Bitcoin mining hardware explained variance. Bitcoin network - Wikipedia. The Basics of Cryptocurrency Mining, Explained in Plain English | The Motley Fool

Bitcoin Mining, Explained

Price. Global Vol. Diff.

Bitcoin mining pools are a way for Bitcoin miners to pool their resources together and share their hashing power while splitting the reward equally according to the amount of shares they contributed to solving a block.

A "share" is awarded to members of the Bitcoin mining pool who present a valid proof of work Bitcoin mining hardware explained variance their Bitcoin miner solved. Bitcoin mining in pools began when the difficulty for mining increased to the point where it could take Bitcoin mining hardware explained variance for slower miners to generate a block.

The solution to this problem was for miners to pool their resources so they could generate blocks quicker and therefore receive a portion of the Bitcoin block reward on a consistent basis, rather than randomly once every few years.

Sometimes you may want to mine a more profitable altcoin like MWC which is superior Bitcoin mining hardware explained variance scalability, privacy, anonymity and fungibility.

Network Consensus

If you solo-mine, meaning Bitcoin mining hardware explained variance do not mine with a Bitcoin mining pool, then you will need to ensure that you are in consensus with the Bitcoin network. The best way is to use the official BitCore client.

If you participate in a Bitcoin mining pool then you will want to ensure that they are engaging in behavior that is in agreement with your philosophy towards Bitcoin.

For example, some rogue developers have threatened to release software that could hard-fork the network which would likely result in tremendous financial damage.

Therefore, it is your duty to make sure that any Bitcoin mining power you direct to a mining pool does not attempt to enforce network consensus rules you disagree with.

Segregated Witness

When segwit is activated, you will want to be able to mine and relay segwit-style blocks. The following mining software has been upgraded to support segwit.

Please note that software that supports the GetBlockTemplate (GBT) RPC must be upgraded to support the BIP9 and BIP145 changes to GBT. All the programs linked above that support GBT have been upgraded.

Segwit is already activated and enforced on testnet, so you may find it useful to test your infrastructure upgrade by mining with some small amount of hashrate on testnet. Alternatively, Bitcoin Core 0.13.1’s regression test mode (regtest) also supports segwit by default.

Bitcoin Mining Pools

There are many good Bitcoin mining pools to choose from. Although it's tempting to pick the most popular one, it's better for the health of the network to mine with smaller pools so as to avoid potentially harmful concentration of hashing power.

The hash rate distribution is best when split among more Bitcoin mining pools.

Bitcoin Mining Pool Hash Rate Distribution

Bitcoin Mining Pool Options

For a fully decentralized pool, we highly recommend p2pool and Multipool. us.

The following pools are believed to be Currently fully validating blocks with Bitcoin Core 0.11 or later:

BTCC: BTCC is a Bitcoin exchange, wallet, and mining pool located in China. Its mining pool currently controls around 15% of the network hash rate.

Slush Pool: Slush Pool is run by Satoshi Labs, a Bitcoin company based in the Czech Republic. Slush Pool was the first mining pool and maintains around 7% of the network hash rate.

Antpool: [WARNING] - Bitmain operates Antpool and some consider them to be a malicious actor in the Bitcoin ecosystem because of the AntBleed scandal where they were intentionally including malware within mining equipment they sell. In a corporate communication, Bitmain claimed this was a feature and not a bug. This malware would enable Bitmain to remotely shut down equipment of customers or competitors thus increasing their own profitability. Additionally, such behavior could pose a risk to the entire Bitcoin network.

Eligius: Eligius was one of the first Bitcoin mining pools and was founded by Luke Dashjr, a Bitcoin Core developer. Today, the pool controls just under 1% of the network hash rate.

BitMinter: BitMinter, once one of the largest Bitcoin mining pools, now controls less than 1% of the network hash rate.

Kano CKPool: Kano CKPool was founded in 2014 Bitcoin mining hardware explained variance currently has around 3% Bitcoin mining hardware explained variance the network hash rate under its control.

F2Pool: Bitcoin mining hardware explained variance is the second largest Bitcoin mining Bitcoin mining hardware explained variance, with around 25% of the network hash rate. Its user interface is in Chinese, making it difficult for English speakers to join.

BW Pool: BW Pool controls around 7% of the network hash rate. Like F2Pool, its user interface is in Chinese, making it difficult for English speakers to join.

Bitfury: Although seen publically in block explorers and hash rate charts, BitFury is a private mining pool and cannot be joined.

Bitcoin Mining Pool Payment Methods

Calculating your share of the bitcoins mined can be complex. In an ongoing effort to come up with the fairest method and prevent gaming of the system, many calculation schemes have been invented. The two most popular types are PPS and DGM. PPS, or 'pay per share' shifts the risk to the mining pool while they guarantee payment for every share you contribute.

PPS payment schemes require a very large reserve of 10,000 BTC Bitcoin mining hardware explained variance order to ensure they have the means of enduring a streak of bad luck. For this reason, most Bitcoin mining pools no longer support it.

One of the few remaining PPS pools is EclipseMC. DGM is Bitcoin mining hardware explained variance popular payment scheme because it offers a nice balance between short round and long round blocks. However, end users must wait for full round confirmations long after the blocks are processed.

PPS: The Pay-per-Share (PPS) approach offers an instant, guaranteed payout for each share that is solved by a miner. Miners are paid out from the pools existing balance and can withdraw their payout immediately. This model allows for the least possible variance in payment for miners while also transferring much of the risk to the pool's operator.

