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In 2009, it was 50. In 2013, it had been 25, in the time of writing it's 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 valuable over time but also more expensive for miners to make.
Here is the catch. In order to get bitcoin miners to actually earn bitcoin from verifying transactions, two things have to happen. To begin with, they need to confirm 1 megabyte (MB) worth of transactions, which can theoretically be as little as 1 transaction but are more often several 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 should fix a intricate computational science difficulty, also referred to as a"proof of labour ." What they are actually doing is trying to come up with a 64-digit hexadecimal number, known as 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. 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 seven trillion. That amount is adjusted every 2016 blocks, 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 the network, the difficulty adjusts downward to make mining easier. .
"Let us 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 have both theoretically arrived at viable answers, since 16<19 and 12<19. There is no'extra credit' for Friend B, even though B's answer was closer to the goal answer of 19. .
"Now imagine I pose the'guess what number I am thinking of' question, however I am not asking only three 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's going to be quite hard to guess the ideal answer." .
If 1 in 7 trillion doesn't sound hard enough as is, here's the grab to the catch. Not only do bitcoin miners have to come up with the ideal hash, they also have to be the first to do it.
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These can run from $500 into the tens of thousands. .
Today, bitcoin mining is so aggressive it can only be done profitably using the latest up-to-date ASICs. When using desktop computers, GPUs, or older versions of ASICs, the expense of energy consumption actually exceeds the revenue generated. Even with the newest unit available, one computer is seldom enough to compete with exactly what miners call"mining pools." .
A mining pool is a group of miners who combine their computing power 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% of bitcoin computing power. .
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Between 1 in 7 trillion odds, scaling difficulty levels, and also the huge network of users verifying transactions, one block of transactions is verified roughly every 10 minutes. But its important to keep in mind 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 every 10 minutes. Since the network of bitcoin consumers continues to grow, however, the number of transactions made in 10 minutes will eventually exceed the number of transactions that can be processed in 10 minutes.