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In other words, it is a bet. .
The opposite is also true. If computational power is taken off of this network, the problem adjusts downward to make mining simpler. .
"Say I tell three friends that I'm thinking of 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 just have to be the first person to figure any number that's less than or equal to the number I am thinking of.
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"Let us say I am thinking about the number 19. If Friend A guesses 21they shed because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they have both technically came at viable answers, because 16<19 and 12<19. There is no'extra credit' for Friend B, even though B's answer was closer to the target answer of 19. .
"Now imagine that I present the'imagine what number I am thinking of' question, however I am not asking only three friends, and I'm not thinking of a number between 1 and 100. Rather, I'm asking millions of prospective miners and I am thinking about a 64-digit hexadecimal number. Now you see that it's going to be extremely hard to guess the right answer." .
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If 1 in 7 trillion doesn't sound difficult enough as is, here is the catch to the catch. Not only do bitcoin miners need to come up with the right hash, but they also have to be the very first to do it.
Because bitcoin mining is essentially guesswork, arriving at the ideal answer before another miner has almost everything to do with how fast your computer can create hashes. Just a decade ago, bitcoin miners can be performed competitively on normal desktops. As time passes, however, miners recognized that graphics cards commonly used for video games tend to be more capable of mining than desktops and graphics processing units (GPU) came to dominate the game.
These can run from $500 into the tens of thousands. .
Today, bitcoin mining is so aggressive that it can only be done profitably using the most 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 available, one computer is rarely enough to compete with exactly what miners call"mining pools." .
An mining pool is a group of miners who combine their computing ability and divide 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 companies represented roughly 80% to 90 percent of bitcoin computing power. .
Between 1 in 7 trillion odds, scaling difficulty levels, and the huge 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 goal, not a rule.
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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 consumers 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 issue at the center of the bitcoin protocol is known as scaling. Even though bitcoin miners generally agree that something must be done to deal with scaling, there is less consensus regarding how do it. At the time of writing, there are two big solutions to the scaling problem, either (1) to decrease the amount of information needed to confirm each block or (2) to increase the number of transactions that each block can save.
Solution 2 will deal with scaling by allowing for much more information to be processed every 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 information needed to verify each block. In other words, they went with Solution 1.
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The program that miners voted to add to the bitcoin protocol is called a segregated witness, or SegWit. This term is an amalgamation of Segregated, meaning to different, and Learn More Witness, which refers to signatures on a bitcoin transaction. Segregated Witness, then, means to separate transaction signatures from a block and attach them within an extended block.