PROP: The Proportional approach offers a proportional distribution of the reward when a block is found amongst all workers, based off of the number of shares they have each found.

PPLNS: The Pay Per Last N Shares (PPLN) approach is similar to the proportional method, but instead of counting the number of shares in the round, it instead looks at the last N shares, no matter the boundaries of the round. Bitcoin mining hardware explained variance The Double Geometric Method (DGM) is a hybrid Bitcoin mining hardware explained variance that enables the operator to absorb some of the risk. The operator receives a portion of payouts during short rounds and returns it during longer rounds to normalize payments.

SMPPS: The Shared Maximum Pay Per Share (SMPPS) uses Bitcoin mining hardware explained variance similar approach to PPS but never pays more than the Bitcoin mining pool has earned.

ESMPPS: The Equalized Shared Maximum Pay Per Share (ESMPPS) is similar to SMPPS, but distributes payments equally among all miners in the Bitcoin mining pool.

RSMPPS: The Recent Shared Maximum Pay Per Share (RSMPPS) is also similar to SMPPS, but the system prioritizes the most recent Bitcoin miners first.

CPPSRB: The Capped Pay Per Share with Recent Backpay uses a Maximum Pay Per Share (MPPS) reward system that will pay Bitcoin miners as much as possible using the income from finding blocks, but will never go bankrupt.

BPM: Bitcoin Pooled mining (BPM), also known as "Slush's pool", uses a system where older shares from the beginning of a block round are given less weight than more recent shares. This reduces the ability to cheat the mining pool system by switching pools during a round.

POT: The Pay on Target (POT) approach is a high variance PPS that pays out in accordance with the difficulty of work returned to the pool by a miner, rather than the difficulty of work done by the pool itself.

SCORE: The SCORE based approach uses a system whereby a proportional reward is distributed and weighed by the time the work was submitted. This process makes later shares worth more than earlier shares and scored by time, thus rewards are calculated in proportion to the scores and not shares submitted.

ELIGIUS: Eligius was designed by Luke Jr., creator of BFGMiner, to incorporate the strengths of PPS and BPM pools, as miners submit proofs-of-work to earn shares and the pool pays out immediately. When the block rewards are distributed, they are divided equally among all shares since the last valid block and the shares contributed to stale blocks are cycled into the next block's shares. Rewards are only paid out if a miner earns at least. 67108864 and if the amount owed is less than that it will be rolled over to the next block until the limit is achieved. However, if a Bitcoin miner does not submit a share for over a period of a week, then the pool will send any remaining balance, regardless of its size.

Triplemining: Triplemining brings together medium-sized pools with no fees and redistributes 1% of every block found, which allows your share to grow faster than any other Bitcoin Bitcoin mining hardware explained variance pool approach. The administrators of these Bitcoin mining pools use some of the Bitcoins generated when a block is found to add to a jackpot that is triggered and paid out to the member of the pool who found the block. In this way, everyone in the pool has a better chance to make additional Bitcoins, regardless of their processing power.

Reader Requested: Mining Solo vs. Joining A Bitcoin Mining Pool

Bitcoin network

For broader coverage of this topic, see Bitcoin.

The Bitcoin network is a peer-to-peerpayment network that operates on a cryptographic protocol. Users send and receive bitcoins, the units of currency, by broadcasting digitally signed messages to the network using bitcoin cryptocurrency wallet software. Transactions are recorded into a distributed, replicated public database known as the blockchain, with consensus achieved by a proof-of-work system called Mining. Satoshi Nakamoto, the designer of bitcoin, claimed that design and coding of bitcoin began in 2007. The project was released in 2009 as open source software.

The network requires minimal structure to share transactions. An ad hoc decentralized network of volunteers is sufficient. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will. Upon reconnection, a node downloads and verifies new blocks from other nodes to complete its local copy of the blockchain.[2][3]

Transactions[edit]

A bitcoin is defined by a sequence of digitally signed transactions that began with the bitcoin's creation, as a block reward. The owner of a bitcoin transfers it by digitally signing it over to the next owner using a bitcoin transaction, much like endorsing a traditional bank check. A payee can examine each previous transaction to verify the chain of ownership. Unlike traditional check endorsements, bitcoin transactions are irreversible, which eliminates risk of chargeback fraud.

Although it is possible to handle bitcoins individually, it would be unwieldy to require a separate transaction for every bitcoin in a transaction. Transactions are therefore allowed to contain multiple inputs and outputs, allowing bitcoins to be split and combined. Common transactions will have either a single input from a larger previous transaction or multiple inputs combining smaller amounts, and one or two outputs: one for the payment, and one returning the change, if any, to the sender. Any difference between the total input and output amounts of a transaction goes to miners as a transaction fee.[2]

Mining[edit]

See also: Mining pool

To form a distributed timestamp server as a peer-to-peer network, bitcoin uses a proof-of-work system.[3] This work is often called Bitcoin mining.

Requiring a proof of work to accept a new block to the blockchain was Satoshi Nakamoto's key innovation. The mining process involves identifying a block that, when hashed twice with SHA-256, yields a number smaller than the given difficulty target. While the average work required increases in inverse proportion to the difficulty target, a hash can always be verified by executing a single round of double SHA-256.

For the bitcoin timestamp network, a valid proof of work is found by incrementing a nonce until a value is found that gives the block's hash the required number of leading zero bits. Once the hashing has produced a valid result, the block cannot be changed without redoing the work. As later blocks are chained after it, the work to change the block would include redoing the work Bitcoin mining hardware explained variance each subsequent block.

