Questions tagged [mining-theory]

This tag should be used for questions about the function, the reason for, and the underlying concepts of mining.

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176
votes
8answers
107k views

What exactly is Mining?

I have heard that mining is for people with ready hardware and blah blah blah... But what exactly is it? Does it operate like real mining? I mean, people talk about it like you are physically mining.
136
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4answers
227k views

What are bitcoin miners really solving?

As with mining, what are the bitcoin miners really solving? I read they are solving hashes, but what does that really mean. Can we see what they are solving? Can someone give an example of what a ...
118
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10answers
41k views

How much will transaction fees eventually be?

Some people keep evangelizing that Bitcoin transaction fees are much lower than in PayPal or with credit cards. However, once nearly all 21 million bitcoins have been mined, the network will still ...
109
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5answers
18k views

Why is 6 the number of confirms that is considered secure?

Why is 6 is the number of confirmations that is considered secure? I haven't found any mathematical explanation or otherwise that explains why it is 6 and not 5 or 7. Is there a historical reason for ...
64
votes
9answers
81k views

Where do bitcoins come from and what gives them their value?

Where do bitcoins come from? From the WeUseCoins.com video it appears they are just being produced by "miners" and sold to people. So who backs Bitcoin or gives it its value?
52
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4answers
30k views

What keeps the average block time at 10 minutes?

I've been told "the network" sets the difficulty level such that there will be one new block mined every ten minutes. I imagine the rich would instead prefer to keep difficulty as high as possible to ...
44
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8answers
16k views

Can bitcoin exist without miners?

In the past year only, the bitcoin mining difficulty has increased fivefold. If in the coming years the difficulty increases so much that mining is no longer profitable (i.e. consumes more power than ...
44
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4answers
16k views

Why was the target block time chosen to be 10 minutes?

According to the wiki, 10 minutes was chosen as a 'tradeoff'. Why ten minutes specifically? It is a tradeoff chosen by Satoshi between propagation time of new blocks in large networks and the ...
41
votes
2answers
13k views

What happens if two miners mine the next block at the same time?

The process of mining as described in the answer to this question is simultaneously repeated by multiple miners. Is it possible for two miners to find the next block at the same instant? If it is, ...
37
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2answers
73k views

What is Gas Limit in Ethereum?

What is the function of Gas Limit parameter in Ethereum? Is it involved in mining or something else?
30
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3answers
3k views

Are there algorithms that could have been chosen for mining that balance CPU/GPU?

The mining algorithm for Bitcoins (and most alternative but similar currencies as well) is purely computation hard, but not decision hard or memory hard. This caused the unexpected effect that GPUs ...
28
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2answers
38k views

How does proof-of-stake “mining” work?

I know and understand the concept of proof-of-stake. Instead of requiring users to do a certain amount of power-intensive hashing "work", it requires you to own a certain stake of the currency in ...
25
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1answer
14k views

When a block is “discovered” how is the nonce determined?

I know that a block is based on a random number called a nonce, but if that number is random and unknown to the miner, how is that number actually verified as the correct nonce and not some arbitrary ...
25
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4answers
71k views

The bitcoin mining algorithm from a programmer's viewpoint

This page: Blocks said mining is actually to solve a mathematical problem, but reading Block hashing algorithm doesn't give much help. I also tried reading bitcoind source code, but reading code takes ...
22
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6answers
11k views

Why did Satoshi design Bitcoin to be mineable only on specialized hardware, if the goal was decentralization?

GPU-mineable cryptos are arguably more decentralized. Did he simply miss this design aspect or does this sound fishy to you?
22
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3answers
3k views

What happens if there are no transactions in a block?

What happens if there are no transactions in a block? Suppose there is a 10 minute time frame in the middle of the night, maybe on a holiday, and there are no transactions made. Do the miners get ...
22
votes
6answers
18k views

What happens to the bitcoin network when the miners all stop in the future?

