When a miner hashes a blocksheader and it produces a hash that is lower than the value represented by nBits then the PoW is considered solved.

What exactly does this mean? For example a SHA256 hash has the following structure: c45bc3de9bff9ee27fc7303a3aa4fa8022ab6608d42bbea4d72bbee9b719703b how do you determine whether this is below an nBits value?


nBits refers to the target. The target is a 256 bit number and inversely proportional to the difficulty.

You can calculate the difficulty from the target with the following formula:

difficulty = difficulty_1_target / current_target

where difficulty_1_target represents the target corresponding to the first difficulty on the network which was a 256 bit number with the leading 32 bits set to zero and the rest set to 1. Alternatively, the formula works out to:

difficulty = 2^208 * 65535 / current_target.

Back to blocks:
While we often see the block hash represented as hexadecimal numbers which include the letters from A–F for the numbers 10-15, block hashes result from SHA256d hashing. The output of SHA256 is a 256 bit number (hence the name). When miners are searching for a valid block, they create a multitude of block candidates. When one of these candidates' hash digests (interpreted as a 256 bit number) is smaller than or equal to the difficulty, the miner has found a valid block.

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  • Okay, my question is then how is a hashoutput below that? This sounds super dumb, but I mean it has letters etc in it? Is it because we convert the hashoutput to a binary value? And then if that has a value lower than the nBit then we have solved the proof of work problem? Thanks for the help by the way! – no nein Jul 27 '17 at 16:00
  • @nonein: Hey, I've updated my answer to cover your follow-up questions. – Murch Jul 27 '17 at 16:41
  • Thanks! So in effect the A's etc are all numbers, thus making the whole thing correspond to a string of numbers? – no nein Jul 27 '17 at 18:04
  • Hexadecimal is a base sixteen number system. Each position may have values from 0-15 (as the decimal system can have values of 0-9 and the binary system can have values of 0-1). The sixteen "digits" are represented by 0-9 and A-F, where A stands for 10 and F stands for 15. – Murch Jul 27 '17 at 18:49
  • @nonein: Yeah, the letters correspond to numbers. Each character in a hexadecimal number corresponds to four characters in binary. E.g. c45b would translate to 1100010001011011. – Murch Jul 28 '17 at 16:25

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