WEBVTT - Will LHR tech solve the graphics card shortage problem? 0:00:04.400 --> 0:00:07.800 Welcome to tech Stuff, a production from I Heart Radio. 0:00:12.119 --> 0:00:14.720 Hey there, and welcome to tech Stuff. I'm your host, 0:00:14.840 --> 0:00:17.320 John van Strickland. I'm an executive producer with I Heart 0:00:17.440 --> 0:00:21.880 Radio and I love all things tech. And Twitter user 0:00:22.160 --> 0:00:25.160 Janusian w O seven asked if I could do an 0:00:25.160 --> 0:00:31.000 episode talking about LHR versus non LHR or f HR 0:00:31.440 --> 0:00:35.240 graphics cards, And that's actually a gateway question to really 0:00:35.280 --> 0:00:40.400 dive into the proof of work style cryptocurrency mining operations. 0:00:40.880 --> 0:00:44.760 So today we're gonna talk about what that process actually involves, 0:00:45.360 --> 0:00:49.760 how that process has affected the graphics card industry, what 0:00:50.440 --> 0:00:54.560 a s i C is, what an fpg A is, 0:00:55.160 --> 0:00:58.080 and how companies like Nvidia are trying to respond to 0:00:58.120 --> 0:01:00.400 the issue so that gamers can act they get their 0:01:00.400 --> 0:01:03.800 grubby little hands on graphics cards because, in case you're 0:01:03.840 --> 0:01:08.160 not familiar, uh, graphics cards are sometimes very hard to 0:01:08.160 --> 0:01:11.840 get hold of, especially to get hold of at their 0:01:11.880 --> 0:01:16.840 market price. They often end up on secondary markets at 0:01:17.080 --> 0:01:20.920 ridiculous markups. So we'll also touch on some other elements, 0:01:20.959 --> 0:01:24.120 like the proposed stopping the grinch bought acts in the 0:01:24.200 --> 0:01:27.360 United States, But first let's talk about what it takes 0:01:27.440 --> 0:01:32.920 to mine some cryptocurrency that uses the proof of work approach. Now, 0:01:33.200 --> 0:01:37.880 first of all, what the heck does mining mean? I mean, 0:01:37.920 --> 0:01:42.840 cryptocurrency is digital, right, It's just a digital record when 0:01:42.840 --> 0:01:45.200 you get down to it. So when you really boil 0:01:45.240 --> 0:01:48.440 it all down, you ultimately get to machine language of 0:01:48.560 --> 0:01:52.680 zeros and once. How the heck do you mind zeros 0:01:52.680 --> 0:01:57.160 and ones? Well, since the whole intended point of Bitcoin, 0:01:57.760 --> 0:02:02.240 which is, you know, kind of the the cryptocurrency that 0:02:02.320 --> 0:02:05.600 really started at all, at least as far as the 0:02:06.280 --> 0:02:10.919 current craze is concerned. If you assume that the creators 0:02:11.000 --> 0:02:15.119 of bitcoin were being sincere they wanted it to perform 0:02:15.320 --> 0:02:18.080 as a currency, well, that means you have to have 0:02:18.160 --> 0:02:20.359 some sort of systems in place in order to make 0:02:20.400 --> 0:02:24.600 this happen. So let's take Bitcoin as our example. Though, 0:02:24.680 --> 0:02:29.240 just to be clear, the issue with graphics cards doesn't 0:02:29.280 --> 0:02:33.720 relate to bitcoin. Bitcoin has outgrown graphics cards. When we 0:02:33.760 --> 0:02:39.160 talk about cryptocurrency, mining and graphics cards, we're more frequently 0:02:39.160 --> 0:02:42.960 talking about ethereum, not Bitcoin. But we'll get more into 0:02:43.000 --> 0:02:46.640 that later in this episode. But Bitcoin is the easy 0:02:46.639 --> 0:02:48.360 one to talk about, right because that's the one that 0:02:48.480 --> 0:02:50.520 everyone has heard about. A lot of people have heard 0:02:50.560 --> 0:02:54.560 about ethereum, but not as many as have heard about bitcoin. 