1.Because they spend money for electricity they must take care everithing to be by the rules to to take rewards - if they try to cheat they will lose money and no rewards
2.If someone change the block - it will change hash of the next block and hush of all network what is almost impossible- (he will need 51% of the hash power).
3.When more miners are connected on the network than bigger is hashing power and low target to guess nonce-- so hash of (nonce together with previous hash and transaction hash) to be lower than hash target.
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Miners spending money on large amounts of electricity ensures that they guess the nonce and follow along with the blockchain to clear the transaction so they can collect their fee, solidifying incentive in honesty
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One of the requirements of creating a new block in the blockchain is taking the hash from the previous block and applying it to the one you’re trying to create. To go back and change one hash would require you to essentially rewrite an entire new blockchain based on your new hash by guessing new hashes to keep up with the new blocks being connected to the blockchain, which is in practice is impossible
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Mining difficulty is regulated in a couple ways, one of them being lower “targets” for nonces, which have to be below the hash. The nonce is lowered based on the amount of miners attempting to mine the block, the lower the number the harder it is to guess which requires electricity that miners have to pay for. So while miners make heavy profits there’s always something that requires them to pay for which is the foundation of their incentive to keep the system going. The other being the halving event, which happens after a certain amount of blocks are produced and reduces the amount of block produced per minute, which is more energy miners need to do their job to pay for
The nonce is just a random number a Miner has to guess and add in the block in order the entire blockhash is below target.
You probably mean the target is lowered based on the amount of miners…
In practice, it means the blockhash has to be low enough starting with a bunch of leading zero’s
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- to create pow. if they try to amend previous data, their block is rejected and they are at a loss considering the mining costs in electricity.
- because of how hashing works, they would need to control more than 51% of the hashrate in order to, at the same time change the block and re-mine all subsequent blocks to present.
- through target adjustment
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- It is important to make sure that miners spend money on electricity because it forces them to have “skin in the game” and financially incentives them to play by the rules.
- It would be difficult for someone to go back and change a previous block because it would break the link to the previous block and all following blocks.
- The network regulates mining difficulty by lowering the nonce target.
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- It is important to make sure that miners spend money (on electricity) while mining, because by this principle the miner first has to put in effort in order to get the possible rewards afterwards. This again makes sure that a miner plays by the network rules and therefore the network can accept the block. This can be regarded as the safety of the network.
- It would be very difficult for someone to go back to change a previously added block, becaus: a) other miners continue to mine to a longer blockchain and b) by changing a previous block, the chainlinks untill that block will be broken and your version of the chain is shorter.
A and b together makes the miner’s so much harder because he needs to build the chain up again untill the previous lenght + the other’s work in order to restore a longer chain. By doing so, you need more than half of the hashrate which is very difficult. - The network regulates mining difficulty by maintainig an equal sum of hashrate and target. Therefore, if hashrate goed up, the target goes down by the same amount socthat difficulty rises. If hashrate goes up, so does difficulty in order to make sure that a block gets mined only every 10 minutes and not sooner.
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- They are incentivised to earn money and they can only do that by playing by the rules. If it didn’t cost anything miners could play around without creating anything valuable.
- because they would have to change all that comes after and that would take an infinite amount of time as others are still creating.
- mining difficulty depends on the target. If the target is low it is hard.
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- So they secure network, by guessing nonce, and getting reward for that.
- It would be difficult because that new mined block must have recalculated hash, also the blocks that came after him. In the meantime new blocks will be mined faster and appended to blockchain while that block will be rejected.
- By lowering the target
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So that they have a reason to follow the rules and not break them
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Because of the proof of work. Once someone change a block, everything else will change and he would have to do the same for the other blocks.
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By setting up a target and miners have to guess the nonce
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By spending electricity, the miners are incentivised to recoup their costs and make a profit.
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Making changes to a prior block changes the output hash, which in turn invalidates all the following blocks. They would then have to re-mine all the invalid blocks, and try to catch up with the blocks that are being mined by all the other miners, which would take far too long to make it viable.
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Difficulty is adjusted according to to the total hash rate of all miners on the network. The more active miners there are, the quicker a block can be mined due to the increased computing power, so difficulty is adjusted to target an approximate 10 minute solution time. The higher the hash rate, the more difficult the task.
