What is Hash Rate? 3 Things to Know (2020 Updated)

Genesis-Mining : Start Mining For As Low As 14 Cents Per Kilohash - Bitcoin 2014 Interview

Genesis-Mining : Start Mining For As Low As 14 Cents Per Kilohash - Bitcoin 2014 Interview submitted by jdebunt to CryptoCurrency [link] [comments]

A long term outlook at the Dogecoin economy and currency (intro & pt 1 - mining power and a 51% attack) [meta]

Dogecoin is awesome. Dogecoin is too the moon!
But like any moon mission, it's worth asking the question what can go wrong on the way there. What stakeholders exist in the Dogecoin economy, what outcomes are possible in Dogecoin's journey, and how those outcomes could affect the behavior of the stakeholders.
This post is designed to encourage you to ask questions about every aspect of how Dogecoin functions. I do not intend this as investment advice in any sense of the word and have worked hard to avoid any discussion about what will happen to the price of dogecoin in the future.
In this post I will outline the stakeholders, outline the factors that affect the currency, and address the question of how Hashrate is related to miners decisions, and how it protects Dogecoin from a 51% attack
A few of the key facts I'll discuss:
Disclosure: I own a small amount of Dogecoin and Bitcoin (less than $100 in total at current market value) It's purely for entertainment and research purposes.
At the moment, I see the following people in the Dogecoin community:
  1. Long term investors (individuals holding Dogecoin either as a store of value or an investment opportunity)
  2. Short term investors (individuals holding Dogecoin as an investment opportunity)
  3. Professional Dogecoin miners (individuals choosing to mine Dogecoin rather than other Scrypt based coins, motivated by income)
  4. Community Dogecoin miners (individuals choosing to mine Dogecoin because they like Dogecoin, not motivated by income)
  5. Dogecoin buyers and sellers (individuals using dogecoin as a short term medium of exchange)
  6. Dogecoin community members (individuals holding Dogecoin for fun and/or using it for non-monetary compensation {irrelevant of market value}
  7. Dogecoin developers (Individuals who will decide what changes are made to the Dogecoin protocol {some of which may affect market behavior})
It's important to note that individuals in the community can be in more than one category (someone who holds dogecoin for short term investment can also buy and sell dogecoin on the market)
Variables which can affect the above stakeholders:
A. The average (and future) mining reward from a block of Dogecoin per kilohash hour. (How much can I make mining Dogecoin, what will Dogecoin inflation look like)
B. The total mining power (in GH) focused on Dogecoin vs other Scrypt coins (the more distributed miners, the safer the blockchain)
C. The price of Dogecoin/Market Cap (to determine if Dogecoin is worth mining)
D. The market perception about the future price of Dogecoin (to determine if Dogecoin is worth holding/spending and worth mining) {this is harder to quantify}
E. The Transaction volume of Dogecoin (to determine the community interest in the currency)
F. The reliability of Fiat to Dogecoin exchanges and Crypto to Dogecoin Exchanges (to facilitate an efficient/accurate market price for Dogecoin)
G. The speed of Dogecoin conversion into fiat (for instant transactions by merchants)
H. The development pipeline for new Dogecoin compatible mining hardware (how far off are ASICs for Scrypt)
As I see it, there's one major outcome that affects the entire community equally.
A 51% attack on Dogecoin would be of massive adverse value to everyone (except the individuals perpetrating the attack). If Dogecoin's blockchain was corrupted, It would cease to function as a useful medium of exchange and as a store of value. Miners would leave because the value would plummet from it not being trusted. Short term investors would dump their holdings as they started to lose value. Long term investors would do the same.
The currency would die.
How does one prevent a 51% attack? Have a large total mining hashrate in the hands of a diverse number of miners. If the cost of running a 51% attack is so high it's not worth the money, it won't happen.
This leads to a fundamental question: what keeps people mining Dogecoin?
Dogecoin miners are separated into two groups (as mentioned above), Professional miners who will go where they can make the most money, and amateur miners who will mine Dogecoin because they like the currency.
From a community health perspective, the professional miners are the main concern (with a few caveats). If professional miners leave, that affects trust in Dogecoin.
So what keeps them mining for us? There are two major Scrypt based cryptos out right now, Litecoin and Dogecoin, and the community, as of this writing, is essentially split 50/50 is split 55/45 in favor of Dogecoin.
What this reflects is that miners expect to make more money mining Dogecoin than litecoin. Since an efficient market exists for trading Litecoin into Bitcoin and Dogecoin into Bitcoin, it seems to this author that value should be assessed in terms of current actual value (that miners choose what coin to mine based on how much they can sell it for today)
Since two large scale profitable currencies exist (LTE and DOGE) miners are going to choose the more profitable up until the point where the two converge. This depends on three variables:
Difficulty, total hash rate, and average reward.
As of Jan 23, DOGE is a little over twice as profitable as LTC.
This is what has prompted the major switch of the past few days.
I need help modeling is how much total value comes from LTC and how much from DOGE (essentially, if I owned the entire mining pool and split my work equally, how much could I make from each currency?)
At some point, enough miners will leave LTC that it's difficulty will drop. Assuming LTC retains its value (in fiat), falling difficulty will make it more profitable. Eventually, its profitability will once again match that of Dogecoin, and miners will stop leaving LTC for DOGE.
The problem is that as miners leave, it is possible that the currency value will drop as well.
On Jan 20, LTC had a 115GH rate, Doge had 57GH. Doge was trading at .00003 LTC. On Jan 23, Doge had 95, LTC had 75, and Doge more than doubled in price to .0000675. (Litecoin has also dropped about $1 (~5%) in value in USD over the same period.)
This is likely why even though Dogecoin has more miners than LTC, Litecoin is still less profitable for Miners (at this precise moment). Dogecoin has increased in currency value more than it has decreased in mining value.
Thus, the fundamental question is what kind of change is required in the price of DOGE/LTC and what hashing ratio will LTC and DOGE settle on based on their current price. It's important to remember that LTC has not dropped in value significantly, Doge has simply rose dramatically.
Fundamentally, as long as LTC has some value, it will have some percentage of Scrypt hashing power devoted to it. The same is true for Doge. So as long as people still want both currencies to some degree, mining power will be split. *Depending on that split, Dogecoin will be safe if it has enough mining power to prevent a malicious third party, and if that mining power remains in the hands of a diverse group of DOGE mining pools. *
My next post will address the different needs of the Long term investor, the short term investor, and the casual owner. (Some want a long term stable currency, some want a dramatic increase in price (even if it hurts the currency long term)
Please feel free to leave comments about anything you disagree with, any changes I should make, any thoughts about other factors that could affect the health of the currency, any other subjects you'd like to see explored. Thanks!
submitted by harddata to dogecoin [link] [comments]

