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Let us say you had one legit $20 and one quite good photocopy of that same $20. If someone were to try to spend both the real bill and the fake one, someone who took the trouble of looking at both of the invoices' consecutive numbers would observe that they were the same number, and consequently one of them had to be fictitious.
This isn't a perfect analogy--we will explain in more detail below. .
Once a miner has verified 1 MB (megabyte) worthiness of Bitcoin transactions, they are entitled to win the 12.5 BTC. The 1 MB limit was established by Satoshi Nakamoto, and can be an issue of controversy, as some miners think the block size ought to 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 get paid out.
1MB of transactions can technically be little as 1 transaction (although this is not in any way common) or a few thousand. It depends on how much data the transactions take up.
In order to earn Bitcoin, you need to meet two conditions. One is a matter of effort, one is a matter of luck.
2) You have to be the first miner to arrive at the perfect answer to a numeric problem. This process is also known as an evidence of work.
The fantastic news: No advanced math or computation is involved. You might have discovered that miners are solving difficult mathematical problems--that's not true in any way. What they are doing is trying to be the first miner to come up with a 64-digit hexadecimal number (a"hash") that is less than or equivalent to the hash.
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The bad news: Since it is guesswork, you need a good deal of computing power in order to get there . To mine successfully, you need to get a higher"hash speed," that is quantified in terms of megahashes per second (MH/s), gigahashes per second (GH/s), and terahashes per second (TH/s).
If you want to estimate how much Bitcoin you could mine along with your mining rig's hash pace, the site Cryptocompare offers a very helpful calculator.
Either 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--especially Ethereum miners--purchase individual graphics cards (GPUs) as a low-cost method to cobble together mining operations. The photograph below is a makeshift, high-tech mining machine. The graphics cards are those rectangular cubes with whirring circles. Note the sandwich twist-ties holding the graphics cards to the metal rod.
Example: I tell three friends that 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 have to guess the specific number, they simply must be the very first person to guess any number that's less than or equal to the number I am thinking of.
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Let's say I'm thinking about the number 19. If Friend A guesses 21they lose because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they've both technically came at workable these details 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. .
In Bitcoin conditions, simultaneous answers happen frequently, but at 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 decide by a simple majority--51 percent --that miner to honour. Typically, it is the miner that has done the work, i.e.
The losing block then becomes an"orphan block" .
Now imagine that I present the"guess what number I am thinking of" question, however I'm not asking only 3 friends, and I am not thinking of a number between 1 and 100. Instead, I am asking millions of would-be miners and I am thinking of a 64-digit hexadecimal number. Now you see that it is going to be extremely difficult to guess the ideal answer.
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The number above has 64 digits. Easy enough to understand so far. As you probably noticed, that number consists not only of numbers, but also letters of this alphabet. Why is that
In order to understand what these letters are doing in the middle of numbers, let's unpack the term"hexadecimal."
As you knowwe use the"decimal" system, which means it is base 10. This in turn means that every digit has 10 possibilities, 0-9.