Majority consensus in bitcoin is represented by the longest chain, which required the greatest amount of effort to produce. If a majority of computing power is controlled by honest nodes, the honest chain will grow fastest and outpace any competing chains. To modify a past block, an attacker would have to redo the proof-of-work of that block and all blocks after it and then surpass the work of the honest nodes. The probability of a slower attacker catching up diminishes exponentially as subsequent blocks are added.[3]

To compensate for increasing hardware speed and varying interest in running nodes over time, the difficulty Bitcoin mining hardware explained variance finding a valid hash is adjusted roughly every two weeks. If blocks are generated too quickly, the difficulty Bitcoin mining hardware explained variance and more hashes are required to make a block and to generate new bitcoins.[3]

Difficulty[edit]

Bitcoin mining is a competitive endeavor. An "arms race" has been observed through the various hashing technologies that have been used to mine bitcoins: basic CPUs, high-end GPUs common in many gaming computers, FPGAs and ASICs all have been used, each reducing the profitability of the less-specialized technology. Bitcoin-specific ASICs are now the primary method of mining bitcoin and have surpassed GPU speed by as much as 300-fold. The difficulty within the mining process involves self-adjusting to the network's accumulated mining power. As bitcoins have become more difficult to mine, Bitcoin mining hardware explained variance hardware manufacturing companies have seen an increase in sales of high-end ASIC products.[4]

Computing power is often bundled together or "pooled" to reduce variance in miner income. Individual mining rigs often have to wait for long periods to confirm a block of transactions and receive payment. In a pool, all participating miners get paid every time a Bitcoin mining hardware explained variance server solves a block. This payment Bitcoin mining hardware explained variance on the amount of work an individual miner contributed to help find that block.[5]

Energy sources & consumption[edit]

In 2013, Mark Gimein estimated electricity consumption to be about 40.9 megawatts (982 megawatt-hours a day).[6] In 2014, Hass McCook estimated 80.7 megawatts (80,666 kW). As of 2015[update], The Economist estimated that even if all miners used modern facilities, the combined electricity consumption would be 166.7 megawatts (1.46 terawatt-hours per year).[7] The Cambridge Bitcoin Electricity Consumption Index estimates the energy use of the bitcoin network grew from 1.95 terawatt-hours per year at the end of 2014, to 77.1 terawatt-hours per year by the end of 2019.[8]

Seeking lower electricity costs, some bitcoin miners have set up in places like Iceland where geothermal energy is cheap and cooling Arctic air is free.[9] Chinese bitcoin miners are known to use hydroelectric power in Tibet to reduce electricity costs.[10] North American companies are utilizing stranded gas as a cost effective source of energy for bitcoin mining.[11] In West Texas, wind powers bitcoin mining.[12]

Process[edit]

A rough overview of the process to mine bitcoins involves:[3]

New transactions are broadcast to all nodes. Each miner node collects new transactions into a block. Each miner node works on finding a proof-of-work code for its block. When a node finds a proof-of-work, it broadcasts the block to all nodes. Receiving nodes validate the transactions it holds and accept only if all are valid. Nodes express their acceptance by moving to work on the next block, incorporating the hash of the accepted block.

Mined bitcoins[edit]

By convention, the first transaction in a block is a special transaction that produces new bitcoins owned by the creator of the block. This is the incentive for nodes to support the network.[2] It provides the way to move new bitcoins into circulation. The reward for mining halves every 210,000 blocks. It started at 50 bitcoin, dropped to 25 in late 2012 and to 12.5 bitcoin in 2016. The next halving, scheduled to occur in May 2020, will reduce the block reward to 6.25 bitcoin. This halving process is programmed to continue a maximum 64 times before new coin creation ceases.[13]

Security[edit]

Various potential attacks on the bitcoin network and its use as a payment system, real or theoretical, have been considered. The bitcoin protocol includes several features that protect it against some of those attacks, such as unauthorized spending, double spending, forging bitcoins, and tampering with the blockchain. Other attacks, such as theft of private keys, require due care by users.[14][15]

Unauthorized spending[edit]

Unauthorized spending is mitigated by bitcoin's implementation of public-private key cryptography. For example; when Bitcoin mining hardware explained variance sends a bitcoin to Bob, Bob becomes the new owner of the bitcoin. Bitcoin mining hardware explained variance observing the transaction might want to spend the bitcoin Bob just received, but she cannot sign the transaction without the knowledge of Bob's private key.[15]

Double spending[edit]

A specific problem that an internet payment system must solve is double-spending, whereby a user pays the same coin to two or more different recipients. An example of such a problem Bitcoin mining hardware explained variance be if Eve sent a bitcoin to Alice and later sent the same bitcoin to Bob. The bitcoin network guards against double-spending by recording all bitcoin transfers in a ledger (the blockchain) that is visible to Bitcoin mining hardware explained variance users, and ensuring for all transferred bitcoins that they haven't been previously spent.[15]:4

Race attack[edit]

If Eve offers to pay Alice a bitcoin in exchange for goods and signs a corresponding transaction, it is still possible that she also creates a different transaction at the same time sending the same bitcoin to Bob. By the rules, the network accepts only one of the transactions. This Bitcoin mining hardware explained variance called a race attack, since there is a race which transaction will be accepted first. Alice can reduce the risk of race attack stipulating that she will not deliver the goods until Eve's payment to Alice appears in the blockchain.[16]

