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Let us say you had one legit $20 and one really 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 both of those invoices' consecutive numbers would observe that they had been the exact same number, and thus one of them needed to be fictitious.

That isn't a perfect analogy--we'll explain in more detail below. .

Once a miner has confirmed 1 MB (megabyte) worthiness of Bitcoin transactions, they are eligible to win the 12.5 BTC. The 1 MB limit was established by Satoshi Nakamoto, and is an issue of controversy, as some miners think the block size should be increased to accommodate more data.

Note that I said that verifying 1 MB worth of transactions makes a miner qualified to earn Bitcoin--not everyone who supports transactions will get paid out.

1MB of transactions can technically be small as 1 transaction (though this is not in any way common) or several thousand. It depends on how much data the transactions consume.

In order to earn Bitcoin, you need to meet two conditions. One is a matter of work, one is a matter of luck.

2) You must be the first miner to arrive at the right answer to some numeric problem. This practice is also known as a proof of work.

The fantastic news: No advanced math or computation is involved. You might have discovered that miners are solving difficult mathematical problems--that's not true in any way. What they are 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 equivalent to the hash.

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The bad news: Since it's guesswork, you need a good deal of computing power in order to get there first. To mine successfully, you need to get a high"hash rate," that 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 very helpful calculator.

Either way 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 method to cobble together mining operations.  The photo below is a makeshift, high-tech mining machine.  The cards are find more information those rectangular cubes with whirring circles.  Note the sandwich twist-ties holding the graphics cards to the metal rod.

Case in point I tell three friends I'm thinking about 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 have to be the first person to figure any number that's less than or equal to the number I'm thinking of.

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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 guesses 12, then they've both technically came at viable 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. .

In Bitcoin terms, simultaneous answers occur frequently, but in the end of the day there can look at these guys 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 determine by a simple majority--51 percent --that miner to honour. Normally, it's the miner that has done the work, i.e.

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

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

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

In order to understand what these letters are doing in the middle 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 here means that every digit has 10 chances, 0-9.

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