Presently, total value being moved in the Bitcoin network is increasing on a yearly basis, as is the number of processed transactions. Ethereum processes about 15 tps and Ripple is the fastest, with a capacity to process about 1,500 tps. As each transaction has to be at least 250 bytes - a figure that is hard-coded into the Bitcoin protocol - the Bitcoin network can process up to 7 transactions per second (tps) if the block time is ten minutes. The difficulty adjustment takes place roughly every 2016 blocks (about every two weeks). If it takes longer to mine a block in the Bitcoin network, the “ difficulty” level will be reduced, if it takes less time, the difficulty is increased. It is the estimated length of time it takes to mine a block. A block is only accepted into the blockchain if all transactions in this block are valid and have not already been spent.Īs Satoshi Nakamoto estimates in his whitepaper on Bitcoin, blocks are generated just about every ten minutes - this is known as the “block time” of the Bitcoin network. The objective is to be the first miner to validate the new block.
The nodes then compete to be the first node to solve a complex cryptographic puzzle.
The computers of miners collect transactions that have been dispatched into blocks. As you have learned in lesson 8 of the Beginners’ section of the Academy, transactions in the Bitcoin network are verified in a process called mining.