Explaining Hash Rate
Or Hash Power In
Cryptocurrencies
By: " Sudhir Khatwani
In: # Bitcoin Last Updated: $ 2/01/2018
(10 Comments)
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If you are new to the world of
cryptocurrencies, I guess you
would have heard this number
of times that Bitcoin
Bitcoin’s
’s hash
rate
rate, also referred to as hash
power, has increased or come
down. Does the term make you
wonder what it actually means?
I actually used to wonder in my
initial days as to what Bitcoin’s
hash rate/power actually
means. And eventually, after
learning a lot of stuff about
Bitcoin, I was able to
understand the reference.
Hash rate or hash power is
something very critical and
integral to Bitcoin’s network for
a number reasons, that I will
explain further in this article.
But before that, it is very
important that one understands
what this actually means
because by doing so one will
be able to naturally understand
why this hash rate/power
matters so much.
Note: Hash rate/ hash power is
used in every cryptocurrency
that is proof of work but for this
example, I am using Bitcoin
because most of us naturally
connect to this cryptocurrency.
What Is Hash Rate Or
Hash Power?
Hash Rate, also Hash Power, is
the measuring unit that
measures how much power
Bitcoin network is consuming to
be continuously functional. By
continuously functional I mean
how much hash power is it
consuming to generate/find
blocks at the normal mean time
of 10 minutes.
If you remember, in my
previous article What is a
Bitcoin hash I explained
thoroughly that Bitcoin network
consumes a lot of energy
because it has to solve
mathematical intensive
computations regularly to find
the blocks.
These computations for finding
the blocks are basically
mathematical puzzles that a
miner cannot just guess without
a lot of computation.
To successfully mine a block, a
miner needs to hash the block’s
header in such a way that it is
less than or equal to the
“target.”
The target, at the time of writing
this article, is that the SHA-256
hash of a block’s header must
be a 256-bit alphanumeric
string, and must start with 18
zeros. The target changes as
the difficulty change every 2016
blocks.
And the miners arrive at this
particular hash (or target) by
varying a small portion of the
block’s headers, which is called
a “nonce.” A nonce always
starts with “0” and is
incremented every time for
obtaining the required hash (or
target).
Since the varying of the nonce
is hit and miss, the chances of
getting this particular hash (or
target), which starts with these
many zeros, is very low.
Therefore, many attempts must
be made by a miner by varying
the nonce.
And this number of attempts
made per second is called hash
rate or hash power. And this
hash power or guessing
attempts are made by miners
who mine the Bitcoin blocks by
a process called Bitcoin
mining.
To understand more about
hash power see this short video
on hash power or hash rate
which perfectly explains it.
How Is The Hash Rate
Measured & its Unit?
Hash rate, as I said, is a unit
measured in hashes per
second or [h/s] and here are
some usual denominations
used to refer it.
Hash rate denominations
○
1 kH/s is 1,000 (one
thousand) hashes per
second
○
1 MH/s is 1,000,000 (one
million) hashes per second.
○
1 GH/s is 1,000,000,000
(one billion) hashes per
second.
○
1 TH/s is
1,000,000,000,000 (one
trillion) hashes per second.
○
1 PH/s is
1,000,000,000,000,000
(one quadrillion) hashes per
second.
○
1 EH/s is
1,000,000,000,000,000,000
(one quintillion) hashes per
second.
Comman Hash rate
Conversions
○
1 MH/s = 1,000 kH/s
○
1 GH/s = 1,000 MH/s =
1,000,000 kH/s
○
1 TH/s = 1,000 GH/s =
1,000,000 MH/s =
1,000,000,000 kH/s
○
and so forth
Bitcoin Network’s Hash
Rate & Distribution As Of
Now?
This is the Bitcoin’s hash rate
distribution.
Bitcoin network’s hash rate now
is 9.9 TH/s and is only growing
as the more miners are joining
in so more difficulty is going up.
Hash Rate, Miner’s Reward
And Difficulty
Hash rate, miner’s reward, and
difficulty are interdependent on
each other in various ways.
Whenever Bitcoin network’s
difficulty goes up more hash
rate is required to mine/find the
blocks and as result miners
earn the block reward of 12.5
BTC plus the transaction fees.
Interestingly, the Bitcoin
network’s difficulty goes up
because of more miners joining
the network and thus the hash
power needs to be increased
(i.e. more computational
guesses needs to be made per
second to find the solution).
This interesting correlation is
enforced in the Bitcoin protocol
itself so that the average block
time remains 10 minutes.
0After reading this, some of you 1
would want to mine bitcoins by
providing hash power to the
Bitcoin network but that is a
very costly and energyintensive affair which
everyone cannot do. It
requires you to make
expensive hardware
investments, pay for huge
electricity bills, and demands
that you have a good amount of
computer knowledge.
And until you are ready to
become a miner, keep working
hard in your current profession,
HODL Bitcoin and stay tuned
to CoinSutra to keep learning
more about the Bitcoin
revolution.
Like this post? Don’t forget
to share it!
For further reading:
○
What is a Bitcoin Hash?
○
What is Proof-Of-Work &
Proof-Of-Stake?
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Authored By SUDHIR
KHATWANI
Hey there! I am Sudhir
Khatwani, an IT bank
professional turned into a
cryptocurrency and blockchain
proponent from Pune, India.
Cryptocurrencies and
blockchain will change human
life in inconceivable ways and I
am here to empower people to
understand this new ecosystem
so that they can use it for their
benefit. You will find me reading
about cryptonomics and eating
if I am not doing anything else.
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