Validating Blocks
Now, we'll switch gears a bit from mining to the larger process of consensus. Here, we'll cover validating new blocks, the validation process, and blockchain difficulties such as forks.
Mining and the Hashing Race
Bitcoin mining is an extremely competitive industry. The hashing power has increased exponentially every year of bitcoin's existence. Some years the growth has reflected a complete change of technology, such as in 2010 and 2011 when many miners switched from using CPU mining to GPU mining and field programmable gate array (FPGA) mining. In 2013 the introduction of ASIC mining lead to another giant leap in mining power, by placing the SHA256 function directly on silicon chips specialized for the purpose of mining. The first such chips could deliver more mining power in a single box than the entire bitcoin network in 2010.
The following list shows the total hashing power of the bitcoin network in terahashes/sec (TH/sec), since its inception in 2009 (source: Blockchain.com):
2009
0.000004 – 0.00001 TH/sec (2.40× growth)
2010
0.00001 – 0.14 TH/sec (14,247× growth)
2011
0.14 – 9.49 TH/sec (63.92× growth)
2012
9.49 – 22 TH/sec (2.32× growth)
2013
22.04 – 15,942 TH/sec (723.32× growth)
2014
15,942 – 306,333 TH/sec (19.21× growth)
2015
306,333 – 881,232 TH/sec (2.87× growth)
2016
881,232 – 2,807,540 TH/sec (3.18× growth)
2017
2,807,540 – 18,206,558 TH/sec (6.48× growth)
2018
18,206,558 – 41,801,528 TH/sec (2.29× growth)
2019
41,801,528 – 109,757,127 TH/sec (2.62× growth)
2020
109,757,127 – 149,064,869 TH/sec (1.35× growth)
In the chart in Total hashing power, terahashes per second (TH/sec) (chart on a linear scale), we can see that bitcoin network's hashing power increased over the past two years. As you can see, the competition between miners and the growth of bitcoin has resulted in an exponential increase in the hashing power (total hashes per second across the network).
Figure 7. Total hashing power, terahashes per second (TH/sec) (chart on a linear scale)
As the amount of hashing power applied to mining bitcoin has exploded, the difficulty has risen to match it. The difficulty metric in the chart shown in Bitcoin's mining difficulty metric (chart on a logarithmic scale) is measured as a ratio of current difficulty over minimum difficulty (the difficulty of the first block).
Figure 8. Bitcoin's mining difficulty metric (chart on a logarithmic scale)
In the last two years, the ASIC mining chips have become increasingly denser, approaching the cutting edge of silicon fabrication with a feature size (resolution) of 7 nanometers (nm). Currently, ASIC manufacturers are aiming to overtake general-purpose CPU chip manufacturers, designing chips with a feature size of 5 nm, because the profitability of mining is driving this industry even faster than general computing. There are no more giant leaps left in bitcoin mining, because the industry has reached the forefront of Moore's Law, which stipulates that computing density will double approximately every 18 months. Still, the mining power of the network continues to advance at an exponential pace as the race for higher density chips is matched with a race for higher density data centers where thousands of these chips can be deployed. It's no longer about how much mining can be done with one chip, but how many chips can be squeezed into a building, while still dissipating the heat and providing adequate power.