A variant race attack (which has been called a Finney attack by reference to Hal Finney) requires the participation of a miner. Instead of sending both payment requests (to pay Bob and Alice with the same coins) to the network, Eve issues only Alice's payment request to the Bitcoin mining hardware explained variance, while the accomplice tries to mine a block that includes the payment to Bob instead of Alice. There is a positive Bitcoin mining hardware explained variance that the rogue miner will succeed before the network, in which case the payment to Alice will be rejected. As with the plain race attack, Alice can reduce the risk of a Finney attack by waiting for the payment to be included in the blockchain.[17]

History modification[edit]

Each block that is added to the blockchain, starting with the block containing a given transaction, is called a confirmation of that transaction. Ideally, merchants and services that receive payment in bitcoin should wait for at least one confirmation to be distributed over the network, before assuming that the payment was done. The more confirmations that the merchant waits for, the more difficult it is for an attacker to successfully reverse the transaction in a blockchain—unless the attacker controls more than half the total network power, in which case it is called a 51% attack.[18]

Deanonymisation of clients[edit]

Deanonymisation is a strategy in data mining in which anonymous data is cross-referenced with other sources Bitcoin mining hardware explained variance data to re-identify the anonymous data source. Along Bitcoin mining hardware explained variance transaction graph analysis, which may reveal Bitcoin mining hardware explained variance between bitcoin addresses (pseudonyms),[14][19] there is a possible attack[20] which links a user's pseudonym to its IP address. If Bitcoin mining hardware explained variance peer is using Tor, the attack includes a method to separate the peer from the Tor network, forcing them to use their real IP address for any further transactions. The attack makes use of bitcoin mechanisms of relaying peer addresses and anti-DoS protection. The cost of the attack on the full bitcoin network is under €1500 per month.[20]

Payment verification[edit]

Main article: Online transaction processing

Each miner can choose which transactions are included in or exempted from a block.[21] A greater number of transactions in a Bitcoin mining hardware explained variance does not equate to greater computational power required to solve that block.[21]

Upon receiving a new transaction a node must validate it: in particular, verify that none of the transaction's inputs have been previously spent. To carry out that check, the node needs to access the blockchain. Any user who does not trust his network neighbors, should keep a full local copy of the blockchain, so that any input can be verified.

As noted in Nakamoto's whitepaper, it is possible to verify bitcoin payments without running a full network node (simplified payment verification, SPV). A user only needs a copy of the block headers of the longest chain, which are available by querying network nodes until Bitcoin mining hardware explained variance is apparent that the longest chain has been obtained. Then, get the Merkle tree branch linking the transaction to its block. Linking the transaction to a place in the chain demonstrates that a network node has accepted it, and blocks added after it further establish the confirmation.[2]

Data in the blockchain[edit]

While it is possible to store any digital file in the blockchain, the larger the transaction size, the larger any associated fees become. Various items have been embedded, including URLs to child pornography, an ASCII art image of Ben Bernanke, material from the Wikileaks cables, prayers from bitcoin miners, and the original bitcoin Bitcoin mining hardware explained variance criminal activity[edit]

For broader coverage of this topic, see Cryptocurrency and security.

The use of bitcoin by criminals has attracted the attention of financial regulators, legislative bodies, law enforcement, and the media.[23] The FBI prepared an intelligence assessment,[24] the SEC has issued a pointed warning about investment schemes using virtual currencies,[23] and the U. S. Senate held a hearing on virtual currencies in November 2013.[25]

Several news outlets have asserted that the popularity of bitcoins hinges on the ability to use them to purchase illegal goods.[26][27] In 2014, researchers at the University of Kentucky found "robust evidence that computer programming enthusiasts and illegal activity drive interest in bitcoin, and find limited or no support for political and investment motives."[28]

Black markets[edit]

Main article: Darknet market

A CMU researcher estimated that in 2012, 4.5% to 9% of all transactions on all exchanges in the world were for drug trades on a single dark web drugs market, Silk Road.[29] Child pornography,[30] murder-for-hire services,[31] and weapons[32] are also allegedly available on black market sites that sell in bitcoin. Due to the anonymous nature and the lack of central control on these markets, it is hard to know whether the services are real or just trying to take the bitcoins.[33]

Several deep web black markets have been shut by authorities. In October 2013 Silk Road was shut down by U. S. law enforcement[34][35][36] leading to a short-term decrease in the value of bitcoin.[37] In 2015, the founder of the site was sentenced to life in prison.[38] Alternative sites were soon available, and in early 2014 the Australian Broadcasting Corporation reported that the closure of Silk Road had little impact on the number of Australians selling drugs online, which had Bitcoin mining hardware explained variance increased.[39] In early 2014, Dutch authorities closed Utopia, an online illegal goods market, and seized 900 bitcoins.[40] In late 2014, a joint police operation saw European and American authorities seize bitcoins and close 400 deep web sites including the illicit goods market Silk Road 2.0.[41] Law enforcement activity has resulted in several convictions. In December 2014, Charlie Shrem was sentenced to two years in prison for indirectly helping to send $1 million to the Silk Road drugs site,[42] and in February 2015, its founder, Ross Ulbricht, was convicted on drugs charges and faces a life sentence.[43]

Some black market sites may seek to steal bitcoins from customers. The bitcoin community branded one site, Sheep Marketplace, as a scam when it prevented withdrawals and shut down Bitcoin mining hardware explained variance an alleged bitcoins theft.[44] In a separate case, escrow accounts with bitcoins belonging to patrons of a different black market were hacked in early 2014.[45]

