Book Image

Bitcoin Essentials

By : Albert Szmigielski
Book Image

Bitcoin Essentials

By: Albert Szmigielski

Overview of this book

Blockchain is being billed as the technology of the future. Bitcoin is the first application of that technology. Mining is what makes it all possible. Exploring mining from a practical perspective will help you make informed decisions about your mining setup. Understanding what the future may hold for blockchains, and therefore for mining, will help you position yourself to take advantage of the impending changes. This practical guide starts with an introduction to Bitcoin wallets, as well as mining hardware and software. You will move on to learn about different mining techniques using the CPU, GPU, FPGA, and ultimately the ASIC as an example. After this, you will gain an insight into solo mining and pool mining, and see the differences between the two. The book will then walk you through large-scale mining and the challenges faced during such operations. Finally, you will take a look into the future to see a world where blockchain-based applications are commonplace and mining is ubiquitous.
Table of Contents (15 chapters)
Bitcoin Essentials
Credits
About the Author
About the Reviewer
www.PacktPub.com
Preface
Index

Profitability of GPU mining


To calculate expected rewards from mining, we can do the following. First, calculate what percentage of total hashing power you command. To look up the network mining speed, execute the getmininginfo command in the console of the Bitcoin Core wallet. We will do our calculations with a GPU that can hash at 1 GH/s = 0.1 TH/s. If the Bitcoin network hashes at 400,000 TH/s, then our proportion of the hashing power is:

0.1 / 400 000 = 0.00000025 of the total mining power

On average, a Bitcoin block is found every 10 minutes; it amounts to six per hour and 144 for a 24-hour period. The current reward per block is 25 BTC; therefore, in a day we have 144*25 = 3600 BTC mined.

If we command a certain percentage of the mining power, then on average we should earn that proportion of the newly minted bitcoins.

Multiplying our portion of hashing power by the number of bitcoins minted daily we arrive at:

0.00000025 * 3600 BTC = 0.0009 BTC

As we can see, this is less than $0.25 USD...