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

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

Here's the catch. In order for bitcoin miners to actually earn bitcoin from verifying transactions, two things must occur. First, they must verify 1 megabyte (MB) worth of transactions, which can technically be as small as 1 transaction but are far 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 math problem, also referred to as a"proof of labour ." What they are doing is trying to come up with a 64-digit hexadecimal number, called a"hash," that's less than or equivalent to the hash.

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In other words, it's a gamble. .

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

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The reverse is also correct. If computational power is taken off of the network, the difficulty adjusts downward to earn mining simpler. .

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

"Let us say I'm thinking of the number 19. If Friend A guesses 21they shed because 21>19. If Friend B guesses 16 and Friend C supposes 12, then they've both technically came at workable answers, because 16<19 and 12<19. There's no'extra credit' for Friend B, even though B's their explanation answer was closer to the goal answer of 19. .

"Now imagine I present the'imagine what number I am thinking of' question, but I am not asking only 3 friends, and I'm not thinking of a number between 1 and 100. Instead, I'm asking millions of prospective miners and I am thinking about a 64-digit hexadecimal number. Now you see that it is going to be quite hard to guess the right answer." .

If 1 in 7 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, but they also must be the first to perform it.

Since bitcoin mining is essentially guesswork, arriving at the ideal answer before another miner has everything to do with how fast your computer can produce hashes. Just a decade ago, bitcoin miners can be performed competitively on normal desktops. As time passes, 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 match.

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

Nowadays, bitcoin mining is so aggressive it can only be done profitably using all the most up-to-date ASICs. When using desktop computers, GPUs, or older models 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 what what miners call"mining pools." .

An mining pool is a group of miners that combine their computing power 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 approximately 80% to 90% of bitcoin computing power. .

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Between 1 in 7 trillion odds, scaling difficulty levels, and the massive network of consumers verifying transactions, one block of transactions is confirmed roughly every 10 minutes. However, its important to remember that 10 minutes is a target, not a rule.

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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.