Observation | With over 2 million mining machines, is it difficult for a Bitcoin mine?

Source of this article: Golden Finance , the original title "Golden Observation | More than 2 Million Mining Machines Read the article to understand whether there will be bitcoin mining difficulties"

Author: Maxwell

The plunge in Bitcoin prices on March 12-13 is still reflected in Bitcoin's hashrate.

According to Bitinfocharts data, the computing power of the Bitcoin network has fallen below 100EH / s. As of press time, the total computing power of the Bitcoin network is 96.6EH / s, which is 27% lower than the historical high of 133EH / s on March 5, 2020 . . If calculated on the basis of 13T computing power, there have been 2.8 million ants S9 mining machines recently.

Bitcoin hashrate chart source: Bitinfocharts

According to F2Pool data, at the current currency price and difficulty, at 0.38 yuan / kWh, the mainstream mainstream mining machines such as Ant S9, Shenma M3, and Ant T9 + have all been shut down. Electricity charges account for more than 90%, and are already on the verge of shutdown.

Source of mainstream mining machine currency price: F2Pool

It seems that mining is experiencing mining disasters. The cryptocurrency circle has also been worried about the bitcoin mining disaster, but what exactly is the bitcoin mining disaster, in fact, people are far from clear.

Let's start with the basic concepts of Bitcoin computing power and difficulty adjustment.

Bitcoin hashrate and difficulty adjustment

Computing power, as the name suggests, can be simply understood as computing power. For Bitcoin's SHA256 algorithm, "computing power" is how many hash collisions a miner can do per second. The unit is hash / s. When we say that a mining machine has a computing power of about 13T, it actually means that this mining machine can do 13 times 10 times 14 times hash collisions.

Blockchain block is a data structure, which is mainly composed of block header and transaction list. The following figure is a schematic diagram of the Bitcoin blockchain.

The four processes of Bitcoin mining: verify and screen transactions, calculate Merkle root, calculate block headers, and exhaust nonce from 0-2 ^ 32. The miner calculates the hash value of the block header information to see if it is less than the current target value. If the hash value is not less than the target value, the miner will modify the nonce (usually adding 1) and try to exhaust the nonce again. If the result obtained is less than the difficulty target specified in the block header, that is, mining is successful, Get block rewards.

The Bitcoin system stipulates that the Bitcoin network will adjust the difficulty every 2016 blocks. Make sure that no matter how large or small the computing power is, a new block is generated on average in 10 minutes. In other words, we adjust the difficulty once every 14 days (20160 minutes).

When adjusting the difficulty, Bitcoin will compare whether the actual generation time of the previous 2016 blocks is greater than 20160 minutes (that is, the expectation of one block every 10 minutes). If the average generation time of the previous 2016 blocks is less than 10 minutes, the network will increase the difficulty, and vice versa, it will reduce the difficulty.

Calculation formula: New target value (Target) = old target value * (20160 minutes / actual block time of the previous 2016 blocks)

At the same time, in order to prevent the difficulty from changing too quickly, the adjustment range of each cycle must be less than a factor with a value of 4, and the new difficulty range is between 25% and 400% of the old difficulty. If the adjustment range is greater than 4, adjust it by 4 times. In other words, if the time is less than 5040 minutes, it is calculated as 5040 minutes; if the time is more than 80640 minutes, it is calculated as 80640 minutes.

In other words, if the miner shuts down and causes a decrease in computing power in a difficulty cycle, the block production time of 2016 blocks in this cycle will be greater than 20160 minutes, which will cause the adjustment cycle to be greater than 14 days.

So after the Bitcoin crash on March 12, Pan Zhibiao, a coin-printing mining pool, said, "If the computing power drops by 30%, it will be adjusted after 16 days , and miners must make at least half a month of cash flow."

Of course, finding a result that meets the requirements through hash operations depends not only on the size of the entire network's computing power, but also on luck. Bitcoin occurred on March 12 for more than an hour, and many netizens thought that it was caused by the sharp drop in the price of the currency and the panic shutdown of miners, which caused the instantaneous decline in computing power. However, the block generation time of the next few blocks was only a few minutes.

However, if the computing power declines, Bitcoin's block production time will indeed be greater than 10 minutes. As of press time, btc.com data shows that a large percentage of the block block production time is greater than 10 minutes.

Bitcoin's latest block time is more than 10 minutes. Source: btc.com

What is called a mine disaster?

Bitcoin's hashrate is now 27% lower than March 5. Is there a mining disaster?

Wen Hao, the founder of Bite Wallet, told Golden Finance that the so-called mining disasters are a large part of the old version of high-energy-consuming miners that had to be shut down because the cost was greater than the electricity price, resulting in a sharp decline in computing power . This is a normal economic phenomenon because of the mining disaster caused by the plummeting prices. Miners have to shut down after losing money.

And Zhu Yin, the co-founder of Coin India, said that the mine disaster must be a catastrophic shutdown. If the mining machine has been dug for several years, it will be called a disaster if it is turned back several times. Not called at all. New mining rigs with low electricity costs were forced to shut down in large areas before they were called mining disasters. The mines with the highest electricity bills have no advantage, and some of these mines are not a problem.

Of course, this is also the redistribution of computing power among miners. The same amount of bitcoin is produced, and the old mining machine will increase the number of bitcoins mined by the new mining machine. However, based on the currency standard, the net income of the new mining machine will increase and decrease is more complicated, and it is also related to the currency price and electricity costs.

If the currency price does not change after halving, there will indeed be more opportunities for mining. The specific impact depends on the evaluation of the situation, depending on how much of the computing power of the old mining machine is turned off, what is the ratio of your new computing power to the computing power of the entire network, electricity costs, and so on.

Will it affect Bitcoin network security?

Wen Hao told Golden Finance that the mining disaster itself will not affect the security of the Bitcoin network, and the rapid decline of computing power will affect the block production speed in a period of difficulty, but eventually the Bitcoin network will stabilize to a more reasonable status.

According to the above description of Bitcoin computing power and difficulty adjustment, it can be known that the Bitcoin network will automatically adjust for the state of the network computing power to reach a new balance again. If a large-scale shutdown of the mining machine's computing power occurs, the main impact will be on the income of the miners, and the Bitcoin network will continue to operate.

It can be more exaggerated to imagine that even if the computing power of the Bitcoin network is now halved, the possible impact is that the time of this difficulty cycle will be much longer than 14 days, but the difficulty will be reduced next time, and the block production time of Bitcoin will be accelerated. 10 minutes.

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