Peer To Peer Bitcoin - Questions

If you are mining Bitcoin, you do not need to figure the total value of that 64-digit number (the hash). I repeat: You do not need to figure 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 terms, that metaphorical undisclosed number in the envelope is called the target hash.

What miners are doing with these huge computers and dozens of cooling fans is guessing at the hash. Miners create these guesses by randomly generating as many"nonces" as you can, as quickly 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 first miner whose nonce generates a hash that is less than or equivalent to the target hash is awarded credit for completing that obstruct, and is given the spoils of 12.5 BTC. .

In theory you can achieve the Exact Same aim by rolling a 16-sided expire 64 days to Reach random numbers, but why on earth would you want to do this

The screenshot below, taken by the site Blockchain.info, might help you put all this information together in a glance. You are looking at a list of everything that happened when block #490163 was mined. The nonce that generated the "winning" hash was 731511405. The target 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 see all 1768 of those transactions for this block, then go to this webpage and scroll down to the heading"Transactions." .

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

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

You'd have to get a fast mining rig or, more realistically, join a mining pool--a bunch of miners that combine their computing power and split the mined bitcoin. Mining pools are somewhat comparable to people Powerball clubs whose members buy 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 is literally just 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--less than 1 in two trillion. .

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The aforementioned site Cryptocompare offers a helpful calculator which permits you to plug in numbers like your hash rate, power costs Visit Website etc. to gauge the costs and benefits.

Mining rewards are paid into the miner who discovers a solution to the puzzle , and also the likelihood that a participant is going to be the one to discover the solution is equivalent to the portion of the entire mining power on the network.  Participants with a small percentage of the mining power stand a very small chance of discovering the next block on their own.  For instance, a mining card that one could buy to get a couple thousand bucks would represent less than 0.001percent of the 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 difficulty going up makes things even worse.  The miner may never recoup their investment.  The answer to this problem is mining pools.  Mining pools are operated by third parties and coordinate groups of miners.  By working together in a swimming pool and sharing the payouts amongst participants, miners can find a steady flow of bitcoin starting the day that they activate their miner.  Statistics on some of the mining pools can be seen on Blockchain.info. .

Sure. As mentioned, the easiest way to acquire Bitcoin is to buy it on an exchange like Coinbase.com. Alternately, you use this link can consistently leverage the"pickaxe strategy". This relies on the old saw that during the 1848 California gold rush, the smart investment was not to pan for goldbut rather to make the pickaxes used for mining.

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