Homework on Mining and Proof of Work - Questions

Blockchain and Bitcoin 101
#4379

I always look out for your answers, brilliant smart man, i admire your intelligence and pattern of thinkingšŸ˜‚

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#4380

  1. Well itā€™s important so they are incentivized to be truthful and obey the protocol of the network to receive block rewards and transaction fees.

  2. It would be very difficult because of the consensus algorithm and unidirectional hash function inbuilt in the blockchain.

  3. The network regulates mining difficulty this way; when thereā€™s so many miners in the network trying to get block rewards and txn fees, resulting in high hashing rate, then the threshold or target level is reduced thereby increasing mining difficulty so finding the nonce is hard, but when there are fewer miners in the network, mining difficulty is reduced.

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#4381
  1. Spending money in front is the way to make them follow the rules.
  2. He/she will need to mine all the next blocks again and all the new blocks that will come in the midtime, which is impossible, because no one can have so much computational power, and even is he has, we is better for him just to follow the rules and earn a ton of money.
  3. More miners, more difficulty.
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#4382
  1. It incentivises them to play by the rules. If they donā€™t, they donā€™t get the rewards but still have to pay for the electricity.
  2. If someone changed a past block, the hash of the block (and the future blocks) would change, therefore that person would have to find the nonce of all the blocks in the chain. With time, miners would progress to mine further blocks and that would make the catch-up impossible.
  3. If there are more miners, the difficulty increases by lowering the target. Which in turn gives you less chance to guess nonce.
2 Likes
#4384

Heyy are you the poster of the post I replied, and then bow did you create this messagešŸ˜‚

#4385

  1. To incentivize honesty

  2. They would then need to mine all the blocks in front of the previous block, and catch up to the main blockchain.

  3. It does so with a target number that block hash must be lower than. The target number will get lower to increase mining difficulty.

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#4386
  1. Why is it important to make sure that miners spend money (on electricity) while mining?

This is an incentive to operate honestly. As the miner has effectively paid upfront, it makes no sense to break the rules as they would not receive the block reward transaction fee.

  1. Why would it be very difficult for someone to go back change a previously added block?

As the cryptographic link between blocks would need to be broken and cracking this code is practically impossible. Additionally, they would need to go back and re-mine subsequent blocks.

  1. How does the network regulate mining difficulty?

Through increasing and decreasing the ā€˜Targetā€™ number. The lower the ā€˜Targetā€™ the higher the difficulty.

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#4387
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    This ensures that itā€™s more cost effective for miners to play by the rules.
  2. Why would it be very difficult for someone to go back change a previously added block?
    They would need 51% of the hash power of the network at least so that can change a previous block and then catch up with the new produced blocks and then have the longest chain. This would cost a lot of electricity ensuring miners play by the rules
  3. How does the network regulate mining difficulty?
    The more hash power in the network (more miners) means lower target, higher difficulty
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#4388

Answer 1 - To ensure security of the blockchain network with increased puzzle difficulty

Answer 2 - because then it will require change in all blocks by mining starting from that previous block as all previous block hash output will change

Answer 3 - Network lowers the target for hash so it is difficult to found/guess

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#4389
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    To incentivize them to spend money to profit in return by ensuring integrity of data and ensure that you can only add data into blockchain.
  2. Why would it be very difficult for someone to go back change a previously added block?
    Because all the links between blocks would be destroyed and you would have to remine it and it could take your thousand of years with a huge processing power to catch up.
  3. How does the network regulate mining difficulty?
    By solving a cryptographic puzzle which is just guessing a random number called nonce and then getting a final hash of the block and calculating if that final hash is lower than the target. Target is number that depends on the difficulty of Bitcoin network. If final hash is below the target, That block is appended into the blockchain and miner gets block rewards and transaction fees.
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#4390
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    By making miners investing in electricity you ensure that they have incentive to follow the rules, since trying to cheat the system only would result at a loss.
  2. Why would it be very difficult for someone to go back change a previously added block?
    Because you will have to solve all blocks following the changed block since the link to the following blocks are broken.
  3. How does the network regulate mining difficulty?
    More miners result in a low target which increase difficulty.
1 Like
#4391

Homework on Mining and Proof of Work - Questions

  1. Why is it important to make sure that miners spend money (on electricity) while mining?

Miners need to spend money so they now are forced to solve the puzzle and make a profit out of it. If not, they lose the money they spent; this is how miners are incentivized.

  1. Why would it be very difficult for someone to go back change a previously added block?

If the info of a previous block changes, the hash will change, meaning the next blockā€™s hash will also change, and creates a chain reaction in which all blocks forward break the links and have to be mined again.

  1. How does the network regulate mining difficulty?

Through decreasing the hashing target. If the hash is lower than the target then the block is accepted, but the lower the target the harder it is to get.

