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Let's say you had one legit $20 and one quite good photocopy of that same $20. If someone were to attempt to spend both the real bill and the imitation one, someone who took the problem of looking at both of the bills' consecutive numbers would observe that they were exactly the same number, and consequently one of them had to be false.

This isn't a perfect 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 a matter of controversy, as some miners believe the block size ought to be increased to accommodate more information.

Note that I stated that verifying 1 MB value of transactions makes a miner eligible to earn Bitcoin--not everyone who verifies transactions will receive paid off.

1MB of transactions can theoretically be as little as 1 transaction (although this is not in any way common) or a few thousand. It depends on how much data 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 reach the right answer to a numeric issue. This process is also known as an evidence of work.

The fantastic news: No advanced math or computation is involved. You might have discovered that miners are solving challenging mathematical problems--that is not true at all. What they're actually 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: Because it is guesswork, you need a lot of computing power in order to get there . To mine successfully, you need to have a high"hash rate," which is measured 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 pace, the website Cryptocompare provides a very helpful calculator.

Either a GPU (graphics processing unit) miner or an application-specific integrated circuit (ASIC) miner. These can run from $500 into the tens of thousands.  Some miners--especially Ethereum miners--buy individual graphics cards (GPUs) as a low-cost way to cobble Homepage 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 pole.

Case in point : I tell three friends I'm thinking of a number between 1 and 100, and 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 just must be the first person to guess any number that's less than or equal to this number I'm thinking of.

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Let us say I am thinking of the number 19. If Friend A guesses 21they shed because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they've both technically came 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 goal answer of 19. .

In Bitcoin conditions, simultaneous answers happen frequently, but at the end of the day there can only be one winning answer. When multiple simultaneous answers are presented that are equivalent to or less than the target number, the Bitcoin network will decide by a simple majority--51 percent --which miner to honour. advice Normally, it is the miner who has done the most work, i.e.

The losing block then becomes an"orphan block." .

Now imagine I present the"guess what number I'm thinking of" question, but I'm not asking just three friends, and I'm not thinking of a number between 1 and 100. Rather, 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 difficult to guess the ideal answer.

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The number above has 64 digits. Easy enough to understand up to now. As you likely noticed, that number consists not only of numbers, but also letters of the alphabet. Why is that

In order to understand what these letters are doing in the center of numbers, let us unpack the term"hexadecimal."

As you know, we use the"decimal" system, which means it's base 10. This in turn means that every digit has 10 chances, 0-9.