What happens to the bitcoin network when the miners all stop, years in the future after all the bitcoins have been mined? How will the network continue to function? Won't bitcoins then be useless? ...
21
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2answers
12k views

What does the term “Longest chain” mean?

What does the term "Longest chain" mean, as there is only one 'right' blockchain exists? How another longer chain would make the 'right' chain invalid?
21
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4answers
1k views

How often forks occur?

How often do forks occur in the block chain? I'm interested in the small, one block forks that happen when two miners create a block at the similar time.
20
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2answers
28k views

What does it mean for a cryptocurrency to be ASIC-resistant?

I guess the question I'm asking here is what does it take for an altcoin to be ASIC-resistant? What does it need to have?
19
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6answers
7k views

51% attack - apparently very easy? refering to CZ's “rollback btc chain” - How to make sure such corruptible scenario can never happen so easily?

I was shocked to see binance CZ comment to literally "roll back" the bitcoin chain by just "calling" in some favors from "friendly" Asian miners . This ONE person could effectively do it??? I mean ...
18
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4answers
7k views

How can one embed custom data in block headers?

Some mining pool admins put custom data in block headers, like prayers. How do they do that? Where can I see that data for myself?
18
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2answers
11k views

What is proof-of-work?

Please explain the proof-of-work concept. And how does it relate to Bitcoin mining in general, and to the proofs of work (aka shares) of mining pools?
17
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6answers
5k views

Why do we need Proof of Work in bitcoin?

I know that proof of work shows that the person has put in some time and power into the processing. I also know that bitcoin mining is adding a transaction into the blockchain and then the miner will ...
15
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8answers
3k views

Are there algorithms that could be used for mining that resist acceleration with ASICs?

In my related question about mining algorithms that balance CPU and GPU it came up that such an algorithm would tremendously increase the incentive for people to create mining botnets. The prospect of ...
15
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3answers
1k views

What happens once mining speed gets close to zero?

According to Wikipedia The number of Bitcoins created per block is never more than 50 BTC, and the awards are programmed to decrease over time towards zero, such that no more than 21 million will ...
15
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6answers
27k views

Why can't they use super computers to mine all the bitcoins?

I have very limited knowledge of bitcoin, but, I hope you don't mind my asking this question: As I understand it, "mining bitcoin" requires "significant" computational prowess. A lot of dedicated ...
15
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2answers
2k views

What happens if hash rate decreases rapidly?

Since difficulty is only adjusted every 2016 blocks, what would happen if hash rate was to decrease rapidly? Wouldn't this cause blocks to be created less frequently and also making the time until ...
14
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1answer
636 views

How will bitcoin stay decentralized when mining becomes extremely expensive?

My understanding of bitcoin is that the miners are the ones keeping bitcoin decentralized. What happens when only the richest of people can afford mining?
13
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4answers
7k views

Why can't we design a bitcoin that does useful work? [duplicate]

The bitcoin network, including every miner, is the biggest computing project that humanity has created. Thus I ask: why, instead of using it to generate useless data, don't we use it to generate ...
13
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4answers
6k views

What is more effective than ASIC mining?

Considering that mining progressed from CPU, to GPU, to FPGA, and now ASIC mining... have we finally hit the end of the road for technological advancement? What future optimizations can occur after ...
13
votes
1answer
1k views

What is the approximate hashrate of a human?

Which and how much mathematical operations are required for the blockheader-to-blockhash operation and how fast would a human be able to calculate a single hash? EDIT: For simplicity, I think it's a ...
13
votes
1answer
21k views

What is a nonce?

When I see the block info on blockchain, I see that there is a field named "nonce", I could not find any relevant information on web regarding what a nonce is. Please explain what a nonce is what is ...
12
votes
3answers
26k views

What happens when the 21 million cap is reached? [duplicate]

I've just recently gotten into bitcoin, but I'm a bit confused about this 21 million bitcoin cap. From what I've read, computers on the bitcoin network validate transactions, which confirms the ...
11
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6answers
6k views

So I mined a block, but why would other nodes accept my mined block?

