Bitcoin Mining Tutorial Part 1 - Difficult Conditions

Part 1: Bitcoin Mining tutorial and Network Difficulty

This is a multi-part Bitcoin mining tutorial targeting people new to Bitcoin. I wrote this back in 2014, but the same principals apply. The difficulty now is much much higher(as of May 2017 network difficulty is an astounding  533 Billion). Mining conditions seemed severe at 40 Billion and this shows the potential growth of the digital currency.

Part 1: What is difficulty and how does it affect mining gear?

 Bitcoin mining tutorial

Network Difficulty is just a representation of how many shares it would take on average to find a Bitcoin block. Currently (Update as of May 2017 network diff is now 533 Billion), Network Difficulty is 40 Billion. Simply, that means you need to complete 40 Billion Difficulty 1 shares to find a block on average.

Think of it as scratching lottery tickets. If one out of every 1,000 tickets is a winner on average. The first ticket you scratch might be a winner, or the 2,000 ticket might be. This is referred to in Bitcoin as mining luck.

What is a Difficulty 1 share?

Referred to as Diff1, it was/is the baseline pool mining used to define work accepted.

  • 71.58 MH completes one Diff1 share on average every 60 seconds
  • What is 71.58 MH? = That was about a low end AMD Graphics card from 2012

How do I calculate what my miner will make instead of having to rely on a calculator?

Network Difficulty / Diff1 shares = minutes to complete a block.

Example 1:

  • Network Difficulty= 1 million
  • Your miner = original ASICMINER USB at 333 MH
  • (333/71.58) = 4.652 Diff1 shares per minute
  • (1,000,000/4.652)= 214,961 minutes or 149 days on average to find a block.

Example 2:

  • Network Difficulty = 13.46 Billion
  • Your miner = KNC Neptune at 3.3 TH
  • (3.3*1,000,000) / 71.58 = 46,100 Diff1 shares per minute
  • (13,460,000,000/46,100) = 291,973 minutes or 202.75 days on average to find a block

Diff1 is no longer actively used by pools because it is not practical to log 46,100 shares per minute for one miner. The reference to Diff1 is still used by everyone, just as multiples.

The pool you mine reports back that you submitted a Diff 1000 share. You did not send back all the shares less than Diff 1000, but when you submitted a Diff 1000 share, you get credit for 1000 shares.

So instead of submitting 46,100 shares per minute, you would be submitting (46,100/1000) = 46.1 shares per minute. You still get the same amount of credit, and your miner did the same amount of work as before. You are just filtering shares below Diff 1000

This is the end of Bitcoin mining tutorial Part 1, I hope it makes sense.

I wrote this so average new miner could read it, not so it could be an exact mathematical formula.


Part 2: Bitcoin Hash Target

What is a Bitcoin hash?


Current Bitcoin hash target, Hexadecimal

When you are mining Bitcoin you hear difficulty, MH, GH and TH referenced often. You see mining software best share found represented as a regular number like 1.5M.

I am going to skip all the information that really does not matter to the regular end user and get straight to the explanation. I will try and make it short and sweet, you might need a cup of coffee.

To solve/find/mine a Bitcoin block, the Hexadecimal number produced by your miner needs to be smaller/more difficult than the current Bitcoin Network hash target.


Hexadecimal short and easy version:

  • 0-9 are just 0-9
  • A=10, B=11, C=12,D=13,E=14,F=15

Example with regard to a Bitcoin hash target:
If these were shares found

  • 00000F
  • 00000A would be a better share because A=10 and F=15



  • Current hash target:  000000000000000051ABA2000000000000000000000000000000000000000000
  • Information you need from this: There are 16 zeroes before the 51ABA2
  • So, if you have a hash result with 13 zeroes and B   0000000000000B you did not solve a block
  • If you have a hash result with 16 zeroes and a A   0000000000000000A you did not solve a block
  • If you have a hash result with 16 zeroes and a 4   00000000000000004 you did solve a block

The next difficulty target will be harder/easier depending on the speed blocks were found. 2016 blocks between difficulty changes.

  • If mining has not grown, but stayed the same the 2016 blocks would take 20,160 minutes to complete.
  • If mining has grown and the 2016 blocks completed in 18,000 minutes- Difficulty will rise by approx 12%.


Again, I hope this makes sense to newcomers. This is meant to be a simplified idea of what happens and what earns you Bitcoin.


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