Homework on Mining and Proof of Work - Questions

Blockchain and Bitcoin 101
#4660

Homework on Mining and Proof of Work - Questions

  1. Why is it important to make sure that miners spend money (on electricity) while mining?
  • so they use a large amount of electricity and then they have an incentive to earn back their losses
  1. Why would it be very difficult for someone to go back change a previously added block?
  • if changes the hash of all following blocks and would cost millions or billions of dollars to reshash all of these to make the changes a part of the blockchain - so it more cost effective to just follow the rules.
  1. How does the network regulate mining difficulty?
  • when there are more miners it becomes more diifuclt (lower nonce) and when there are less active miners it becomes more easy to hash (higher nonce)
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#4661
  1. Making the miners spend money will set up the incentive
  2. Because every block is formed by the previous hash of the previous block if you changed anything in a previous block you would have to re-mine every block.
  3. By setting the target High/Low
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#4662
  1. Why is it important to make sure that miners spend money (on electricity) while mining? when we spend money miners have the incentives to follow the rules since they are invested in the mining process of the blockchain
  2. Why would it be very difficult for someone to go back change a previously added block? because if anything is changed in the previous blocks it would break the link to the blocks and therefor u would not be able well maybe u could but it would be extremly hard because just by changing a letter ur blocks break
  3. How does the network regulate mining difficulty? as there is more miners on the blockchain the difficulty to guess the nonce is increased by lowering the target
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#4663

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

  • Because miners must play by the rules. Be fair to those who pay for their own electricity and do not take advantage of other people by using their electricity for your own personal gains. They will also not receive any rewards for their next block plus they must still pay for the electricity they used up.

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

  • If a block is changed or altered, every block that are after that will also be changed. Therefore that miner would have to repeat the mining of every block that was affected.

3. How does the network regulate mining difficulty?

  • The more miners, the higher the difficulty.
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#4664

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

Because it incentivizes the miners to calculate electricity cost into the profits, if there is electricity being wasted and zero profits being generated, example would be someone trying to cheat the system so to speak then they will be at a loss rather then complying with the protocol.

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

Because new blocks are always being added, by the time someone trying to change the previous block there will be many other blocks in front of it for them to solve therefore always spending electricity and always behind never getting rewarded.

3.How does the network regulate mining difficulty?

It regulates mining by updating its difficulty to find blocks roughly every 10 minutes

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#4665

  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    Because they are basically spending money (on electricity) before they are able to make money on fees and block rewards. If they they try to do something wrong while mining (approving double spend, for instance), the blockchain will not accept his block, meaning he will not be compensated, meaning the money this miner lost on electricity will be in vain. So miners need to do things right in order to get their block rewards and transaction fees. This system only rewards the honest.

  2. Why would it be very difficult for someone to go back change a previously added block?
    Every block’s hash is based on the previous block’s hash, the transaction list and the nonce. If you change a transaction on the previous block, the hash of the current and following blocks would also change. So the miner would need to spend loads of energy and loads of time to do this. It’s basically impossible.

  3. How does the network regulate mining difficulty?
    With the target. The higher the number of miners, the lower the target number, and the lower this number is the harder it is to get a nonce that generates a hash below the target number (which is the goal of the miner when mining a block: getting the hash of the block to be lower than the target).

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#4666

  1. So that they play by the rules in the hopes of being compensated by the network. I creates more incentive.

  2. It is practically impossible to edit a block as it would then require all following blocks to be remined until the current block faster than what blocks are currently being mined at so that you create the longer chain, and the network accepts you version of the chain as truth.

  3. Through adjusting the target of the current block hash, based on the number of miners.

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#4667

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

The miners have “ skin in the game” and will strive for incentives . It keeps the network “ honest”

2. Why would it be very difficult for someone to go back change a previously added block?
All blocks are connected to the prior hash “ signature” for continuity of the blockchain , doing so would be very difficult and they would have to re-mine all blocks .

3. How does the network regulate mining difficulty?

A lower target creates a higher difficult. Finding the NONCE is a puzzle of guessing and the lower target make create a higher probability of missed targets .

