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In 2009it had been 50. In 2013, it was 25, in the time of writing it is 12.5, and sometime in the middle of 2020 it will halve to 6.25. .

At this rate of halving, the total number of bitcoin in circulation will approach a limit of 21 million, making the currency more scarce and valuable over time but also more costly for miners to make.

Here is the catch. In order for bitcoin miners to actually earn bitcoin from verifying transactions, two things must happen. First, they need to verify 1 megabyte (MB) worth of transactions, which can theoretically be as little as 1 transaction but are far more often several thousand, depending on how much information each transaction shops.

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Second, in order to add a block of transactions to the blockchain, miners must fix a intricate computational science difficulty, also called a"proof of work." What they are actually doing is trying to think of a 64-digit hexadecimal number, called a"hash," that is less than or equal to the target hash.

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In other words, it's a bet. .

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 goal is 1 in 7,184,404,942,701 less than 1 in seven trillion. That amount is corrected every 2016 blocks, or roughly every 2 weeks, with the goal of keeping rates of mining constant.

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The reverse is also true. If computational power is taken from the network, the difficulty adjusts downward to earn mining easier. .

"Say I tell three friends 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 simply must be the first person to figure any number that is less than or equal to the number I'm thinking of.

"Let's say I am thinking of the number 19. If Friend A guesses 21they lose because 21>19. If Friend B guesses 16 and Friend C guesses 12, then they've both 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 that I present the'imagine what number I am thinking of' question, however I'm not asking just three friends, and I'm not thinking of a number between 1 and 100. Instead, I'm asking millions of prospective miners and I'm thinking about a 64-digit hexadecimal number. Now you see that it is going to be quite difficult to guess the ideal answer." .

If 1 in seven more information trillion doesn't sound hard enough as is, here is the catch to the catch. Not only do bitcoin miners have to think of the ideal hash, they also must be the first to perform it.

Since bitcoin mining is essentially guesswork, arriving at the ideal answer before another miner has almost everything to do with how fast your computer can produce hashes. Just a decade ago, bitcoin miners can be performed competitively on normal desktop computers. Over time, however, miners realized that graphics cards commonly used for video games tend to be more effective at mining than desktops and graphics processing units (GPU) came to dominate the game.

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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 elderly versions of ASICs, the cost of energy consumption actually surpasses the revenue generated. Even with the newest unit at your disposal, one computer is seldom enough to compete with what what miners call"mining pools." .

An mining pool is a group of miners who combine their computing ability and divide the mined bitcoin between participants. A disproportionately high number of cubes are mined by pools rather than by individual miners. In July 2017, mining pools and companies represented roughly 80% to 90 percent of bitcoin computing power. .

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Between 1 in 7 trillion odds, scaling difficulty levels, and the huge network of users verifying transactions, one block of transactions is verified roughly every 10 minutes. However, 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, however, the number of transactions made in 10 minutes will eventually exceed the number of transactions which can be processed in more tips here 10 minutes.