Homework on Mining and Proof of Work - Questions

Blockchain and Bitcoin 101
#526

  1. To incentivize playing by the rules to remain honest.

  2. Because it would eat up to much time and electricity. If something is changed in a block and previous block. So essentially all blocks would have to be changed.

  3. Mining difficulty more miners higher difficulty. Less miners less difficulty.

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#527

  1. Why is it important to make sure that miners spend money (on electricity) while mining?
    This makes it where the miners have incentives to produce correct blocks and not malicious blocks. This makes the miner invested in the mining process.

  2. Why would it be very difficult for someone to go back change a previously added block?
    The chain would be broken and with hash puzzles being based off previous hash it would not get added to the blockchain. Also, the miner would have to spend a lot of money and each block they go back it will take exponentially longer to catch up.

  3. How does the network regulate mining difficulty?
    The more miners the higher the mining difficulty. The nonce is lowered making it harder for miners to guess this number.

#528

  1. It is important to the economy of the Network and to the Security of the network that the miners need to spend money so that they will do the correct thing and not try to cheat the system

  2. it would be difficult because you would need to re-mine all the previous blocks and have all the other nodes agree to your changes Why they say 51% of the network would need to be controlled by you.

  3. The network regulates mining difficulty by changing the nonce in accordance to the Hashpower available on the network, the new nonce will either be easier or harder to find based on that hashpower in order to keep the mining time to roughly 10 min instead of 20 or 30 min to find the Block

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#529
  1. To ensure honesty
  2. You’d need to control 51% of the network which is theoretically possibly but practically very difficult
  3. By increasing and decreasing the difficult to ensure every block is mined approximately every 10 minutes.
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#530
  1. By spending money for electricity the miners have to follow the rules, otherwise they will lose their investments for mining.
  2. Every change in previous block will lead to the change in the next block and will break the link between them.
  3. As the miners grow it is became more difficult the guess the nonce.
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#531

  1. It helps to maintain the integrity of the network by making it expensive for a miner to try to cheat the system. A miner will want to spend their hash power on solving a block rather than wasting the hash power on something that will be rejected by the network.

  2. Because they would then need to mine every subsequent block to catch up to the current block length. Which would be almost impossible to do.

  3. The mining difficulty is regulated by decreasing or increasing a target number that the resulting block hash must be less than.

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#532

  1. When miners spend electricity, and they try to make some malicious block/transaction their request is rejected by the network. Hence they lose money spent on electricity. Hence this will prevent a lot of miners from keep on trying to manipulate transactions.

  2. If you go back and change the transaction, the hash of the block will change. This will make the hash of following blocks redundant also the link will be broken with the subsequent blocks. Hence those blocks will again have to be mined. Even if someone is able to change a transaction, mining each block will take astronomical amounts of time and the miner will never be able to catch up with Pow (largest number of blocks) which others have been adding continuosly.

  3. If the miners in the network increase, the network will reduce the target hash for the new block which will make it difficult to get lower than target hash. Vice versa happens when the miners decrease.

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#533

  1. To further the incentive of the miners to be more competitive and less disincentive at the cost of wasted energy consumption.

  2. It would change the hash of all the blocks after it on the chain requiring them to remind those blocks as well as catch up to blocks already mined by the other miners as well, which is more expensive than it can ever help to gather the computing power.

  3. The network is regulated by an inverted Hashing power to Mining difficulty’s target being on the lower side of the difficulty scale.

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#534
  1. So that there is proof of (their) work.
  2. You will need to re-mine all previous blocks plus keep up with the newly mined ones.
  3. More miners means difficulty gets higher, less miners means the difficulty gets lower, therefore each block takes approximately 10 min to mine.
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#535
  1. So they have an incentive and play by the rules.
  2. If one block is changed it changes all previous blocks as well and to go back and change them all would result in losing money and time.
  3. By how the target is set. The lower the target the higher the difficulty.
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#536
  1. They have to spend money to make money
  2. in this case they would have to go back to hanged block, regenerate new hash and then mine all skipped blocks again while doing it faster than the rest of the network.
  3. By changing the value of the target - the higher the difficulty the smaller the target.
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#537

  1. It is important to make sure that miners spend money/energy to provide incentive for being true in their mining. If the miners were to provide false data they would waste their money/time because the network will not accept their block.

