, however, the number of transactions made in 10 minutes will eventually exceed the number of transactions that can be processed in 10 minutes.

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