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- Miners are incentivized to play by the consensus rules when mining, so they can pay the electricity bills.
- It is time consuming to do so because you would have to go back and re-hash all previous blocks and while you’re doing that recovering data and rehashing the previous blocks the other miners blocks are in increasing in size and will be completing new blocks. Not very practical or financially profitable.
3.Network regulates mining difficulty by lowering and increasing the target. Higher difficulty means lower target. Lower difficulty means higher target.
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This is all about incentives. The electricity costs will encourage miners to follow the rules of mining. If the rules are not followed, the mined blocks will not be accepted to the network and there will be no reward.
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In order to go back and change a previous block, the link will be broken and the miner is going to re-mine the broken blocks and catch-up to the current blocks. At the same time, new blocks are constantly created. This demands very high hashpower almost impossible to achieve.
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Mining difficulty will be adjusted according to the hashrate. When there is more miners, the difficulty level will increase, and vice versa.
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Homework on Mining and Proof of Work - Questions
- Why is it important to make sure that miners spend money (on electricity) while mining?
Because the need to be motivated to recover their cost and then make a profit by getting the block reward and trx fee. Miners are incentivised to follow the rules. - Why would it be very difficult for someone to go back change a previously added block?
You would need to change all blocks going going forward to the most recent one. This is very difficult because you need also to catch up on the added new blocks. It requires to much hashing power to work against it. - How does the network regulate mining difficulty?
By adjusting the target. Many miners mean that guessing a nonce becomes more difficult. The target is the lower.
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- To make sure they are invested
- Because it would invalidate the chain and the changes would be either thrown out or changes would be invalidated.
- The more miners on the chain the more difficult it is to find the nonce to validate the block.
1.Mining is about financial incentive and economic viabilty if a miner does’nt have to spend he’ll be incentivized to trick the system in order to profit without consequens on his behalf and totaly damage the system and its reliabilty.
2. A) It’s a must have for a stable and reliable system
B) It would technically be so due to the mutual dependece of the blocks and the endless redundant time it consumes to adjust to proceeding blocks.
3.I believe that the network actions define the target’s declining number.
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It is incentive to make more money back to cover their electricity bills and investment in hardware
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It would be very expensive and financially non beneficial to invest such amounts in hardware and electricity to achieve 51% of the network and to be able to make any changes in the blockchain. It would be way more beneficial to participate in network, play by rules and get rewarded.
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Mining difficulty depends of the amount of miners participating in the network. Network regulates difficulty by lowering target.
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This incentivises the miners to not cheat. It also makes the system more robust to tamper with because resources have to be spent to make changes. These changes get exponentially more expensive to carry out the further back along the chain that you want to make changes to.
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You would have to make the changes and calculate the hashes of that particular block on your own and each subsequent block while the network is currently actively mining new blocks. It makes it extremely difficult to achieve this result without expending large amounts of money. Money that would be more useful in actually buying bitcoin.
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As the number of miners increase and the network hashes increases it sets the difficulty number lower. In effect reducing the probability that someone can easily guess a nonce that would be below a certain threshold.
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It ensures honesty by making them loose money if their block is not accepted.
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It would take too much time
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A new block should be created and added to the chain every 10 minutes. So the higher the hashing power in the network the higher the difficulty must be, hence adding more work by lowering the target.
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Why is it important to make sure that miners spend money (on electricity) while mining?
To make sure that miners have incentive to follow the rules and make profit on blocks. -
Why would it be very difficult for someone to go back change a previously added block?
Because with every change to a block it changes the hash of that block and every block made after. -
How does the network regulate mining difficulty?
The more miners, that lower the target of the nonce and thus the more difficult.
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It is important to make sure miners spend money on electricity while mining because it when miners spend money on electricity it incentivizes miners to want to recoup the cost by earning the reward rather than trying to cheat the blockchain.
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Changing any transactions in a previous block would change the hash for the block and subsequent blocks because subsequent block hashes are based on previous hashes, hence corrupting blocks after changed block and making it apparent to network something has changed.
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The network regulates mining difficulty by setting a target that the hash must be less than. The lower the target for the hash the higher the miner difficulty because more guesses or electricity are needed to guess a correct hash in that range.
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