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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 rate 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 is the catch. In order to get bitcoin miners to really earn bitcoin from verifying transactions, two things must occur. To begin with, they must 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 data each transaction stores.

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Second, in order to put in a block of transactions to the blockchain, miners must solve a complex computational science difficulty, also referred to as a"proof of work." What they're 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 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 pc producing a hash beneath the target is just 1 in 7,184,404,942,701 less than 1 in 7 trillion. That amount is adjusted every 2016 blocks, or roughly every two weeks, with the goal of keeping rates of mining constant.

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The opposite is also true. If computational power is taken off of the network, the problem adjusts downward to earn mining easier. .

"Say I tell three friends 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 need to guess the exact number, they simply have to be the very first person to figure any number that's less than or equal to the number I am thinking of.

"Let's say I'm thinking of the number 19. If Friend A guesses 21, they shed because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they've both technically came at workable answers, since 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 I present the'guess what number I'm thinking of' question, but I am not asking only 3 friends, and I am not thinking of a number between 1 and 100. Instead, I'm asking millions of prospective miners and I'm thinking of a 64-digit hexadecimal number. Now you see that it's going to be extremely difficult navigate here to guess the ideal answer." .

If 1 in seven trillion doesn't sound hard enough as is, here's the catch to the catch. Not only do bitcoin miners need to come up with the ideal hash, they also must be the very first to do 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. Only a decade ago, bitcoin miners could be carried out competitively on normal desktops. As time passes, however, miners recognized that graphics cards commonly utilized for video games were 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 to the tens of thousands. .

Today, bitcoin mining is so competitive that it can only be done profitably using all the latest up-to-date ASICs. When using desktop computers, GPUs, or elderly models of ASICs, the expense of energy consumption actually exceeds 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." .

A mining pool is a group of miners who combine their computing ability 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 percent of bitcoin computing power. .

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Between 1 in 7 trillion odds, scaling difficulty levels, and the massive network of users verifying transactions, one block of transactions is verified 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. Since the network of bitcoin users continues to grow, but the number of transactions made in 10 minutes will eventually exceed the number of transactions which can be processed in 10 minutes.