Bitcoin mining, charted
Mining Yachts
A quiet guide to how Bitcoin mining works. Walk the deck plan, cost a voyage, convert the energy.
Manifest
Mining, in plain water
Bitcoin has no central keeper of the ledger. Thousands of independent computers hold copies of the same record and agree on its next page by a rule anyone can check: a new block is accepted only when its header hashes to a number below a target. Finding such a header takes an enormous number of guesses, and that effort is what miners contribute to the network.
The effort is the point. Rewriting history would mean redoing the work, so the cost of the ledger’s honesty is paid up front, in electricity and hardware, rather than promised later by a trusted party. In return, the miner who finds a valid block collects the block subsidy and the transaction fees it contains.
This site draws that machinery as a vessel because ships make good diagrams: every part has a place and a purpose, and nothing is there for decoration. Every calculator runs in your browser on numbers you enter. None of them is a forecast.
Fixed by the protocol
Four constants of the protocol
- Supply cap
- 21,000,000BTC, ever
- Target interval
- ~10 minper block, on average
- Halving cycle
- 210,000blocks between halvings
- Proof of work
- SHA-256applied twice to the header
Difficulty retargets every 2,016 blocks. The whitepaper appeared in 2008 and the genesis block followed in January 2009.
The voyage of a block
Six stages, quay to settlement
From waiting transactions to a settled reward. Select a stage, or focus the list and use the arrow keys.
Stage 1 of 6
Transactions gather
Every full node keeps a waiting list of valid transactions it has heard about but has not yet seen in a block, usually called the mempool. Each transaction spends coins from the UTXO set, the ledger’s record of unspent outputs, and offers a fee to whoever includes it. Nothing is final yet. These are passengers on the quay.
Stage 2 of 6
A candidate block is drafted
A miner, or the pool coordinating many miners, selects transactions from that list and assembles a candidate block. The first transaction, the coinbase, creates the block subsidy and collects the fees. Because the miner chooses what to include, fees influence which passengers board first.
Stage 3 of 6
The header is hashed
The 80-byte block header, which commits to the transactions, the previous block and a timestamp, is passed through SHA-256 twice. Changing a small field called the nonce changes the result unpredictably. Mining hardware repeats this cycle trillions of times a second and inspects every result.
Stage 4 of 6
The target decides
A hash counts only if, read as a number, it falls below the current target. A lower target means fewer hashes qualify and more guesses are needed. Every 2,016 blocks the network recalculates difficulty so that blocks keep arriving about every ten minutes on average, whatever the total hashing power.
Stage 5 of 6
The network checks the work
A valid header is cheap to verify: it takes one more double hash. Nodes also re-check every transaction against the consensus rules and reject any block that breaks them. A miner cannot argue its way past this. The block satisfies the rules or it is discarded.
Stage 6 of 6
The reward settles
The coinbase pays the subsidy plus fees to the address the miner chose. The subsidy began at 50 BTC and halves every 210,000 blocks, which is how total supply approaches its 21 million cap. The voyage calculator takes 3.125 BTC as an editable starting value; change it whenever your scenario calls for it.
Itinerary
Choose your passage
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01
Deck plan
Four stations, one block. Step through the bridge, engine room, sun deck and hold of an annotated cross-section.
Walk the decks -
02
Voyage
Enter hashrate, power, electricity and price. Read expected output, running cost and net per day, with the arithmetic shown.
Cost a voyage -
03
Energy
Convert J/TH and W per TH/s, cost your kilowatt-hours, and see how much heat the hold has to carry away.
Convert the energy
Ship’s glossary
Ten terms worth knowing
Short definitions, exact where the numbers are exact.
- Hash
- A fixed-length fingerprint of some data. Change one bit of the input and the fingerprint changes beyond recognition.
- Nonce
- A number miners vary in the block header so that each attempt produces a different hash.
- Target
- The number a header’s hash must fall below to be a valid block. Lower target, harder search.
- Difficulty
- A convenient restatement of the target. Expected hashes per block are about difficulty × 2³².
- Hashrate
- Hashes computed per second. Machines are rated in terahashes per second (TH/s), where one terahash is 10¹² hashes.
- Subsidy
- New coins created by each block, halving every 210,000 blocks.
- Fees
- What transactions pay to be included. The miner of a block collects the subsidy plus the fees inside it.
- Mempool
- A node’s waiting list of valid transactions that are not yet in a block.
- UTXO
- An unspent transaction output. Bitcoin tracks spendable coins as a set of these rather than as account balances.
- Pool
- A service that combines many miners’ work and shares rewards in proportion to the effort each contributed.
Honest bearings
What this site will and will not do
No promises
Mining outcomes depend on price, difficulty, electricity, hardware and luck. This site predicts none of them, and nothing on it is financial advice.
Your numbers only
Every figure in the calculators is an input you control. Starting values are labelled illustrative and exist so the page has something to compute.
Independent
Mining Yachts is an independent educational project. It is not affiliated with any pool, manufacturer, exchange or Bitcoin project.
Ready to cast off?
Begin with the deck plan, or go straight to the numbers.