According to the Internet Watch Foundation, a UK-based charity, bitcoin is used to purchase child pornography, and almost 200 such websites accept it as payment. Bitcoin isn't the sole way to purchase child pornography online, Bitcoin mining hardware explained variance Troels Oertling, head of the cybercrime unit at Europol, states, "Ukash and paysafecard. have [also] been used to pay for such material." Bitcoin mining hardware explained variance, the Internet Watch Foundation lists around 30 sites that exclusively accept bitcoins.[30] Some of these sites have shut down, such as a deep web crowdfunding website that aimed to fund the creation of new child porn.[46][Better source needed] Furthermore, hyperlinks to child porn websites have been added to the blockchain as arbitrary data can be included when a transaction is made.[47][48]

Money laundering[edit]

Bitcoins may not be ideal for money laundering, because all transactions are public.[49] Authorities, including the European Banking Authority[50] the FBI,[24] and the Financial Action Task Force of the G7[51] have expressed concerns that bitcoin may be used for money laundering. In early 2014, an operator of a U. S. Bitcoin mining hardware explained variance exchange, Charlie Shrem, was arrested for money laundering.[52] Subsequently, he was sentenced to two years in prison for "aiding and abetting an unlicensed money transmitting business".[42] Alexander Vinnik, an alleged owner of BTC-e was arrested in Greece July 25 of 2017 on $4 billion money laundering charges for flouting anti-money laundering (AML) laws of the US. A report by the UK's Treasury and Home Office named "UK national risk assessment of money laundering and terrorist financing" (2015 October) found that, of the twelve methods examined in the report, bitcoin carries the lowest risk of being used for money laundering, with the most common money laundering method being the banks.[53]

Ponzi scheme[edit]

In a Ponzi scheme using bitcoins, the Bitcoin Savings and Trust promised investors up to 7% weekly interest, and raised at least 700,000 bitcoins from 2011 to 2012.[54] In July 2013, the U. S. Securities and Exchange Commission charged the company and its founder in 2013 "with defrauding investors in a Ponzi scheme involving bitcoin".[54] In September 2014 the judge fined Bitcoin Savings & Trust and its owner $40 million.[55]

See also[edit]

References[edit]