0:02:54.720 --> 0:02:57.680 So in order for bitcoin to work, you need to 0:02:57.720 --> 0:03:02.760 have a record or ledger of who has bitcoin and 0:03:02.800 --> 0:03:07.000 who is transferring bitcoin to whom. So without a verifiable 0:03:07.000 --> 0:03:10.960 record of all the bitcoin that are in circulation, it 0:03:11.000 --> 0:03:15.000 would be possible for someone to duplicate a bitcoin and 0:03:15.080 --> 0:03:19.520 to spend it repeatedly. Right, It's just a digital file. 0:03:19.680 --> 0:03:22.160 You can copy digital files. I'm sure you've done this 0:03:22.520 --> 0:03:26.320 thousands of times, whether it's to copy a file from 0:03:26.360 --> 0:03:29.000 your hard drive to go also onto a network drive 0:03:29.480 --> 0:03:32.720 or maybe onto some form of physical media, or maybe 0:03:33.360 --> 0:03:36.000 you're just copying a file on your own computer multiple 0:03:36.000 --> 0:03:39.200 times for some reason. I don't I'm not judging you anyway. 0:03:39.280 --> 0:03:42.160 Duplicating files is easy, Like it's just a couple of 0:03:42.720 --> 0:03:47.800 clicks on your mouth, right, So that would mean that 0:03:47.880 --> 0:03:50.960 you have to have a way to counteract that for 0:03:51.520 --> 0:03:56.760 digital currency, otherwise you could just print your own money essentially, 0:03:56.920 --> 0:03:58.800 And they have to be able to prevent people from 0:03:58.880 --> 0:04:03.360 copying or counterfeit bitcoin, otherwise the whole system would collapse. 0:04:03.720 --> 0:04:08.400 So one element that helps with this is a distributed 0:04:08.560 --> 0:04:13.080 ledger of all transactions. To be involved in bitcoin mining, 0:04:13.400 --> 0:04:17.400 you have to connect to the Bitcoin network, and everyone 0:04:17.480 --> 0:04:21.479 connected to this network can see a shared ledger that 0:04:21.600 --> 0:04:25.800 records each and every transaction dating back to the origin 0:04:25.920 --> 0:04:31.360 of bitcoin itself. Actually, the transactions propagate outward from their 0:04:31.400 --> 0:04:34.359 point of origin throughout the network. It can take a 0:04:34.360 --> 0:04:37.480 little bit of time, as much as fourteen seconds. In fact, 0:04:38.160 --> 0:04:41.560 that is an issue that is a limiting factor for 0:04:41.680 --> 0:04:46.200 bitcoin in particular. But it's a that's a that's a 0:04:46.279 --> 0:04:49.200 matter for another podcast because it goes a little beyond 0:04:49.240 --> 0:04:52.039 what we want to talk about today. So Bitcoin protects 0:04:52.040 --> 0:04:56.280 itself in part by having this ledger visible to everyone 0:04:56.320 --> 0:04:58.960 in the system, so that it would be pretty much 0:04:59.000 --> 0:05:04.320 impossible for someone to to cheat the system because everyone 0:05:04.400 --> 0:05:08.360 can see the history of transactions. It gets more technical 0:05:08.360 --> 0:05:11.320 than that, but we'll leave it here. However, you also 0:05:11.360 --> 0:05:15.960 have to have a way to verify transactions to authorize payments. 0:05:16.040 --> 0:05:19.200 So let's say you're going to a brick and mortar store. 0:05:19.320 --> 0:05:23.039 This is just like a an example from everyday life. 0:05:23.080 --> 0:05:27.360 So you're going to a store physically yourself, and you 0:05:27.920 --> 0:05:29.880 fill your shopping card up with whatever it is that 0:05:29.920 --> 0:05:32.000 you're buying, and you're going to use a credit card 0:05:32.040 --> 0:05:33.760 to pay for it. So when you go up to 0:05:33.800 --> 0:05:37.480 the cashier and you swipe your credit card or inserted 0:05:37.520 --> 0:05:40.000 into the machine, whatever it is, the system does a 0:05:40.080 --> 0:05:42.839 quick check to make certain that you have the available 0:05:42.880 --> 0:05:46.839 credit in order to make that purchase. So in this case, 0:05:46.880 --> 0:05:49.880 the point of sale at the cashier would send an 0:05:49.880 --> 0:05:54.760 electronic request to the appropriate bank or processor for that 0:05:54.920 --> 0:05:59.120 particular merchant via a phone line or an internet connection. 