[Shibe Market Analysis] An Introduction to Fundamentals-based Valuation

Browsing /dogecoin and the community at large, you may have noticed that typically people "value", or form an estimate of the prices they'd be willing to buy and sell dogecoin at, through a number of methods, most common of which are a buy and hold-style (which at its core is saying dogecoin will be undervalued til we reach the proverbial moon) and technical analysis based, akin to saying "dogecoin hasn't gone below 150 in a while, so buying at 150 is probably a good idea".
While both of these techniques have their merits, there is a 3rd methodology of valuation that may interest the more mathematically-oriented shibes, and is helpful for all shibes to be familiar with, namely fundamentals-based valuation.
What are fundamentals?
Fundamentals are the underlying characteristics of the doge economy; metrics like the average transaction value, network difficulty, block reward and rate of dogecoin production are all ways of "measuring" these characteristics and play a role in fundamentals-based valuation. It is worth noting that only fundamentals-based valuation can answer the question of "why", because it is the only methodology that incorporates the underlying economy beneath the price of doge. For example, if i ask why dogecoin doesn't go below 150, a trader may answer that whales have a buy wall at 150, or there is strong support at 150, but can never really explain why these phenomenon choose the price of 150 to assert themselves.
A Fundamentals-based Valuation
This spreadsheet shows the process of arriving at a target price for DOGE/BTC based on the underlying network difficulty and the cost of building a mining rig.
Modeling the rig
Mining rigs are a core component in the production of dogecoin, and while there are vast differences in their appearance and features, all mining rigs can be boiled down into two key metrics - the capital cost per kilohash per second, and the electrical consumption per kilohash per second. Capital cost per KH/s measures how much it costs to build the rig, and typically hovers around $1 per KH/s. Using quality parts and higher margins of safety pushes this value up, while skimping on quality and operating with smaller safety margins can push this value closer to $0.75 or lower. A lower value of capital cost per KH/s means your rig is more efficient with your capital (the money you use to build it). Electrical consumption per KH/s is much more standard, as the predominant AMD gpus essentially share the same chips, and so even though some cards generate higher KH/s, they also use more electricity. This number combined with the electrical cost per kWh in your region essentially determine your "operating cost", or the cost you pay to keep your rig running. I've used the typical electicity cost in my region, 15 cents per kWh.
As a side note, the primary feature of scrypt asics is not the fundamental revolution it was in bitcoins - scrypt asics simply offer much lower electrical consumption per KH/s in exchange for a much higher capital cost per KH/s. It remains to be seen whether the hardware manufacturing industry will reduce the cost of scrypt asics enough to make them competitive with GPUs on a capital cost per KH/s basis. If this happens, then they will indeed become the dominant form of mining hardware, otherwise there will always be room for GPU rigs.
Modeling the Macro Economy of Doge
The network difficulty parameter you've probably heard of before, and essentially controls how many doges you receive per KH/s over a period of time. Since the total number of doges given out per block must average out to a fixed rate, but the global hash rate changes, the network difficulty adjusts to distribute the doges proportionately.
Finally, the Daily Growth Rate is one of the most important parameters, and one of the hardest to estimate. Essentially it's the growth rate of the dogecoin economy, and different ways of estimating it will dramatically change the result. Historically over the last 2 months, the doge economy has grown at an average pace of 5.04% per day, measured by market cap.
Putting it together
