Getting My 20000 Satoshi To Work

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Let us say you had one legit $20 and one really good photocopy of the same $20. If someone were to try to spend both the true bill and the imitation one, someone who took the problem of looking at both of those bills' consecutive numbers would see that they had been the exact same number, and thus one of them had to be fictitious.

This isn't a great analogy--we'll explain in more detail below. .

Once a miner has confirmed 1 MB (megabyte) worth of Bitcoin transactions, they are entitled to win the 12.5 BTC. The 1 MB limit was set by Satoshi Nakamoto, and can be a matter of controversy, as some miners think the block size should be increased to accommodate more data.

Note that I stated that verifying 1 MB worth of transactions makes a miner qualified to earn Bitcoin--not everyone who verifies transactions will receive paid off.

1MB of transactions can theoretically be as little as 1 transaction (although this is not at all common) or several thousand. It depends on how much information the transactions take up.

In order to earn Bitcoin, you need to meet two conditions. One is a matter of work, one is a matter of luck.

2) You have to be the first miner to reach the right answer to a numeric issue. This process is also known as an evidence of work.

The good news: No advanced math or computation is involved. You may have discovered that miners are solving challenging mathematical problems--that's not true at all. What they are actually doing is trying to be the first miner to think of a 64-digit hexadecimal number (a"hash")  that is less than or equal to the target hash.

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The bad news: Since it's guesswork, you need a good deal of computing power in order to get there . To mine , you need to get a high"hash speed," that is measured in terms of megahashes per second (MH/s), gigahashes per second (GH/s), and terahashes per second (TH/s).

If you want to estimate just how much Bitcoin you can mine along with your mining rig's hash pace, the site Cryptocompare offers a very helpful calculator.

Either way a GPU (graphics processing unit) miner or an application-specific integrated circuit (ASIC) miner. These can run from $500 into the tens of thousands.  Some miners--particularly Ethereum miners--purchase individual graphics cards (GPUs) as a cheap way to cobble together mining operations.  The photograph below is a makeshift, high-tech mining machine.  The cards are such rectangular cubes with whirring circles.  Note the sandwich twist-ties holding the graphics cards into the metal pole.

ExampleI tell three friends that I'm thinking about a number between 1 and 100, and 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's say I am thinking about the number 19. If Friend A guesses 21, they shed because 21>19. If Friend B guesses 16 and Friend C guesses 12, then they've both theoretically arrived at workable answers, since 16<19 and 12<19. There's no"extra credit" for Friend B, even though B's get more answer was closer to the target answer of 19. .

In Bitcoin conditions, simultaneous answers happen frequently, but in the end of the day there can only be one winning answer. When multiple simultaneous answers are presented that are equivalent to or less than the target number, the Bitcoin network will determine by a simple majority--51%--which miner to honour. Typically, it's the miner that has done the work, i.e.

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The losing block then becomes an"orphan block" .

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

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The number above has 64 digits. Easy enough to understand up to now. As you probably noticed, that number consists not just of numbers, but also letters of this alphabet. Why is that

In order to understand what these letters are doing in the center of numbers, let us unpack the term"hexadecimal."

As you know, we use the"decimal" system, which means it's base 10. This in turn means that every digit has 10 chances, 0-9.

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