Difficulty: 434,877, Total network hashing: 3,113 Ghash/sec
The recent difficulty threshold for generating bitcoins went from 244,139 to 434,877, representing a 78% increase in just under 8 days. The difficulty readjusts every 2,016 blocks and today this happened when block 127,008 was reached.
The hashing strength of the entire Bitcoin network is now at least 3,113 Ghash/second using the new difficulty measurement. Early calculations for the next adjustment indicate a continuing growth however with nearly two weeks left before that happens there’s little certainty as to what level will be reached.
It is quite possible though that difficulty will increase another 25% or more, considering the current high levels in the BTC/USD market rate.
Supplies of certain models of GPU hardware desired by miners, such as the ATI Radeon HD 58XX and 59XX have sold out globally now that the manufacturer no longer produces them. At the same time, supplies for the latest high-end graphics card, the AMD Radeon HD 6990 remain very tight.
Miners not using the high-end hardware, most of whom who already are in pools, are finding that their existing mining capacity yields less and less with each jump in difficulty. The mining profitability level is high enough yet that few except for those running the most inefficient hardware will continue mining.
New capacity is coming not just from individuals entering mining and adding a second or third rig, but from those doing so commercially. Additionally, emerging recently are options for using FPGA boards for mining.
Another wildcard is the introduction of browser-based webCL miners which require no miner software to be installed. The first two offered are closed-source and both require the Firefox 4 browser so deployment has not yet occurred widely but this development could bring participants to mining who are large in number and previously would not have even been considered to potentially be miners.
Though GPU mining still is the low-cost leader versus FPGA and/or ASIC options the new technologies will likely be competing for the very same bitcoins generated in just a matter of months. Mining difficulty lags price and still has some distance to go yet before it catches up to the level that would correspond with the market price rally.
A higher total network hashing strength allows there to be greater trust that an attacker cannot control, exclude or modify the ordering of transactions processed as the result of mining activity.
But by some estimates, the Bitcoin network now has a level of computing power that will within weeks exceed the level of all the Top 500 Supercomputer projects combined. [Please stop reading any more until you go back and read that last sentence one more time. - Editor]
Some in the Bitcoin community believe that “too much computational power is being expended to protect too little value”. Whether or not any alternatives to Bitcon’s proof-of-work method would be successful however is a topic up for debate.
Whether or not there is already more than enough capacity is immaterial to a miner. The rising exchange rate enables miners to continue investing in additional capacity and still stay one step ahead the difficulty avalanche.
Written on 26 May 2011.