Using the network difficulty, its possible to estimate the daily doge production per KH/s, which using a network difficulty of 1418 works out to be approximately 7.09 doges/day. The electricity used to produce this is a flat $0.000000625 worth of kWh per day. The capital cost, on the other hand, varies according to the interest rate you use. Since we're assuming 1 KH/s costs $1 of capital, the required interest you need to earn on your capital is the effective daily cost of capital. Summing the two costs gives you an estimated total cost per day in USD of producing the 7.09 doge, and from this we can derive an implied exchange rate.
As you can see, the primary driver of changes in this exchange rate is the interest/growth rate on capital - much like how in fiat markets, the interest rate on government bonds determines exchange rates (if I can earn 2.5% on bonds in India but can borrow at 0.25% in the USA, I will borrow USD to exchange into Indian rupees to buy their bonds and earn a 2.25% spread, and in doing so create demand for rupees and supply of dollars in exchange markets, pushing the value of the rupee up).
In the case of doge, you can think of it as you can borrow on your credit card for 35% annually, or approximately 0.082% daily, and then use the money you get to buy a rig, which earns you 1.65% per day, and pocket the difference of 1.56% (please do not max out your credit card doing this). Should the value of doge fall below the level corresponding to 0.082%, new miners no longer will want to take debt to build mining rigs. I haven't done the calculations here, but you can actually use litecoin in a similar manner - litecoin is a safer, more established crypto than doge with less price variation, and so at the same rate of return on capital, a miner will probably choose to mine litecoin. Implicitly this also means that mining doge must earn a higher return than mining litecoin, and so the rate of return on capital mining litecoin sets a floor for the rate of return of mining doge, and thus the price of doge. Should the price of doge hit this floor, rather than the price continuing to fall the global hash rate and difficulty would begin going down instead, and those miners continuing to mine doge would receive the required return on capital because they collect more doges per KH/s.
Takeaways
Examining the selected interest rates, you can see that at the historical average growth rate of 5.04%, doge should be worth 1024 satoshis, more than 5 times the current price. It's clear the market doesn't believe we will continue growing at 5.04% per day. Working backwards from the current exchange rate, we can actually see that the market currently estimates the doge economy to grow at .86% per day going forward. When the block reward halves, if the network difficulty doesn't fall substantially, dogecoin will need to become substantially more valuable in order to justify the capital used to mine it. In practice, it will probably be a combination of the network difficulty decreasing and the price of dogecoin increasing that re-equilibriates the market, but this process may go on for a few weeks during which time the price of dogecoin and the network difficulty may be highly volatile. Notably, the hash rate that leaves dogecoin will probably migrate to other cryptos, and so it may be worthwhile for daytraders and speculators to begin looking for those alt-coins likely to attract the displaced hashrate from dogecoin once the block reward halves, and buy those coins before their network difficulty rises in anticipation of the prices rising.
While this article isn't meant to be a definitive guide on fundamentals-based valuation, it is meant to introduce the concept and light the path for shibes more interested in investing for the long run and display some of the techniques and the frame of mind behind valuations based on the underlying economy, rather than the lines on a chart.
Happy trading shibes!
Disclaimer: I am not psychic and do not actually know where the market is going; I'm pretty sure the market doesn't know where its going either (except TO THE MOON!). Please do not base your trading decisions solely on the above analysis, and never trade more than you're comfortable losing. Finally, please do not hate/sue me if trades don't go your way, but if they do go your way, it was totally because you read this article :)
If you're looking to learn how to trade or just want a quick refresher, check out my ongoing series, or if you just want to subscribe to these market analyses check out DogeTrader.
submitted by kwickymartkidd to dogecoin [link] [comments]