^"Charts". Blockchain. info. Archived from the original on 3 November 2014. Retrieved 2 November 2014.^ ABCDNakamoto, Satoshi (24 May 2009). "Bitcoin: A Peer-to-Peer Electronic Cash System"(PDF). Retrieved 20 December 2012.^ ABCDEBarber, Simon; Boyen, Xavier; Shi, Elaine & Uzun, Ersin (2012). "Bitter to Better – how to make Bitcoin a better currency"(PDF). Financial Cryptography and Data Security. Springer Publishing. doi:10.1007/978-3-642-32946-3_29.^"Bitcoin boom benefiting TSMC: report". Taipei Times. 4 January 2014.^Biggs, John (8 April 2013). "How To Mine Bitcoins". Techcrunch.^Gimein, Mark (13 April 2013). "Virtual Bitcoin Mining Is a Real-World Environmental Disaster". Bloomberg Business. Bloomberg LP. Retrieved 22 April 2015.^"The magic of mining". The Economist. 13 January 2015. Retrieved 13 January 2015.^"Cambridge Bitcoin Electricity Consumption Index (CBECI)". Www. cbeci. org. Retrieved 20 February 2020.^O'Brien, Matt (13 June 2015). "The scam called Bitcoin". Daily Herald. Retrieved 20 September 2016.^Potenza, Alessandra (21 December 2017). "Can renewable power offset bitcoin's massive energy demands?". TheVerge News. Archived from the original on 12 January 2018. Retrieved 12 January 2018.^Yang, Stephanie (29 March 2019). "Bitcoin in the wilderness". The Wall Street Journal. Retrieved 29 April 2020.^Orcutt, Mike (27 February 2020). "How Texas's wind boom has spawned a Bitcoin mining rush". MIT Technology Review. Retrieved 29 April 2020.^Antonopoulos, Andreas M. (2017). Mastering Bitcoin : programming the open blockchain (Second ed.). Sebastopol, CA. p. 239. ISBN . OCLC 953432201.^ ABRon Dorit; Adi Shamir (2012). "Quantitative Analysis of the Full Bitcoin Transaction Graph"(PDF). Cryptology ePrint Archive. Retrieved 18 October 2012.^ ABCJerry Brito & Andrea Castillo (2013). "Bitcoin: A Primer for Policymakers"(PDF). Mercatus Center. George Mason University. Retrieved 22 October 2013.^Erik Bonadonna (29 March 2013). "Bitcoin and the Double-spending Problem". Cornell University. Retrieved 22 October 2014.^Karame, Ghassan O.; Androulaki, Elli; Capkun, Srdjan (2012). "Two Bitcoins at the Price of One? Double-Spending Attacks on Fast Payments in Bitcoin"(PDF). International Association for Cryptologic Research. Retrieved 22 October 2014.^Michael J. Casey; Paul Vigna (16 June 2014). "Short-Term Fixes To Avert "51% Attack"". Money Beat. Wall Street Journal. Retrieved 30 June 2014.^Reid, Fergal; Harrigan, Martin (2013). "An Analysis of Anonymity in the Bitcoin System". Security and Privacy in Social Networks: 197–223. arXiv:1107.4524. doi:10.1007/978-1-4614-4139-7_10. ISBN .^ ABBiryukov, Alex; Khovratovich, Dmitry; Pustogarov, Ivan (2014). "Deanonymisation of clients in Bitcoin P2P network". ACM Conference on Computer and Communications Security. arXiv:1405.7418. Bibcode:2014arXiv1405.7418B.^ ABHouy, N. (2016). "The Bitcoin Mining Game". Ledger. 1: 53–68. doi:10.5195/ledger.2016.13. Retrieved 14 January 2017.^"How porn links and Ben Bernanke snuck into Bitcoin's code". CNN Money. CNN. 2 May 2013.^ ABLavin, Tim (8 August 2013). "The SEC Shows Why Bitcoin Is Doomed". Bloomberg. com. Bloomberg LP. Retrieved 20 October 2013.^ AB"Bitcoins Virtual Currency: Unique Features Present Challenges for Deterring Illicit Activity"(PDF). Cyber Intelligence Section and Criminal Intelligence Section. FBI. 24 April 2012. Retrieved 2 November 2014.^Lee, Timothy B. Bitcoin mining hardware explained variance November 2013). "Here's how Bitcoin charmed Washington". The Washington Post. Retrieved 10 October 2016.^"Monetarists Anonymous". The Economist. The Economist Newspaper Limited. 29 September 2012. Retrieved 21 October 2013.^Ball, James (22 March 2013). "Silk Road: the online drug marketplace that officials seem powerless to stop". Theguardian. com. Guardian News and Media Limited. Retrieved 20 October 2013.^Matthew Graham Wilson Bitcoin mining hardware explained variance Aaron Yelowitz (November 2014). "Characteristics of Bitcoin Users: An Analysis of Google Search Data". Social Science Research Network. Working Papers Series. SSRN 2518603.^Christin, Nicolas (2013). Bitcoin mining hardware explained variance the Silk Road: A Measurement Analysis of a Large Anonymous Online Marketplace(PDF). Carnegie Mellon INI/CyLab. p. 8. Retrieved 22 October 2013. ^ ABSchweizer, Kristen (10 October 2014). "Bitcoin Payments by Pedophiles Frustrate Child Porn Fight". BloombergBusiness. Bloomberg LP. Retrieved 16 February 2015.^Lake, Eli (17 October 2013). "Hitman Network Says It Accepts Bitcoins to Murder for Hire". The Daily Beast. The Daily Beast Company LLC. Retrieved 17 February 2015.^Smith, Gerry (15 April 2013). "How Bitcoin Sales Of Guns Could Undermine New Rules". Huffingtonpost. com. TheHuffingtonPost. com, Inc. Retrieved 20 October 2013.^Alex, Knapp (19 January 2015), "Faking Murders And Stealing Bitcoin: Why The Silk Road Is The Strangest Crime Story Of The Decade", Forbes, retrieved 2 January 2016^Andy Greenberg (23 October 2013). "FBI Says It's Seized $28.5 Million In Bitcoins From Ross Ulbricht, Alleged Owner Of Silk Road"(blog). Forbes. com. Retrieved 24 November 2013.^Kelion, Leo (12 February 2014). "Five arrested in Utopia dark net marketplace crackdown". Bbc. co. uk. BBC. Retrieved 13 February 2014.^Alex Hern (3 Bitcoin mining hardware explained variance 2013). "Bitcoin price plummets after Silk Road closure". The Guardian. Retrieved 31 October 2014. ^Robert McMillan (2 October 2013). "Bitcoin Values Plummet $500M, Then Recover, After Silk Road Bust". Wired. Retrieved 31 October 2014.^"Silk Road drug website founder Ross Ulbricht jailed". BBC News. BBC. 29 May 2015. Retrieved 30 May 2015.^Katie Silver (31 March 2014). "Silk Road closure fails to dampen illegal drug sales online, experts Bitcoin mining hardware explained variance. ABC News. Retrieved 31 October 2014.^Sophie Murray-Morris (13 February 2014). "Utopia no more: Drug marketplace seen as the next Silk Road shut down by Dutch police". The Independent. London: independent. co. uk. Retrieved 8 November 2014.^Wakefield, Jane (7 November 2014). "Huge raid to shut down 400-plus dark net sites". Bbc. com. BBC. Retrieved 8 November 2014.^ ABNate Raymond (19 December 2014). "Bitcoin backer gets two years prison for illicit transfers". Reuters. Thompson Reuters. Retrieved 20 December 2014.^"Ross Ulbricht: Silk Road creator convicted on drugs charges". BBC. 5 February 2015. Retrieved 17 February 2015.^A diagram of a bitcoin transferNumber of bitcoin transactions per month (logarithmic scale)[1]An actual bitcoin transaction including the fee from a webbased cryptocurrency exchange to a hardware wallet.The best chain      consists of the longest series of transaction records from the genesis block      to the current block or record. Orphaned records      exist outside of the best chain.GPU-based mining rig, 2012Lancelot FPGA-based mining board, 2013Mining difficulty has increased significantlyAvalon ASIC-based mining machineDiagram showing how bitcoin transactions are verified

A new proof-of-work mechanism for bitcoin | SpringerLink

Bitcoin Mining Hardware Guide

Price. Global Vol. Diff.

The best Biitcoin mining hardware has evolved dramatically since 2009

At first, miners used their central Processing unit (CPU) to mine, but soon this wasn't fast enough and it bogged down the system resources of the host computer. Miners quickly moved on to using the Graphical processing unit (GPU) in computer graphics cards because they were able to hash data 50 to 100 times faster and consumed much less power per unit of work.

During the winter of 2011, a new industry sprang up with custom equipment that pushed the performance standards even higher. The first wave of these specialty bitcoin mining devices were easy to use Bitcoin mining hardware explained variance miners were based on field-programmable gate array (FPGA) processors and attached to computers using a convenient USB connection.

