Excitement About Bitcoin Mining Efficiency

If you're mining Bitcoin, you do not need to calculate the entire value of the 64-digit number (the hash). I repeat: You do not need to calculate the entire value of a hash.

Bear in Mind that ELI5 analogy, where I composed the number 19 on a piece of paper and put it in a sealed envelope

In Bitcoin mining conditions, that metaphorical undisclosed number in the envelope is called the objective hash.

What miners are doing with those tremendous computers and dozens of cooling fans is guessing at the hash. Miners make these guesses by randomly generating as many"nonces" as you can, as fast as possible. A nonce is short for"number only used once," and also the nonce is the key to generating these 64-bit hexadecimal numbers I keep talking about.

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The primary miner whose nonce generates a hash which is less than or equivalent to the target hash is awarded credit for completing that block, and is awarded the spoils of 12.5 BTC. .

In theory you can achieve the Exact Same goal by rolling a 16-sided die 64 times to Reach random numbers, but why on earth do you want to do that

The screenshot below, taken from the site Blockchain.info, might enable you to put all this information together at a glance. You're looking at a summary of everything that happened when obstruct 490163 was mined. The nonce that generated the "winning" hash was 731511405. The goal hash is shown on the top.

As you see here, their contribution into the Bitcoin community is that they confirmed 1768 transactions for this block. If you truly want to find all 1768 of these transactions for this block, go to this webpage and scroll down to the heading"Transactions." .

There is no minimum goal, but there's a maximum target set by the Bitcoin Protocol. No target can be higher than this number:

Here are some examples of randomized hashes and also the standards for whether they will lead to success for the miner:

You would need to find a speedy mining rig , more realistically, join a mining pool--a bunch of miners who combine their computing power and split the mined bitcoin. Mining pools are similar to people Powerball clubs whose members helpful resources purchase lottery tickets en masse and agree to share any winnings. A disproportionately large number of blocks are mined by pools rather than by individual miners. .

In other words, it's literally only a numbers game.  You cannot imagine the pattern or make a prediction based on preceding goal hashes. The difficulty level of the most recent block at the time of writing is 2,874,674,234,416, i.e. the chance of any given nonce producing a hash below the target is 1 in 2,874,674,234,416--significantly less than 1 in two trillion. .

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The aforementioned site Cryptocompare delivers a helpful calculator which allows you to plug in numbers like your hash rate, power costs etc. to estimate the costs and benefits.

Mining benefits are paid to the miner who finds a solution to the puzzle first, and also the probability that a participant will be the one to find the solution is equal to the portion of the total mining energy on the network.  Participants with a small percentage of the mining capability stand a very small chance of discovering the next block on their own.  For instance, a mining card that one could purchase to get a few thousand dollars would represent less than 0.001% of their network's mining power.  With such a tiny chance at finding the next block, it might be a long time before that miner finds a block, and the problem going up makes things even worse.  The miner may never recoup their investment.  The answer to this problem is mining pools.  Mining pools are run by third parties and coordinate groups of miners.  By working together in a swimming pool and sharing the payouts amongst participants, miners can get a steady flow of bitcoin starting the afternoon that they trigger their miner.  Statistics on some of the mining pools can be seen on Blockchain.info. .

Sure. As discussed, the simplest way to get Bitcoin is to purchase it on an exchange such as Coinbase.com. Alternately, you can consistently leverage the"pickaxe plan". This relies on the old saw that during the 1848 California gold rush, the smart investment was not to pan for gold, but rather to create the pickaxes taken for mining.

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In a crypto context, the pickaxe equivalent are a company that manufactures equpiment utilized for Bitcoin mining. You can start looking into companies which make ASICs miners or GPU miners. .