When a miner finds a hash and is thus able to confirm a block of transactions, that miner will then broadcast the confirmation (block?) to the other Bitcoin nodes so that it can be added to the ...
11
votes
4answers
956 views

What can be done to slow/prevent mining centralization?

Assuming all buyers have access to the same ASICs (ignoring that ASICs developers and manufacturers will always have the latest first, even if only used for "testing" prior to sale) energy costs would ...
11
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6answers
6k views

What is the rationale behind Bitcoin mining?

I don't understand the logic of "mining", if bitcoins are a digital currency, why do we need a GPU to "make 'em"?
11
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1answer
2k views

Why do you need the *complete* blockchain to mine bitcoins, why not just the last n blocks?

I understand that to mine bitcoins you need the hash of the previous block, and in order to resolve possible forks. But why not just have the last 100 blocks (or more whatever is appropriate) and keep ...
10
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5answers
6k views

What features of scrypt() make Tenebrix GPU-resistant?

There's a fork of Bitcoin called Tenebrix that is claiming to be CPU-friendly and GPU-resistant (with regard to mining). They say that this is because they're using scrypt instead of SHA256. From what ...
10
votes
3answers
781 views

Flaw in Bitcoin protocol regarding incentives to share transactions

Once the 50BTC per block rewards have halved many times and the transaction fees start to become the primary reward for miners, it sound like there is incentive for miners to not pass on transactions ...
9
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4answers
353 views

How cooperative or competitive is the mining process?

As each miner works out which nonces it has tried, does it notify the network so that energy isn't wasted on re-processing the same thing by each node? Or is it totally competitive with everyone for ...
8
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3answers
1k views

Does mining a block force others to restart their work?

Does mining a block mean that anyone else who was working on mining a block loses their progress and must restart?
8
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3answers
1k views

Do miners have both the incentive and ability to keep the reward at 50BTC?

There has been some concern about the fact that transaction fees (in their current form) are not an adequate replacement for the current 50BTC block reward. Gavin has said as much, as have others. ...
8
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3answers
3k views

How does the mining process support the currency?

Why is mining Bitcoins necessary? Is it essentially a distribution mechanism to ensure Bitcoins are not held by a few (wealthy) individuals from the get-go who might just hoard Bitcoins rather than be ...
8
votes
4answers
17k views

Why is mining necessary for the Bitcoin network/system? [duplicate]

I understand that a transaction is a record of 1+ Bitcoins being given from one party to another. I understand that a block is a collection of unverified (pending) transactions that gets verified ...
8
votes
1answer
291 views

When and who coined the term “mining”?

When was the term "mining" (the process of hashing, processing the transactions, adding blocks to the blockchain etc.) first used? Was it there right from the beginning of bitcoin? Who was the ...
8
votes
1answer
2k views

Calculate hash of block header

I'm trying to calculate the hash of block #502871. This is the block: { "result": { "hash": "00000000000000000020cf2bdc6563fb25c424af588d5fb7223461e72715e4a9", "confirmations": 35, "...
8
votes
1answer
570 views

In Proof-of-Stake, can the same miner mine a block multiple times in a row?

In Proof-of-Work, there are no rules on who will mine the next block - the selection is random and proportional to miners' computing power. How is the next miner selected in various Proof-of-Stake ...
7
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2answers
2k views

How to prevent a miner from stealing another miner's block?

Many articles only contain a phrasing like A miner A solves the hash problem and gives the result to the network to check. Once a majority of the network confirms, A gets the reward. But how does ...
7
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3answers
5k views

What Value does mining provide?

After reading the O'Reilly book and perusing online resources, I'm still confused about the value that the actual mathematical mining provides to Network (I understand it does provide value, but not ...