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In other words, it's a bet. .
The reverse is also correct. If computational power has been taken from this network, the problem adjusts downward to earn mining easier. .
"Say I tell three friends I'm thinking about 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 have to be the first person to guess any number that is less than or equal to the number I am thinking of.
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"Let us say I'm thinking of the number 19. If Friend A guesses 21, they lose because 21>19. If Friend B guesses 16 and Friend C guesses 12, then they have 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 nearer to the target answer of 19. .
"Now imagine that I present the'guess what number I'm thinking of' question, but I'm not asking just three friends, and I am not thinking of a number between 1 and 100. Rather, I am asking millions of prospective miners and I am thinking about a 64-digit hexadecimal number. Now you see that it is going to be extremely difficult to guess the ideal answer." .
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If 1 in seven trillion doesn't sound difficult enough as is, here's the catch to the grab. Not only do bitcoin miners need to think of the right hash, but they also have to be the first to perform it.
Since bitcoin mining is essentially guesswork, arriving at the right answer before another miner has almost everything to do with how fast your computer can create hashes. Only a decade ago, bitcoin miners could be performed competitively on normal desktops. Over time, however, miners recognized that graphics cards commonly used for video games were more effective at mining than desktops and graphics processing units (GPU) came to dominate the match.
These can run from $500 into the tens of thousands. .
Today, bitcoin mining is so competitive that it can only be done profitably using all the latest up-to-date ASICs. When using desktop computers, GPUs, or older models of ASICs, the expense of energy consumption actually exceeds 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 who combine their computing ability and divide 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 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 confirmed roughly every 10 minutes. However, its important to keep in mind 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 each 10 minutes. Since 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.
This dilemma at the center of the bitcoin protocol is known as scaling. While bitcoin miners generally agree that something must be done to address scaling, there is less consensus about how do it. At the time of writing, there are two major solutions to this scaling problem, either (1) to decrease the amount of data needed to verify each block or (2) to increase the number of transactions that every block can save.
Solution 2 will cope with scaling by allowing for much more information to be processed each 10 minutes. .
In July read the full info here 2017, bitcoin miners and mining companies representing approximately 80% to 90% of their networks computing electricity voted to incorporate a program that would reduce the amount of information needed to confirm each block. imp source That is, they went with Solution 1.
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The program which miners voted to add to the bitcoin protocol is called a segregated witness, or SegWit. This term is an amalgamation of Segregated, meaning official source 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.