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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 all about 7,184,404,942,701. That is, the chance of a computer producing a hash beneath the target is just 1 in 7,184,404,942,701 less than 1 in 7 trillion. That amount is corrected every 2016 blocks, or about every 2 weeks, with the aim of keeping rates of mining constant.

The opposite is also correct. If computational power has been taken off of this network, the difficulty adjusts downward to earn mining easier. .

"Say I tell three friends that I'm thinking about a number between 1 and 100, and that I write that number on a piece of paper and seal it in an envelope. My friends don't have to guess the specific number, they just must be the very first person to guess any number that's less than or equal to this number I am thinking of.

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"Let us 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 guesses 12, then they've both technically came at viable answers, since 16<19 and 12<19. There's no'extra credit' for Friend B, even though B's answer was nearer to the target answer of 19. .

"Now imagine that I pose the'imagine what number I am thinking of' question, however I am not asking just three friends, and I'm not thinking of a number between 1 and 100. Instead, I am asking millions of prospective miners and I'm thinking of a 64-digit hexadecimal number. Now you see that it is going to be extremely hard to guess the ideal answer." .

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If 1 in 7 trillion doesn't sound difficult enough as is, here's the catch to the catch. Not only do bitcoin miners have to come up with the right hash, they also have to be the first to do it.

Because bitcoin mining is essentially guesswork, arriving at the ideal site here answer before another miner has everything to do with how fast your computer can produce hashes. Only a decade ago, bitcoin miners can be performed competitively on normal desktops. As time passes, however, miners recognized that pictures cards commonly used for video games were more effective at mining than desktops and graphics processing units (GPU) came to dominate the match.

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

Today, bitcoin mining is so competitive it can only be done profitably using all the latest up-to-date ASICs. When using desktop computers, GPUs, or older models of ASICs, the cost of energy consumption actually surpasses the revenue generated. Even with the newest unit available, one computer 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 divide 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. .

Between 1 in 7 trillion chances, 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 remember 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 grow, however, the number of transactions made in 10 minutes will eventually exceed the number of transactions which can be processed in 10 minutes.

This issue at the center of the bitcoin protocol is known as scaling. While bitcoin miners generally agree that something has to be done in order to address scaling, there is less consensus regarding how can it. In 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 would cope 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 voted to incorporate a program that will decrease the amount of information needed to verify each block. That is, they went with Solution 1.

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The program that miners voted to increase the bitcoin protocol is known as a segregated witness, or SegWit. This term is an amalgamation of Segregated, meaning to separate, and Witness, which describes signatures on a bitcoin transaction. Segregated Witness, then, means to separate transaction signatures out of a block and attach them as an extended block.