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Let's say you had one legit $20 and one really good photocopy of the same $20. If someone were to attempt to spend both the real bill and the imitation one, someone who took the trouble of looking at both of those invoices' serial numbers would observe that they had been exactly the exact same number, and consequently one of them needed to be false.

That isn't a great analogy--we will explain in more detail below. .

Once a miner has verified 1 MB (megabyte) worth of Bitcoin transactions, they are eligible to win the 12.5 BTC. The 1 MB limit was established by Satoshi Nakamoto, and is a matter of controversy, as some miners believe the block size ought to be increased to accommodate more data.

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

1MB of transactions can technically be small as 1 transaction (although this is not at all 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 work, one is a matter of luck.

2) You have to be the first miner to arrive at the right 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 difficult mathematical problems--that's not true at all. What they're actually doing is trying to be the first miner to think of a 64-digit hexadecimal number (a"hash")  that is less than or equivalent to the target hash.

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The bad news: Since it's guesswork, you need a lot of computing power Continue in order to get there . To mine successfully, you need to have a high"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 with your mining rig's hash rate, the website Cryptocompare offers 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--particularly Ethereum miners--purchase individual graphics cards (GPUs) as a cheap method to cobble together mining operations.  The photo below is a makeshift, high-tech mining machine.  The graphics cards are such rectangular blocks with whirring circles.  Note the sandwich twist-ties holding the pictures cards to the metal rod.

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

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Let's say I am thinking about the number 19. If Friend A guesses 21, they lose because 21>19. If Friend B supposes 16 and Friend C guesses 12, then they have 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 goal answer of 19. .

In Bitcoin conditions, simultaneous answers occur frequently, but in 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 determine by a simple majority--51%--that miner to honour. Typically, it's the miner who has done the most work, i.e.

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

Now imagine that I present the"figure what number I'm thinking of" question, however I'm not asking only three 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 of a 64-digit hexadecimal number. Now you see that it is going to be extremely difficult to guess the right answer.

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The number preceding has 64 digits. Easy enough to understand so far. As you likely noticed, that number consists not just 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 word"hexadecimal."

As you knowwe utilize the"decimal" system, which means it is base 10. This in turn means that each and every digit has 10 chances, 0-9.