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In other words, it is a gamble. .

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

The opposite is also true. If computational power is taken off of the network, the problem adjusts downward to earn mining simpler. .

"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 specific number, they simply have to be the first person to guess any number that's less than or equal to this number I'm thinking of.

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"Let's say I am thinking of the number 19. If Friend A guesses 21, they 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 closer to the target answer of 19. .

"Now imagine that I pose the'guess what number I am thinking of' question, but I'm not asking only 3 friends, and I am not thinking of a number between 1 and 100. Rather, I'm asking millions of would-be miners and I'm thinking of a 64-digit hexadecimal number. Now you see that it's going to be quite difficult to guess the ideal answer." .

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If 1 in 7 trillion doesn't sound difficult enough as is, here is the grab to the catch. Not only do bitcoin miners have to think of the right hash, they also must be the 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 could be performed competitively on normal desktop computers. As time passes, however, miners realized that graphics cards commonly utilized for video games were more capable of mining than desktops and graphics processing units (GPU) came to dominate the match.

These can run look at this now from $500 to the tens of thousands. .

Today, bitcoin mining is so aggressive it can only be done profitably using the most 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 pc 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 split the mined bitcoin between participants. A disproportionately large 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 massive network of users verifying transactions, one block of transactions is verified roughly every 10 minutes. However, 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 every 10 minutes. As the network of bitcoin users continues to grow, but 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. Even though bitcoin miners generally agree that something must be done in order to address scaling, there is less consensus about how can it. In the time of writing, there are two big solutions to the scaling problem, either (1) to lower the amount of data needed to verify each block or (2) to increase the number of transactions that every block can save.

Solution 2 would deal with scaling by allowing for more information to be processed each 10 minutes. .

In July 2017, bitcoin miners and mining companies representing roughly 80% to 90% of their networks computing electricity required to incorporate a program that will reduce the amount of data needed to confirm each block. That is, they went with Solution 1.

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The app which miners voted to add to the bitcoin protocol is called a segregated witness, or SegWit. This expression is an amalgamation of Segregated, meaning to different, and Witness, which refers to signatures on a bitcoin transaction. Segregated Witness, then, means to separate transaction signatures out of a block and join them as an extended block.