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In 2009, it had been 50. In 2013, it had been 25, in the time of writing it is 12.5, and sometime in the center 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 precious over time but also more expensive for miners to make.
Here is the catch. In order to get bitcoin miners to really earn bitcoin from verifying transactions, two things must occur. First, they need to verify 1 megabyte (MB) value of transactions, which can theoretically be as little as 1 transaction but are far more often a few thousand, depending on how much data each transaction stores.
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Second, in order to add a block of transactions to the blockchain, miners must fix a complex computational math problem, also called a"proof of work" What they're doing is trying to come up with a 64-digit hexadecimal number, called a"hash," that is less than or equivalent to the hash.
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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 target is just 1 in 7,184,404,942,701 less than 1 in 7 trillion. That level is adjusted every 2016 cubes, or about every 2 weeks, with the goal of keeping rates of mining constant.
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The opposite is also correct. If computational power is taken off of this network, the problem adjusts downward to earn mining easier. .
"Let's say I am thinking about the number 19. If Friend A guesses 21they lose because 21>19. If Friend B guesses 16 and Friend C guesses 12, then they have both anonymous 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 nearer to the target answer of 19. .
"Now imagine I pose the'imagine what number I am thinking of' question, but I'm not asking only three friends, and I am not thinking of a number between 1 and 100. Rather, I am asking millions of would-be 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 right answer." .
If 1 in 7 trillion doesn't sound hard enough as is, here's the catch to the grab. Not only do bitcoin miners have to come up with the right hash, they also must be the very first to do it.
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These can run from $500 to the tens of thousands. .
Nowadays, bitcoin mining is so aggressive that it can only be done profitably using all the most up-to-date ASICs. When using desktop computers, GPUs, or older versions of ASICs, the cost of energy consumption actually surpasses the revenue generated. Even with the newest unit at your disposal, one pc is rarely enough to compete with what what miners call"mining pools" .
A mining pool is a group of miners who combine their Resources 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 approximately 80% to 90 percent of bitcoin computing power. .
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Between 1 in 7 trillion chances, scaling difficulty levels, and also the huge network of users verifying transactions, one block of transactions is confirmed roughly every 10 minutes. But its important to keep in mind that 10 minutes is a goal, 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 grow, but the number of transactions made in 10 minutes will eventually exceed the number of transactions which can be processed in 10 minutes.