FPGA miners used much less Bitcoin mining hardware explained variance than CPU's or GPU's and made concentrated mining farms possible for the first time.

Today's modern and best bitcoin mining hardware

Application-specific integrated circuit (ASIC) miners have taken over completely. These ASIC machines mine at unprecedented speeds while consuming much less power than FPGA or GPU mining rigs. Several reputable companies varince established themselves with excellent products.

Bitcoin Mining Hardware Comparison

Currently, based on (1) price per hash and (2) electrical efficiency the best Bitcoin miner options are:

For a comprehensive comparison of bitcoin mining hardware.

Best Bitcoin Mining Hardware

Two major factors go into determining the best bitcoin mining hardware: (1) cost and (2) electricity efficiency.

Bitcoin mining is difficult to do profitably but if you try then this Bitcoin miner is probably a good shot.

ASIC Bitcoin Mining Hardware

Application-specific integrated circuit chips (ASICs) are bitcoin mining hardware created solely to solve Bitcoin blocks. They have only minimal requirements for other normal computer applications. Consequently, ASIC Bitcoin mining systems can solve Bitcoin blocks much quicker and use less less electricity or power than older bitcoin mining hardware like CPUs, GPUs or FPGAs.

As Bitcoin mining increases in popularity and the Bitcoin price rises so does the value of ASIC Bitcoin mining hardware. As more Bitcoin mining hardware is deployed to secure the Bitcoin network the Bitcoin difficulty rises. This makes it impossible to profitably compete without a Bitcoin ASIC system. Furthermore, Bitcoin ASIC technology keeps getting faster, more efficient and bitcoinn productive so it keeps pushing the limits of what makes minihg best Bitcoin mining hardware.

Some models of Bitcoin miners include Antminer S5, Antminer Bitcoin mining hardware explained variance, ASICMiner BE Tube, ASICMiner BE Prisma, Avalon 2, Avalon 3, BTC Garden AM-V1 616 GH/s, VMC PLATINUM 6 MODULE, and USB miners.

Best Bitcoin Cloud Mining Services

For those not interested in operating the actual hardware then they can purchase Bitcoin cloud mining contracts. Being listed in this section is NOT an endorsement of these services. There have been mmining tremendous Bitcoin mining hardware explained variance of Bitcoin cloud mining scams.

Hashflare Minig Hashflare offers SHA-256 mining contracts and more profitable SHA-256 coins can be mined while automatic payouts are still in BTC. Customers must Bitcoin mining hardware explained variance at least 10 GH/s.

Genesis Mining Review: Genesis Mining is the largest Bitcoin and scrypt cloud mining Bitcoin mining hardware explained variance. Genesis Mining offers three Bitcoin cloud mining plans that are reasonably priced. Zcash mining contracts are also available.

Hashing 24 Review: Hashing24 has been involved with Bitcoin mining since 2012. They have facilities in Iceland and Georgia. They use modern ASIC chips from BitFury deliver the maximum performance and efficiency possible.

Minex Review: Minex is an innovative aggregator of blockchain projects presented in an economic simulation game format. Users purchase Cloudpacks which can then be used to build an index from pre-picked sets of cloud mining farms, lotteries, casinos, real-world markets and much more.

Minergate Bitcoin mining hardware explained variance Offers both pool and merged mining and cloud mining services for Bitcoin.

Hashnest Review: vatiance is operated by Bitmain, the producer of the Antminer line of Bitcoin miners. HashNest currently has over 600 Antminer S7s for rent. You can view the most up-to-date pricing Bitcoin mining hardware explained variance availability on Hashnest's website. At the time of writing one Antminer S7's hash rate can be rented for $1,200.

Bitcoin Cloud Mining Review: Currently all Bitcoin Cloud Mining contracts are sold out.

NiceHash Bitcoin mining hardware explained variance NiceHash is unique in that it uses an orderbook to match mining contract buyers and sellers. Check its website for up-to-date prices.

Eobot Review: Start cloud mining Bitcoin with as little as $10. Eobot claims customers can break even in 14 months.

MineOnCloud Review: MineOnCloud currently has about 35 TH/s of mining equipment for rent in the cloud. Some miners available for rent include AntMiner S4s and S5s.

