Bitcoin Mining: a little bit about how it began

Bitcoin Mining is the process of cryptographic calculations. Bitcoins extracted blocks with an increase in this total number of coins generated block size decreases. Initially the unit was 50 Bitcoins, but the number of coins produced is halved every 210,000 units. Thus, the fee for each detected block falls with a certain periodicity twice.
This phenomenon is also known as halving. From an economic point of view, such a model of the system is necessary in order to control currency inflation.
Sam coins production process requires computing power, time and energy. And the longer the mining Bitcoins, the more resource intensive becomes their prey.
The rate of increase in total produced Bitcoin is an inversely proportional relationship, and decreases exponentially. The total number of coins thus tends to 21,000,000 and never exceeds this number.
 

If  the value found Bitcoin exceed the costs of their production, including  energy costs and computer equipment, such activity makes economic  sense. This  shows that with the increasing complexity of production Bitcoins less  productive and energy-efficient devices are leaving the industry.
At  the time of publication of the article complexity of computing has  grown by almost 210 billion times the total computing power of miners is  more than 1.5 billion GH / s (gigaheshey per second).
 

GETTING STARTED - CPU MINING
In  the early stages of mining development (since 2009) to compute the hash  of the new block header used by the central processing unit (CPU, from  the English. Central processing unit) of a computer. By comparison, Intel Core i7 990x processor showed a performance of about 33 MH / s (megaheshey per second). (Fig. 2)
 

GPU and the first farm for mining
Further progress of mining industry has shifted toward GPUs (from the English. Graphics processing unit, GPU). Because of the architecture of graphics adapters perform cryptographic calculations much faster than CPUs. GPU high-end options from AMD delivers the performance of the order of 650-675 MH / s. It was also possible to increase the computing power by combining multiple graphics cards. The  platform, otherwise known as a mini-farm, consisting of a motherboard,  CPU and RAM block could contain 5-6 powerful graphics accelerators. (Fig. 3)
 

MATRIX TIME
Problem areas of this approach turned out to be high power consumption of such systems. There competing FPGA-miners technology (from the English. Field-Programmable Gate Array -Programmable gate array). They provide almost five times greater gain in electricity consumption than GPU-miners. Hi-End solutions from Butterfly Labs (BFL), which is based on FPGA Altera, provided performance 25.2 GH / s.
Problem was the high cost of mining with respect to FPGA-GPU-of mining technology. In addition, video cards, after exhausting its capacity as a miner can be resold at a better price. (Fig. 4)
 

PARISH ASIC and an arms race
 

All  these devices were behind economic feasibility Bitcoin Mining after the  appearance of miners based on ASIC (from the English.  Application-Specific Integrated Circuit -integral scheme for special  purposes). They perform a single task - the cryptographic computation for mining. In addition, they have a higher energy efficiency and performance.
The  pioneer in this direction was the company Butterfly Labs, which started  taking pre-orders for miners on this technology, the most powerful of  which SC Mini Rig delivers performance in 1500 GH / s in June 2012.
The emergence of ASIC developers confronted the issue of alternative cryptocurrency defend their projects. Thus, we began to appear alternative, ASIC-stable algorithms. For example, X11, Groestl or Proof Of Stake. The  latter does not require the use of large computing power to protect the  network and the distribution of coins and the consensus achieved in a  fundamentally different way. (Fig. 5)
Currently,  due to the increasing complexity and resource of mining this type of  activity has migrated from small farms in data centers, which provide a  great level of computing power. In such conditions it becomes economically feasible to conduct bitcoin mining.
 

MINING IN CLOUDS
Studying the history and the present of mining Bitcoins, not to mention about this method of production as cloud Mining. We are talking about the use of cloud services for special cryptocurrency production. Of  the advantages of this approach can be identified no need to purchase  expensive equipment, energy costs and their miners, personal time  management. You just make a service charge and commission, which sets the company providing the service cloud of mining. It is true that this kind of mining there are risks associated with the possibility of not paying your profits.
 

HACKER MINING
Another popular method in specialized circles cryptocurrency mining - mining on other people's devices. To do this, the attacker enough to have your botnet and special software, which is invisible to the user Mein cryptocurrency. In  some cases it is sufficient to have only the software by paying  services "Gulf" malware on users' computers in an already existing  botnet. As a rule, the service is not too expensive.
Thus the attacker receives a very small capacity of each individual user, but in total it can be a good farm. So,  in 2014, an unknown hacker took advantage of a vulnerability in  Synology's servers and was able to earn more than $ 200,000 in  cryptocurrency Dogecoin. There are cases when the same Dogecoin Mein several millions of mobile devices. The reason was the same - a vulnerability that could not in time to find and eliminate the manufacturer. So be careful, you may be a part of someone else's farm.