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In other words, it's a gamble. .

The difficulty level of the most recent block at the time of writing is all about 7,184,404,942,701. In other words, the chance of a pc producing a hash below the goal is just 1 in 7,184,404,942,701 less than 1 in seven trillion. That amount is corrected every 2016 blocks, or roughly every 2 weeks, with the goal of keeping rates of mining constant.

The opposite is also true. 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 about a number between 1 and 100, and I write that number on a piece of paper and seal it in an envelope. My friends don't need to guess the exact number, they just must be the first person to guess any number that's less than or equal to this number I am thinking of.

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"Let us say I am thinking of the number 19. If Friend A guesses 21they shed because 21>19. If Friend B supposes 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 nearer to the target answer of 19. .

"Now imagine I present the'guess what number I am thinking of' question, but 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 would-be miners and I am thinking of a 64-digit hexadecimal number. Now you see that it is going to be quite difficult to guess the right answer." .

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

Since bitcoin mining is essentially guesswork, arriving at the ideal answer before another miner has everything to do with how fast your computer can create hashes. Only a decade ago, bitcoin miners could be carried out competitively on normal desktop computers. As time passes, however, miners realized that graphics cards commonly used for video games were more capable of mining than desktops and graphics processing units (GPU) came to dominate the match.

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

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

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

Between 1 in 7 trillion odds, scaling difficulty levels, and also the massive network of consumers verifying transactions, one block of transactions is verified roughly every 10 minutes. But its important to remember that 10 minutes is a directory 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 each 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 which can be processed in 10 minutes.

This dilemma at the heart of the bitcoin protocol is known as scaling. While bitcoin miners generally agree that something has to be done in order to deal with scaling, there is less consensus regarding how can it. In the time of writing, there are two big solutions to this scaling problem, either (1) to lower the amount of information needed to confirm each block or (2) to increase the number of transactions that every block can store.

Solution 2 would deal with scaling by allowing for much 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 confirm each block. In other words, they went with Solution 1.

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The find more app which miners voted to add to the bitcoin protocol is known as a segregated witness, or SegWit. This term 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 attach them as an extended block.