Mining

History of Bitcoin Mining Hardware

Mining is the essential prosses in Bitcoin to create new Bitcoins and record the transactions to the Bitcoin blockchain.

Bitcoin uses the Proof of Work (PoW) consensus mechanism for doing mining activity which requires the computation power of miner, means a miner hardware capability to do brute-forcing for finding a valid nonce value for the block.

From the inception of Bitcoin, Miners using different hardware components to speed up the process of finding a nonce by beating other miners who are on the same race but as Bitcoin becomes more and more popular mining race is becoming tuff, so a miner needs to upgrade their hardware to get ahead from other miners.

Just look at the data in below image that showcase increasing difficulty in Bitcoin mining.

bitcoin hashrate chart

Today miners are using high-end hardware like AISC to do Bitcoin mining, but in beginning days anyone can able to do the Bitcoin mining with the help of normal CPU unit!.

The process of finding the ASIC mining hardware not done in days it took miners to do a lot of tweaks and changes in different hardware units to achieve ASIC.

In this post, we’re looking at the evolution or history of Bitcoin mining hardware to know how ASIC arrived in the mining market.

CPU Units.

In the initial days of Bitcoin, the only way anyone mine the coin is using his or her own computer.

Back in 2009 when Bitcoin is still in the infancy stage the easy way to earn the Bitcoins is through the mining from CPU units because Bitcoin not famous as now and had a small number of miners do mining on the network.

After 2010 certain incidents like a computer programmer named Laszlo Hanyecz paid 10,000 BTC’s to get two large Papa John’s pizzas that worth $25 pushed to spread Bitcoin popularity and gained more eyeballs attraction that caused increasing in Bitcoin price along with mining difficulty.

Increasing mining difficulty rate made miners harder to do mining using CPUs this time GPUs come as a saviour for miners to full fill their dream of earning Bitcoins.

The fun fact is – during CPU mining era Satoshi Nakamoto (creator of Bitcoin) mined between 150,000 and 1,000,000 BTC’s.

GPU Mining.

As Bitcoin became more and more famous miners frustrated with their CPU capacity, so they started to use GPU to enhance the mining process.

Before miners started to using GPUs they mainly used in gaming applications to run graphics smoothly after 2010 the OpenCL language came out, helping miners to use GPU in mining.

OpenCL main purpose is to use the GPU to do things other than graphics on CPU and miners grabbed this opportunity to start using GPU to mine the Bitcoin.

Because compared to CPU a GPU six-time more efficient and cost-effective to do Bitcoin mining also they can be overclocked.

Even miners go further steps by adding many GPU cards to gain more speed in mining.

But adding multiple GPU’s to get speed is lead to more problems like heating and power consumptions, these problems forced miners to look for other hardware components that dedicated to do mining.

FPGA (Field Programmable Gate Array).

FPGA is like a graphic card, but it is completely programmable and uses the less power to produce twice amount of results than GPU.

In 2011 miners realize that mining using GPU’s is not feasible, so they started to switch their focus into FPGA mining because at that time first implication of Bitcoin mining program is come out in Verilog (a hardware design language that’s used to program FPGA).

Like in GPUs miners started to mine using a lot of FPGAs by building their own mining rigs.

But the reign of FPGA is not last as long as GPU, because to work with FPGAs miner have to have deeper programing language for setting them up and they’re not available on every store also it turned out that the cost per performance is an only gained incrementally over a graphic cards, even though the performance on FPGA went up.

Now miners started to looking for the hardware component that is more powerful and ASICs came out to fill that gap.

ASIC Mining.

Application Specific Integrated Circuits, aka ASIC, came into the market in 2013 designed by the China-based computer hardware manufacturer called Canaan Creative.

ASIC chip is pre-designed and built from scratch to do nothing expect than the Bitcoin mining wherein CPU, GPUs and FPGAs miner have to manually set them to do mining.

Also, as compared to the 2009 average CPU units, ASICs are 100 billion times faster and since it’s inception ASIC chip is becoming faster and faster by shrinking in the size.

As miners did in GPUs and FPGAs adding more to get more speed, they also did in ASICs by building big mining farms that continuously run in a cool place like Iceland to avoid heating.

Now many companies are providing a new version of ASIC devices.

Conclusion.

Above is the list of mining hardware helping miners to do Bitcoin mining still ASIC hardware is in the top of the list because it’s unbeatable performance than other hardware and GPUs are most affordable hardware components still miners using them.

Beside of all these different types of hardware available on the market, miners don’t get a steady and regular income, so they build mining pools where many miners come together to share their mining power and get incentives according to how much power they contributed to the pool to get a steady income from the hardware.

Also, miners rent out their hardware to someone who can’t afford powerful mining hardware using pools or cloud mining to get a steady income.

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