  2. It would be difficult for someone to change a previous block because the hash of that block and all sequential block hashes would change.

  3. The network regulates mining difficulty by observing how many miners are mining on the network and adjusting the target as necessary.

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#538
  1. Because they need to have POW (proof of work)
  2. If you change something in a previous block, the hashes will change in all following blocks, and in order to fix it, they would need to re-mine the block that was changed along with every block that followed it to date.
  3. It changes the hashrate as more or less miners get added to the network to guess the nonce so the blocks get mined at the same timing of roughly 10 mins.
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#539

1-Why is it important to make sure that miners spend money (on electricity) while mining?
It is a incentive to play it fair

2-Why would it be very difficult for someone to go back change a previously added block?
Because one need to change the hash of other previous blocks.

3- How does the network regulate mining difficulty?
If the blocks are easily mined the difficult increases and vice versa.When the blocks are hard to mine the difficulty decreases

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#540
  1. Why is it important to make sure that miners spend money (on electricity) while mining?
  • Because then the incentament for miners to do correct work and dont cheat are bigger because of the cost they have. Like if you want to cheat the network, you need to controll 51% of the hashrate + the power of the network. If would be a hack with high entry barier of cost, for destroying the network.
  1. Why would it be very difficult for someone to go back change a previously added block?
  • Because if you change one block, then the entire blockchain would be wrong and wont work anymore.
  1. How does the network regulate mining difficulty?
  • Every 14 day the network adjust the difficulty up or down depending on the hashrate. The adjustment allways come close to 10 min pr. block.
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#541

  1. Miners having to spend money up front incentivises them to play by the rules. It would very soon become financially challenging to try trick the system only to have your blocks rejected by the network.

  2. Blocks are linked by hashes that are partly determined by data in the previous blocks. So changing anything in a previous block will break all the following links, thus invalidating the chain. In order to get away with such a change, one would have to re-mine all the following blocks. Plus try to keep up with the network that has been mining new blocks in the meantime.

  3. Mining difficulty depends on the available hash rate of the network. Should the hash rate dramatically decrease, the likely amount of time in which the next block is mined will statistically increase. Since the protocol strives to have new blocks added to the chain every ten minutes it will automatically adjust the difficulty by raising the target under which the resulting hash must fit.

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#542
  1. Because you need to keep the miners monetarily incentivized to follow the protocol.
  2. Because it would change the hash of the block, breaking the links to all other blocks ahead of it meaning you’ll have to single-handedly re-mine the block, all the broken blocks as well as the other new blocks that have been made during that time.
  3. It uses hash-power to judge the strength of the network and regularly regulate the mining difficulty accordingly.
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#543

*** Why is it important to make sure that miners spend money (on electricity) while mining?**
This is to make sure all players in the network are acting right, part of their incentive to get rewarded is to do work.

*** Why would it be very difficult for someone to go back change a previously added block?**
Changing a previously added block would then change all the blocks after it effectively breaking the chain.

*** How does the network regulate mining difficulty?**
If there are more miners on the network, the target difficulty for finding blocks increases. This is an proportional function so when there are less miners on the network the target difficultly decreases.

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#544
  1. Because this guarantee the immutability of the blockchain and that that producing new bitcoin has a cost in terms of physical energy
  2. Because if you change even the smallest thing in a previous block the hash of that block would result in a totally different hash and the block after that which contains that previous hash would totally change and so on and so forth. This means that if someone change something before, even if it was accepted by the majority of miners than they would need to re-mine all the block from the changed one so-forth. This would cost them an immense amount of computational power and a lot of money. They are strongly incentivized to keep money and play by the rules
  3. Miners by changing a random number called nonce have to guess hash(previous block hash+Tx + nonce) that is lower than a target. If miners’ hashing power increases than the target would lower making it less probable for miners to find a hash that is less than the target.
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#545
  • Why is it important to make sure that miners spend money (on electricity) while mining?

To incentivize them to follow the rules so they will be rewarded by obtaining a block reward. This protocol is POW or proof of work which secures the network.

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

Changing a block would change all the previous blocks and invalidate the links on the block chain. All previous blocks would then need to be remined and then all the blocks created after the changed block would have to be mined which would require an unfeasible amount of time and power.

  • How does the network regulate mining difficulty?

By adjusting the target. A lower target makes difficulty higher. A higher target makes difficulty lower.

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