The Evolution of Bitcoin Mining [Bit-Post]

A small insight into the fascinating world of bitcoin mining throughout the years. From hobby, to million-dollar businesses.

A brief history on bitcoin mining

Bitcoin mining wasn’t always about large, powerful ASIC miners.

In the early days, finding the best bitcoin miner was never a problem. As, well, there were none. The mining process was done by yourself, with no pools, using your computer’s CPU. However, with bitcoin mining starting to spark some interest, the difficulty hit an uptrend, causing mining by yourself to be pretty much pointless. Users would go days, even weeks without earning any bitcoins due to the luck of finding the next block.

Mining became a gamble.

With those unfortunate events taking place, early bitcoin fanatics were soon to develop something that’d change the future of bitcoin mining completely.

Bitcoin pools

Instead of one very lucky miner getting their hands on 50 bitcoins (before the bitcoin reward had its first halving), every miner pools together their hash rate in order to achieve the same goal, and distribute the block reward fairly throughout the workers, depending on the work put in.

Due to the bitcoin network seeing a surge in the hash rate, the difficulty was quick to increase, causing CPU mining to become near obsolete. The CPU mining era had ended, and the era of the GPU began.

AMD graphic cards were quick to take control of the mining market, their software architecture and price provided both hashing power and power efficiency over Nvidia cards. As you’d assume, the sheer increase of GPU farms caused the mining difficulty to continue to skyrocket.

Bitcoin mining hardware comparison sites showed which cards performed best, their price as well as expected income for ROI.

FPGA mining

FPGA mining is actually rather unheard of. Many seem to think the general mining ecosystem went from CPU, GPU then ASICs. Although that isn’t the case. FPGA mining certainly lead the way for bitcoin ASICs. Models were capable of hitting 400 MH/s at just 15 watts.

ASIC mining

In 2013 we saw the rise of bitcoin mining hardware. Chips designed specifically for mining bitcoin and other digital currencies. Hardware capable of hundreds and thousands of calculations per second. The best bitcoin mining hardware to date. Bitcoin mining hardware comparison sites became rather pointless. All you need now is a mining calculator and the estimated specs provided by the hardware seller.

I highly recommend watching this YouTube video that shows the impressive size of bitcoin ASIC farms in 2015.

In the video, it is reported that this farm costs $80,000 in power per month to run, and will produce 20 – 25 bitcoins per day.

For a more in-depth view of bitcoin mining in its early days, I recommend watchingThe Rise and Rise of Bitcoin — a documentary that shows the life of a bitcoin miner as the digital currency finally starts to get onto its own feet.

Source : http://bit-post.com/education/the-evolution-of-bitcoin-mining-4804