Bitcoin Mining Hardware Jargon

1years ago (2017-02-11) admin BTC Mining 458℃

Hashrate: the measure of how many attempts at solving a Bitcoin block a miner attempts per second. Obviously, the more attempts the greater the chance of solving the block and claiming the 12.5 BTC reward.

This figure was originally stated as H/s (hash per second). As Bitcoin mining hardware got faster and faster, SI unitprefixes were required:

  • Kilohash or KH/s = thousands of H/s
  • Megahash or MH/s = millions “
  • Gigahash or GH/s = billions “
  • Terahash or TH/s = trillions “
  • Petahash or PH/s = quadrillions “

TH/s is often used to state the hashrate of current generation mining hardware. PH/s is commonly used for the combined hashrate of a major mining facility or pool, as well as the total hashrate of the entire Bitcoin network (currently at a staggering 1665 PH/s).

Joule per Gigahash:  A Joule is a measure of energy, representing 1 watt over 1 second. The fewer Joules used to produce a Gigahash, the higher an ASIC miner’s electrical efficiency. As electricity is the major recurring expense of miners, this stat (often abbreviated as J/GH) is of prime importance when comparing miners.

Difficulty: with hashrate ramping up since Bitcoin’s release, one could be forgiven for expecting that blocks would be solved increasingly quickly. Difficulty is an automatic control measure which prevents that from occurring. Every two weeks, difficulty adjusts to the current hashrate so that blocks continue to be solved every 10 minutes (on average).

Profitability: this bottom-line number is calculated from the current Bitcoin price and Difficulty, your miner’s cost and hashrate and your electrical cost in fiat money per kWh. This ever-adjusting Difficulty mechanism, combined with Bitcoin’s volatile price, make calculating the future profitability of Bitcoin mining very tricky!

99Bitcoins’ mining profitability calculator is good for this purpose but if you’re serious about getting into mining, it’s recommended that you create a custom spreadsheet with inputs reflective of various exchange rate and Difficulty projections. Remember to account for probable downtime due to power cuts, hardware or software failures and the like.

Break-even point is the length of time it takes for your miner to pay for itself, if it ever does.

Pool Fees: given a total network hashrate in the thousands of Petahash, unless you control several PH/s your odds of successfully solo-mining a block are virtually nil. Mining pools are cooperative groups which combine their hash-power and distribute any rewards which the pool earns proportional to individual hashrates. Pools have different fees and reward structures which be compared here. The larger the pool, the more regular returns can be expected.


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