What is litecoin difficulty and how is this concept related to mining? The latter is no longer something of a hobby. To make a profit the home equipment like a pair of graphics chips or a powerful process is ineffective. It does not provide anything but working out wear and tear as well as large bills for electricity. It's all because of the difficulty – a special value that determines the result of mining.
Table of content
- How difficulty influences on the mining process
- What kind of equipment is needed to get profit?
- Pools and cloud mining as solutions of the problem
- Definition of difficulty and reasons for its growth
Difficulty and the choice of equipment for mining
Bitcoin as the initial and the most successful coin serves an example for its forks. In fact, they all follow in the footsteps of their mighty ancestor – first any cryptocoin promises profit almost out of thin air, and when a large number of participants join the mining process it becomes inaccessible to ordinary users. On the other hand, the cryptocurrency would lose its value if everyone could get it. Mining is not a computer game, but a complex mathematical process. To understand its nuances and principles you need to be a programmer and a mathematician in one.
Mining litecoin and any other cryptocurrency is a series of calculations, which is carried out by the certain equipment. These calculations are closely connected with the LTC net. For mining you need not only to buy hardware, but also to install it and configure a special program called miner. Is it possible to get a decent income, if you generate cryptomoney only on your home or office computer? As it has been noted above, it is absolutely unprofitable because of the growing level of difficulty. Even several powerful graphics cards don’t give a good chance to earn any more. A farm collected from several powerful ASICs is currently relevant.
Why do ASICs allow miners to achieve good results? These devices are many times higher than processors and graphics chips. We are talking about a hashrate - a unit of computational power. Simply put, ASICs are capable to analyze much more information than graphics chips and processors. The most powerful devices provide hashrate at the level of 12-13, and the developers are going to release the item with 16 TH / s! In addition, the advantage of ASIC is a special design for mining, but on the other hand, when the device becomes obsolete, it can not be used for other purposes in contrast to graphic chips
Can a pool or cloud mining solve the difficulty problem?
How’s that? Is it really that only those miners who can support buying the expensive and powerful equipment are able to run mining? To crown it all one should find a special building and provide a farm with cheap energy! In fact the difficulty is not a problem if your facilities are still quite relevant, for example, you’ve got a few graphics chips. Not every miner can play a role as a huge data center. Most of the ordinary participants in the process use pools. The principle of the pool has been described many times in the blog. The one thing is obvious: when users join forces to assemble a block they can move mountains.
- Find a pool with suitable conditions (reward system, fees, etc.)
- Register at the service – it will take a couple of minutes
- Add the pool address and its port number to the program settings
Of course, you have to create a litecoin wallet so that the funds received during the shared mining will be transferred to its address.
Cloud mining allows you not to install equipment at all, not to spend money or time on it. Moreover, in most countries of the world, the cost of electricity is growing all the time. There is information that some businessmen buy old power plants and modernize them in order to make mining profitable. Are you ready for it? If not, the cloud service will help you make a profit. You need to sign a contract with a company that will provide you with the hashrate capacity. Of course, nobody is going to bring ASICs to your house. The equipment is often located in another country, and you get a stable income on your wallet, staying at home.
What is the lightcoin difficulty?
In this article, we do our best not to burden readers with formulas and calculations. But to understand the question there will be a little explanation. So, the difficulty of the Litecoin network is a unit of measurement, which demonstrates how difficult to find a hash that will satisfy a given condition is. Time goes by, the participants’ number increases, the difficulty grows, and with it the requirements for the computational equipment become stricter.
Someone could assume that as a result of technologies development it will be easier to generate cryptocurrency. But as it has been already said, the entire algorithmic system of litecoin is designed to create a block for 2.5 minutes. Going beyond this interval means violation the principle of the whole system, therefore, difficulty increases along with performance. In the history of litecoin there was the episode when the fire in Taiwan destroyed a large farm and the productivity fell significantly. But it didn't last long.
Why the difficulty grows constantly
The rule of 2016 blocks
The algorithm of recalculation of difficulty is enabled after the generation of 2016 blocks. The system analyzes the mining speed for the purpose of uniform emission of cryptocurrency. The rules are that if 2016 blocks are found in less than 84 hours, the difficulty increases automatically or declines when the gap is more than 84 hours. On the website of the litecoinpool you can see the current difficulty and other important information as for the process of mining. It will help you make calculations and predict the profit.
Different number of shares
Why does the same number of correct solutions each time result in less reward at the same LTC rate? The problem is that about 3 million shares are needed to find one block. But as the litecoin difficulty grows, 5 million solutions are enough. When the index falls, it is enough to have only 1 million. That is why pools remain a unique opportunity for miners with small production capacities to make a profit. They provide a constant maintaining profitability by increasing the chances to find the block.