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

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

Here is the catch. In order for bitcoin miners to really earn bitcoin from verifying transactions, two things must occur. To begin with, they must verify 1 megabyte (MB) worth of transactions, which can technically be as small as 1 transaction but are far more often a few thousand, depending on how much information each transaction shops.

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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're doing is trying to think of a 64-digit hexadecimal number, called a"hash," that is 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. That is, the chance of a pc producing a hash beneath the goal is 1 in 7,184,404,942,701 less than 1 in 7 trillion. That amount is adjusted every 2016 cubes, or about every two 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 this 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 sheet of paper and seal it in an envelope. My friends don't have to guess the exact number, they simply must be the very first person to guess any number that is less than or equal to this number I'm thinking of.

"Let's say I am thinking about the number 19. If Friend A guesses 21, they shed because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they have both technically came at workable answers, since 16<19 and 12<19. There is no'extra credit' for Friend B, even though B's answer was closer to the goal answer of 19. .

"Now imagine I present the'guess what number I'm thinking of' question, however I am not asking only three friends, and I'm not thinking of a number between 1 and 100. Instead, I am asking millions of would-be miners and I am thinking her comment is here about a 64-digit hexadecimal number. Now you see that it's going to be extremely hard 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 need to think of the right hash, they also must be the very first to do it.

Because 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 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 match.

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

Nowadays, bitcoin mining is so aggressive it can only be done profitably with the latest up-to-date ASICs. When using desktop computers, GPUs, or elderly models of ASICs, the cost of energy consumption actually exceeds the revenue generated. Even with the newest unit available, one computer is seldom enough to compete with what what miners call"mining pools" .

An mining pool is a group of miners who combine their computing ability and split the mined bitcoin between participants. A disproportionately large number of cubes are mined by pools rather than by individual miners. In July 2017, mining pools and that site 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 massive network of consumers verifying transactions, one block of transactions is verified roughly every 10 minutes. But its important to keep in mind that 10 minutes is a target, not a guideline.

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