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#4392

  1. This incentivizes them to not lose money by screwing up, which in turn ensures that things are done correctly.

  2. Because they would then have to mine that and all subsequent blocks successfully, as well as catch up with all the other miners, who have kept adding blocks the whole time.

  3. It regulates it by setting the target number. The lower that number is, the higher the difficulty of randomly producing a number below it, through hashing.

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#4393

  1. to keep the incentives high. If they wouldnt spend money they wouldnt get punished for not beeing honest or cheating so the enticement would be a way higher and without consiquences. The security of the network would suffer from that.

  2. The hash of a new block is build up on three things.

  1. previous hash.
  2. previous block
  3. nounce
    if you change one detaile, the whole blockchain after that would colaps and you have to main everything new (which is impossible).
  1. The more minors there are as more difficulte it gets, if the target is low difficulty is high.
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#4394
  1. Why is it important to make sure that miners spend money (on electricity) while mining? -> this makes it expensive to try to alter the history to for example double spend funds
  2. Why would it be very difficult for someone to go back change a previously added block?
    -> They would have to remine all subsequent blocks while competing with others for the longest chain. It would require extreme computing power and would cost enormous sums
  3. How does the network regulate mining difficulty?
    -> Every 2016 blocks the algorithm checks how long it took, to mine the previous blocks and then will regulate difficulty to on average achieve a block time of 10 minutes
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#4395

1. Why is it important to make sure that miners spend money (on electricity) while mining?
To incentivise them to make there money back plus profit on top of what theyā€™ve spent by winning the block reward and fees in their block. This keeps the Bitcoin network honest.

2. Why would it be very difficult for someone to go back change a previously added block?
If someone were to change a previously added block, the block would need to be re-mined and this would change the hash of the block, of which is linked to the next block and would change the hash of the next block which would need to also be re-mined and so on. The further back you go it would become exponentially more difficult to catch up to become the longest chain. Even if you were to try and change the last block it would be extremely difficult to compete with the total hashpower of the network

3. How does the network regulate mining difficulty?
Mining difficulty is altered based on the amount of hashpower on the network.
The more hashpower on the network the more difficult it is to solve the cryptographic puzzle required.

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#4396
  1. Its important for miners to spend money on mining because it keeps the system in check. They make money off of proof of work. They need to spend electricity to create blocks, and they are rewarded for doing so.
  2. If someone went back and tried to change a previously added block, they would need to continually change all the blocks after the current one they changed. It would be be very difficult to catch back up, and hypothetically if they did, it would have been more profitable to have spent that time creating new blocks on the current blockchain instead.
  3. The network regulates mining difficulty by adjusting puzzle difficulty based on how many computers are mining. This difficulty is a target, the harder the difficulty, the smaller the target.
2 Likes
#4397

Hello everyone!

  1. It is important to make sure that miners spend money (on electricity) while mining because they have to put up money upfront in the effort to making that money back in BTC plus profit.
  2. It would be very difficult to go back and change a previously added block because it would then change its hash and therefore the previous hash in the next block and then that nonce would have to be re-mined and the nonce guessed again by the computer and all following blocks would have to be re-mined as well.
  3. The network regulates mining difficulty such that when more miners are on the network mining the target is lowered automatically and it is therefore more difficult and costly for them to mine.
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#4398

1. Why is it important to make sure that miners spend money (on electricity) while mining?
It creates the incentive to be honest and follow the rules; since they have to spend money during mining, they will want to follow the rules to get the Bitcoin reward and transaction fees to turn a profit.

2. Why would it be very difficult for someone to go back change a previously added block?
The blockchain uses hash functions for every block on the chain, where every previous block creates the new hash signature that is used for the next block, and so on. If you chance even 1 bit in a hash signature, the output completely changes; if you were to change 1 bit in a previous block, all subsequent blocks would then be invalid as the hash signatures would all change.

3. How does the network regulate mining difficulty?
The network mining difficulty is called the hashrate, which is the amount of miners on the network. The more miners there are, the mining block target (a nonce random number) will be lower, and the lower this target the more difficult it is for miners to guess the nonce when generating a new block.

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#4399

  1. When miner spend money for electricity, so if they donā€™t follow the rules they will not get rewarded but still bare the costs of electricity.

  2. Every block hash is based on the previous blockā€™s hash, any change to any block will result in different hash, which will make all blocks after it invalid, and to mine the next block in their newly created chain will be extremely difficult because they would need to guess the nonce (to solve the puzzle) all by themselves which is hard while the other miners that holds most hash power will be mining other blocks and only the longest chain will be chosen by the network.

  3. In order to mine a new block, the miners need to solve a puzzle.
    the puzzle is to find a block hash that will be lower than a so called ā€œtargetā€, by guessing a nonce (random number) that together with transaction fee and the hash of the previous block, a new hash is created, until the value is lower than the target value.
    the more miners on the network, the lower the target will be which make it more difficult because it reduce the number of possible solutions.

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