Full List of Mining Hardware

MinerCapacityEfficiencyPrice

AntMiner S1	180 Gh/s	2.0 W/Gh minign N/A
AntMiner S2	1000 Gh/s	1.1 W/Gh	N/A
AntMiner S3	441 Gh/s	0.77 W/Gh	N/A
AntMiner S4	2000 Gh/s	0.7 W/Gh	N/A
AntMiner S5	1155 Gh/s	0.51 W/Gh	N/A
AntMiner S5+	7722 Gh/s	0.44 W/Gh	N/A
AntMiner S7	4.73 Th/s	0.25 W/Gh	N/A
AntMiner S9	13.5 Th/s	0.098 W/Gh	N/A
AntMiner U1	2 Gh/s	1.25 W/Gh	N/A
AntMiner U2	2 Gh/s	1.0 W/Gh	N/A
AntMiner U3	63 Gh/s	1.0 W/Gh	N/A
ASICMiner BE Blade	11 Gh/s	7.72 W/Gh	N/A
ASICMiner BE Cube	30 Gh/s	6.67 W/Gh	N/A
ASICMiner BE Sapphire	0 Gh/s	7.59 W/Gh	N/A
ASICMiner BE Tube	800 Gh/s	1.13 W/Gh	N/A
ASICMiner BE Prisma	1400 Gh/s	0.79 W/Gh	N/A
Avalon Batch 1	66 Gh/s	9.35 W/Gh	N/A
Avalon Batch 2	82 Gh/s	8.54 W/Gh	N/A
Avalon Batch 3	82 Gh/s	8.54 W/Gh	N/A
Avalon2	300 Gh/s avriance	Uardware	N/A
Avalon3	800 Gh/s	N/A	N/A
Avalon6	3.5 Th/s	0.29 W/Gh	N/A
Bi*fury	Bitcoin mining hardware explained variance 5 Gh/s	0.85 W/Gh	N/A
BFL SC 5Gh/s	5 Gh/s	6.0 W/Gh	N/A
BFL SC 10 Gh/s	10 Gh/s	N/A	N/A
BFL SC 25 Gh/s	25 Gh/s	6.0 W/Gh	N/A
BFL Little Single	Bitcoin mining hardware explained variance 30 Gh/s	N/A	N/A
BFL SC 50 Gh/s	50 Gh/s	6.0 W/Gh	N/A
BFL Single 'SC'	60 Gh/s	4.0 W/Gh	N/A
BFL 230 GH/s Rack Mount	230 Gh/s	N/A	N/A
BFL 500 GH/s Mini Rig SC	500 Gh/s	5.4 W/Gh	N/A
BFL Monarch 700GH/s	explaiined Gh/s	0.7 W/Gh	N/A
BitFury S. B.	N/A	N/A	N/A
Bitmine. ch Avalon Clone 85GH	85 Gh/s	7.65 W/Gh	N/A
Black Arrow Prospero X-1	100 Gh/s	1.0 W/Gh	N/A
Black Arrow Prospero X-3	2000 Gh/s	1.0 W/Gh	N/A
Blue Fury	3 Gh/s	1.0 W/Gh	N/A
BTC Garden AM-V1 310 GH/s	310 Gh/s	1.05 W/Gh	N/A
BTC Garden AM-V1 616 GH/s	616 Gh/s	1.05 W/Gh	N/A
CoinTerra TerraMiner IV	1600 Gh/s	1.31 W/Gh	N/A
Drillbit	N/A	N/A	N/A
HashBuster Micro	20 Gh/s	1.15 W/Gh	N/A
HashBuster Nano	N/A esplained	N/A	N/A
HashCoins Apollo v3	1100 Gh/s	0.91 W/Gh	N/A
HashCoins Zeus v3	esplained Gh/s Bitcoin mining hardware explained variance	0.67 W/Gh	N/A
HashFast Baby Jet	400 Gh/s	1.1 W/Gh	N/A
HashFast Sierra	1200 Gh/s	1.1 W/Gh	N/A
HashFast Sierra Evo 3	2000 Gh/s	1.1 W/Gh	N/A
Klondike	5 Gh/s	6.15 W/Gh	N/A
KnCMiner Mercury	100 Gh/s	2.5 W/Gh	N/A
KnC Saturn	250 Gh/s	1.2 W/Gh	N/A
KnC Jupiter	500 Gh/s	Bitcoin mining hardware explained variance W/Gh	N/A Bitcoin mining hardware explained variance Neptune	3000 Gh/s	0.7 W/Gh	N/A
LittleFury	N/A	N/A	N/A
Metabank	120 Gh/s Bitcoin mining hardware explained variance	1.42 W/Gh	N/A
NanoFury / Vxriance 2 Gh/s	1.25 W/Gh	N/A
NanoFury NF2	4 Bitcoin mining hardware explained variance	1.35 W/Gh	N/A
BPMC Red Fury USB	miniing Bitcoin mining hardware explained variance Gh/s	0.96 W/Gh	Bitcoin mining hardware explained variance
ROCKMINER R3-BOX	450 Gh/s	1.0 W/Gh	N/A
ROCKMINER R4-BOX	470 Gh/s	1.0 W/Gh	N/A
ROCKMINER Rocket BOX	450 Gh/s	hardwaare W/Gh	N/A
ROCKMINER R-BOX	rxplained 32 Gh/s hardaare	1.41 W/Gh	N/A
ROCKMINER R-BOX Bitcoin mining hardware explained variance 110 Gh/s bitcoln	1.09 W/Gh	N/A
ROCKMINER T1 800G	800 Gh/s	1.25 W/Gh	N/A
Spondooliestech SP10 Dawson	1400 Gh/s exxplained	0.89 W/Gh	N/A
SP20 Jackson	1.3-1.7 Th/s	0.65 W/Gh	N/A
Spondooliestech SP30 Yukon	4500 Bitcoin mining hardware explained variance	0.67 W/Gh	N/A
Spondooliestech SP31 Yukon	4900 Gh/s	0.61 W/Gh	N/A
Spondooliestech SP35 Yukon	eplained Gh/s	0.66 W/Gh	N/A
TerraHash Klondike 16	Bitcoin mining hardware explained variance 5 Gh/s	7.11 W/Gh	N/A
TerraHash Klondike 64	Bitcoin mining hardware explained variance 18 Gh/s	7.06 W/Gh	N/A
TerraHash DX Mini (full)	90 Gh/s	7.11 W/Gh	N/A
TerraHash DX Large (full)	180 Gh/s	7.11 W/Gh	N/A
Twinfury	5 Gh/s	0.85 W/Gh	N/A
Avalon USB Nano3	3.6 Gh/s	0.85 W/Gh	N/A
GekkoScience	9.5 Gh/s	0.33 W/Gh	N/A