Mining Newbie here, is it possible to mine in Gigahashs?

Hey, me and some friends are trying to get into litecoin mining, originally we were going to mine Bitcoin, but I was running the numbers and this online calculator and it says we'd make 1,000's of dollars a day on a 38 gigahash miner for 128 dollars.
My friend brought up that all of the litecoin miners we saw on the internet were labelled in kilohash instead, would this mean we wouldn't be able to use this miner to mine in litecoin, and we should stick with bitcoin?
submitted by Raxal to litecoinmining [link] [comments]

Headie One - 18HUNNA (ft. Dave) Hallucinogen Honey Hunters - Hunting Mad Honey - Full Documentary Counterfeiting Microsoft Windows Restore CDs Landed Me in Prison for a Year Scrypt Mining Coins 5 Settings For Mining Cryptocurrency On Windows 10

Bitcoin Hashrate All Time High Bitcoin Hashrate on May 11, 2020 at block 629,899 159.39 EH/s How to Calculate Bitcoin Hashrate. The Bitcoin hashrate is calculated using the current Bitcoin difficulty, the defined Bitcoin block time, and the average block time of the last (X) number of blocks.. Most full Bitcoin nodes will have an option to see the current Bitcoin global hashrate using the Underneath the hood, Bitcoin mining is a bit like playing the lottery. Roughly every 10 minutes the Bitcoin code creates a ‘target’ number that the mining machines try to guess. Typically we call this finding the next block. Like many things connected to Bitcoin this is an analogy to help things be a little bit easier to understand. Hash per second is an SI derived unit representing the number of double SHA-256 computations performed in one second, referred to as hash rate.It is usually symbolized as h/s (with an appropriate SI prefix).. Use in hardware specifications. The hash rate is the primary measure of a Bitcoin miner's performance. In 2014, a miner's performance was generally measured in Ghash/s, or billions of Mining capability is measured in the number of attempts to find a block a miner can perform. Each attempt consists of creating a unique block candidate, and creating a digest of the block candidate by means of the SHA-256d, a cryptographic hashing function.Or, in short, a hash.Since this is a continuous effort, we speak of hashes per second or [H/s]. Although Bitcoin’s exact hashing power is unknown, it is possible to estimate it from the number of blocks being mined and the current block difficulty. Notes Daily numbers (raw values) may periodically rise or drop as a result of the randomness of block discovery : even with a hashing power constant, the number of blocks mined can vary in day.

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Headie One - 18HUNNA (ft. Dave)

Headie One - 18HUNNA (ft. Dave) Headie One’s new mixtape ‘Music x Road’ Out Now 💥 Stream or Download it here: http://smarturl.it/HEADIEONEMUSICXROAD Stream o... A tribe of Nepal hunt a wild honey with natural psychoactive properties ("mad honey"), they use it as a medicine and a soft drug. Dipak, my translator is overdosing and falls unconscious. FOLLOW ... In 2012, while living in China, longtime e-waste recycler Eric Lundgren manufactured 28,000 PC restore discs to be used in refurbished computers sold in the United States. The shipment of discs ... Some of my scrypt mining rigs. Both rigs are running around 1800 kilo hash. I have four MSI R9 270s that hash at 455 kilo hash each. I also have four XFX R9 270s that each run at 450 kilo hash ... Music video by Limp Bizkit performing Break Stuff. (C) 2000 Interscope Records.

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