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Let us say you had one legit $20 and one quite good photocopy of the same $20. If someone were to try to spend both the true bill and the imitation one, someone who took the trouble of looking at either of those bills' consecutive numbers would observe that they had been the exact same number, and consequently one of them needed to be fictitious.
That isn't a great analogy--we'll 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 set by Satoshi Nakamoto, and is an issue of controversy, as some miners think the block size ought to be increased to accommodate more data.
Note that I said that verifying 1 MB worth of transactions makes a miner eligible to earn Bitcoin--not everyone who verifies transactions will receive paid off.
1MB of transactions can technically be little as 1 transaction (though this is not at all common) or several thousand. It depends on how much information 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 a proof of work.
The good news: No advanced math or computation is involved. You may have heard that miners are solving challenging mathematical problems--that's not true in any way. What they're doing is trying to be the first miner to come up with a 64-digit hexadecimal number (a"hash") which is less than or equal to the target hash.
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The bad news: Since it is guesswork, you need a lot of computing power in order to get there first. To mine successfully, you need to get a higher"hash rate," which 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 just how much Bitcoin you can mine along with your mining rig's hash rate, the website Cryptocompare provides a helpful calculator.
Either way a GPU (graphics processing unit) miner or an application-specific integrated circuit (ASIC) miner. These can run from $500 to the tens of thousands. Some miners--especially link Ethereum miners--purchase individual graphics cards (GPUs) as a cheap way to cobble together mining operations. The photograph below is a makeshift, home-made mining machine. The graphics cards are those rectangular cubes with whirring circles. Note the sandwich twist-ties holding the pictures cards into the metal rod.
Case in point I tell three friends I'm thinking of 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 exact number, they just have to be the first person to figure any number that is less than or equal to this number I am thinking of.
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Let us say I am thinking about the number 19. If Friend A guesses 21they lose because 21>19. If Friend B guesses 16 and Friend C supposes 12, then they've both theoretically arrived at viable answers, because 16<19 and 12<19. There's no"extra credit" for Friend B, even though B's answer was nearer to the target answer of 19. .
In Bitcoin terms, simultaneous answers occur frequently, but in the end of the day there can only be one winning answer. When multiple simultaneous answers are presented which can be equal to or less than the target number, the Bitcoin network will decide by a simple majority--51%--that miner to honour. Typically, it is the miner that has done the work, i.e.
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The number above has 64 digits. Easy enough to understand so far. As you likely noticed, that number consists not just of numbers, but also letters of this alphabet. Why is that
In order to understand what these letters are doing in the center 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 each and every digit has 10 chances, 0-9.