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#4668
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    it boost honesty of work for miners spend computer power to solve the puzzles (and invest money on electricity) to earn the reward in bitcoin by being the first to guess the hash of a block that is connected to another block already hashed; this allow to secure the network.
  2. Why would it be very difficult for someone to go back change a previously added block?
because to change a block would cause a cascade effect of not matching ;
previous nonce and hash values in the chain. ;
The other nodes will reject the change because ;
the hash of that blockchain has been altered.
  1. How does the network regulate mining difficulty?
there is hash per block and that hash is from the data of the previous block; 
having more miners increases the difficult to guess the puzzle;
 by lowering the nonce target.
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#4669
  1. This is important to ensure that they play by the rules. If they cheat the system then their block will be rejected and they will lose the money they spent on electricity with no reward
  2. This would be extremely difficult because each new block that is added has a hash that is based on all previous blocks. If one byte is changed then the hash of that block will change and that will affect all future blocks.
  3. When the network has rate is higher then the difficulty becomes harder. This is regulated by the target number that the miner has to achieve. If more people are mining then the difficulty becomes hard by lowering the target number. The lower the target number the more difficult mining will be.
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#4670
  1. Why is it important to make sure miners spend money (on electricity) while mining?

It is important to make them spend money so there is incentive to earn money by mining and following the rules. If they do not follow the rules their work will be rejected and the will lose money on the electricity they used.

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

It would be almost impossible to change a block because a change would effect to the blocks that follow.

3.How does the network regulate mining difficulty?

The difficulty is regulated by the target number. When the target number is low the difficulty rate increases. Less numbers to choose from.

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#4671

  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    By spending money on electricity, miners are investing into the mining process. This helps add incentives for the miners to follow the consensus algo in order to be rewarded and not lose their original investment of money (electricity).

  2. Why would it be very difficult for someone to go back change a previously added block?
    Because blocks use the previous block’s hash for the hashing of new blocks, someone would have to go back in the chain and solve each cryptographic puzzle for each block from the changed block to the present. The larger the blockchain network is the more difficult this becomes because of the amount of computer power it would take to rehash all of the blocks and catch up to present time.

  3. How does the network regulate mining difficulty?
    Miners try to guess a random number known as a nonce when hashing a new block with the previous block’s hash and Tx list. The new hash number must be smaller than the nonce number to be accepted into the blockchain. The more miners there are on the network, the lower the nonce number becomes, thus, increasing the difficulty for miners to guess the nonce first.

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#4672
  1. Why is it important to make sure that miners spend money (on electricity) while mining?

It is important to make sure that miners spend money on electricity while mining because paying for this energy used in mining establishes “Proof of Work” or PoW as the Bitcoin network depends on miners running energy intensive computers round the clock to verify transactions and add them to the blockchain. Also, Bitcoin’s energy usage depends on the number of miners operating on its network at any point in time.

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

It will be very difficult for someone to do this because changing a previously added block will break all links and this can only be corrected by the non-feasible task of re-mining every block.

  1. How does the network regulate mining difficulty?

The network regulates mining difficulty by comparing the time it should take to find 2,016 blocks of transactions to the time it took to find the last 2,016 blocks. Accepted block time is 10 minutes. Bitcoin’s mining difficulty is updated every two weeks.

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#4673
  1. Miners don’t spend money to be dishonest.
  2. It’s very difficult for someone to go back change a previously added block because a change impacts all the blocks. We need to mine this block and the next following blocks.
  3. the more miners, the more the difficulty to guess the nonce increases.
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#4674
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    -> Miners spending money or ‘paying up front’ incentivizes miners to make money.
  2. Why would it be very difficult for someone to go back change a previously added block?
    -> they would have to re-mine every block after again.
  3. How does the network regulate mining difficulty?
    -> by lowering the target number
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#4675

  1. It is part of the PoW. Thats how they can prove they have played by the rules.

  2. If someone change block content then all next blocks will change too witch makes them invalid for network. In all the next blocks will need to guess nonce number to make hash valid. It is not worth from money perspective to play against the rules, miner will not get paid.

  3. Lower target. By adding more zeros in hash for the next block.

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#4676
  1. as proof of work, they spend money on electric to get the fees and rewards for mining and putting transactions on blockchain.
  2. they would have to change all other pervious nodes as well as keep up with new blocks being made
  3. more miners means lower target which is harder when random guessing
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#4677

  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    So that they are incentivized to make money, but also to lose it if they are dishonest or cheat.

  2. Why would it be very difficult for someone to go back change a previously added block?
    Because the PoW consensus algorithm applies cryptography, and if you go back and change or edit a block, it will affect all the blocks ahead, making it invalid, where the network would be alerted of the manipulation

  3. How does the network regulate mining difficulty?
    By creating a 10 minute window between every block, and as the hash rate increases it get more difficult to create blocks

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#4678

  1. Because it creates an incentive to not break the rules.

  2. Each block contains part of a previous block so they would have to change every block ever which would be impossible.

  3. more miners in the network, the lower the target is set, resulting in a higher difficulty

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#4679

  1. In order to guess the nonce.

  2. The process would require a huge amount of compute power in order to go faster than the actual network compute power.

  3. By hashrate

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