What is Mining Difficulty? Blockchain FAQs Answered

Mining difficulty is one of the most important aspects when it comes to cryptocurrency mining. Some cryptocurrencies are harder to mine than others. Bellow, we will explain what causes such difficulty.

What is mining difficulty?

Mining difficulty is a measure that calculates the difficulty of a mathematical equation. These equations are necessary for miners to obtain a hash.

Difficulty factors

There are several factors that affect mining difficulty:

  • For some cryptocurrencies, there is a global block difficulty that the system sets by default. Blocks need to have hash power that is lower than the target set by the system. 
  • Second, it is possible for a mining pool to use what is known as a “shared difficulty” setting for mining a specific cryptocurrency. Smaller share difficulty provides more accurate stats and payouts in the short-term and bigger share difficulty, while also showing accurate results, does so in the longer-term. 
  • Third, mining difficulty depends on how many people are actively mining on the cryptocurrency network at any given time. 

Bitcoin example

For example, the Bitcoin mining network has a global block difficulty. It’s mining difficulty automatically adjusts every 2,016 blocks on the bitcoin network. As the difficulty increases, miners will need better machines to accommodate the difficulty. 

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