The word “hash rate” is often heard when trading virtual currencies. If you want to trade Bitcoin (BTC), this is a word you should definitely remember, but many people do not know what it means.
Therefore, this time, I will explain the basic knowledge of the hash rate, such as how the hash rate fluctuates, the relationship with the price, and the transition of the hash rate of Bitcoin.
Basic knowledge of Bitcoin (BTC) hash rate
Hash rate is also called mining speed, and represents the computational power and mining speed when mining virtual currencies such as Bitcoin.
It is expressed in units of “hash/s” and indicates how many times a second is calculated. Therefore, a high hash rate means that the processing power is strong, and a low hash rate means that the processing power is weak.
The higher the hash rate, the more efficient mining is possible. What does the change in hash rate mean, and how does it relate to price changes? First, let’s look at the basic knowledge of hash rate.
What is Bitcoin (BTC)?
Before we understand how hash rates work, let’s review the basics of Bitcoin and virtual currency, which are the representatives of virtual currency. If you want to know how to trade with the bitcoin then get maximum info here about crypto asset management
Virtual currency such as Bitcoin is not a kind of banknote or coin that we recognize as “money” in the first place, but a currency that makes payment by electronic means. It’s like the money that exists on the net, there is no real thing.
One of the wonderful features of Bitcoin is that it works without administrator. For fiat currencies such as Japanese yen and US dollars, there is a central bank that manages currencies, but Bitcoin uses blockchain technology and does not have an administrator.
Virtual currencies such as Bitcoin are managed by a computer network. As a result, it has the advantage of being able to trade between individuals and also prevents the state or central bank from deliberately controlling prices.
Since they are monitoring each other under blockchain technology, sufficient security is ensured. It is distributed and stored on the computer network, and has a mechanism to be visualized as a record.
Also, as a feature other than the absence of the administrator, what is worth mentioning is that it is excellent as a payment method and a remittance method. Since the fee is extremely low and the remittance speed is fast, it is suitable for payment at the time of shopping and remittance to overseas.
Many people invest in virtual currency in the hope that it will become an integral part of our lives, and they keep prices rising and the value of virtual currency itself.
On the other hand, in Bitcoin, there is no specific server that carries out the work of replacing books. In addition, as long as the balance of Bitcoin is managed by independent wallet software, it can be moved only by the owner, and you can send Bitcoin only by electronically signing it yourself. And the networks of miners (miners) who authenticate the transaction also communicate with each other by P2P.
What is mining?
Mining cannot be separated from many virtual currencies including Bitcoin.
Mining is the work of issuing a new virtual currency by analyzing information and creating a blockchain. It can be said that this work will generate a new amount of currency.
Accurately recording new trading information for virtual currencies and maintaining overall integrity requires a huge amount of computational effort. When recording new information, it is necessary to verify both the old data and the newly added data, which is a huge amount of work.
In order to match this amount of work, in the case of Bitcoin, we are recruiting people to do the recording work and paying Bitcoin to those who succeeded in the recording process. By setting the reward, participants will process faster even if they are ranked first, thus maintaining the integrity of Bitcoin.
Entry is not easy because mining machines with excellent computing power are required for mining, but many companies are participating in mining for rewards.