0:05:59.400 --> 0:06:02.880 So the request goes from the merchant to a bank. 0:06:03.360 --> 0:06:06.000 That bank then forwards the details of the credit card 0:06:06.040 --> 0:06:10.479 to a credit card network like Visa for example, that 0:06:10.560 --> 0:06:13.880 can then clear the request to send a message on 0:06:14.040 --> 0:06:18.600 to whatever bank issued the credit card, and it's this 0:06:18.720 --> 0:06:22.599 bank that authorizes payment if you have the available credit 0:06:22.640 --> 0:06:26.000 if everything lines up. In other words, so if it's 0:06:26.040 --> 0:06:29.479 clear that the credit card is is a valid card 0:06:29.600 --> 0:06:33.080 and that there is UH credit on it. In the 0:06:33.120 --> 0:06:35.719 case of filling out stuff online, it would check things 0:06:35.720 --> 0:06:37.760 to make sure that the building address that you filled 0:06:37.760 --> 0:06:39.680 out matches the one that's in the records, all that 0:06:39.760 --> 0:06:43.160 kind of stuff. So, assuming everything is cool, the issuing 0:06:43.160 --> 0:06:46.440 bank since the approval backed down the same chain, so 0:06:46.560 --> 0:06:49.640 the approval goes to the credit card network. The credit 0:06:49.680 --> 0:06:53.479 card network then sends that over to the merchant's bank. 0:06:53.760 --> 0:06:55.839 The merchants bank then sends it to the merchant and 0:06:55.880 --> 0:06:59.880 says transaction complete. The money has been transferred from the 0:07:00.000 --> 0:07:03.159 airline of credit to you, and the merchant then prints 0:07:03.240 --> 0:07:07.039 up a slip that's usually either you sign it or 0:07:07.080 --> 0:07:10.239 it's just a you know, receipt. UH. This whole process 0:07:10.280 --> 0:07:14.600 takes very little time typically with the classic system. Right, 0:07:15.120 --> 0:07:20.320 We've got incredibly fast communication systems, so assuming everything's working it, 0:07:20.400 --> 0:07:22.600 there's rarely much of a delay. You might be standing 0:07:22.600 --> 0:07:25.560 there for a couple of seconds while you're waiting for 0:07:25.640 --> 0:07:28.200 the approval to go through, but it doesn't take long 0:07:28.240 --> 0:07:32.360 at all. UH. There's also transaction fees that are involved 0:07:32.400 --> 0:07:35.120 with this. That's important too because it's going to play 0:07:35.160 --> 0:07:39.960 into cryptocurrency. So with this approach, merchants who accept credit 0:07:40.000 --> 0:07:43.760 cards also have to pay transaction fees on every sale 0:07:44.000 --> 0:07:47.480 that involves a credit card. UH. It's usually a small 0:07:47.520 --> 0:07:51.320 percentage of whatever the overall price is for the items, 0:07:51.440 --> 0:07:55.560 and merchants typically seek out the cheapest available processing fees, 0:07:55.880 --> 0:07:59.640 or they might also you know, increase the price of 0:07:59.640 --> 0:08:02.800 their products to help compensate for that expense, or they'll 0:08:02.800 --> 0:08:07.000 do both. So credit cards have these centralized authorities, the 0:08:07.120 --> 0:08:12.400 issuing banks. They ultimately authorized transactions and they verify that 0:08:12.520 --> 0:08:15.440 money has changed hands. So again, in this case, it 0:08:15.440 --> 0:08:17.360 would be a line of credit issued to the card 0:08:17.400 --> 0:08:21.040 holder and then transferred over to the merchant that amount 0:08:21.040 --> 0:08:24.040 of money. But one of the big selling points of 0:08:24.040 --> 0:08:29.520 cryptocurrencies like bitcoin is that there is no centralized financial 0:08:29.640 --> 0:08:32.200 authority at the middle of all this. There is no 0:08:32.280 --> 0:08:36.400 issuing bank, but you still have to verify transactions otherwise 0:08:36.760 --> 0:08:39.160 we get back to that problem that someone could duplicate 0:08:39.160 --> 0:08:43.760 cryptocurrency and crash the whole system. So the way bitcoin 0:08:43.840 --> 0:08:48.080 does this is it groups transactions together in blocks, and 0:08:48.160 --> 0:08:52.160 these blocks form a chain, a block chain if you were, 0:08:52.880 --> 0:08:57.239 and bitcoins blocks currently have a limit of one megabyte 0:08:57.240 --> 0:09:00.640 in size. That's how big a blockchain block in bitcoin 0:09:00.720 --> 0:09:04.920 can be. In twenty nineteen, a simple transaction from one 0:09:04.960 --> 0:09:10.120 Bitcoin wallet to another would take up around around the bytes. Now, 0:09:10.240 --> 0:09:12.640 if you do some math and you take one megabyte 0:09:12.679 --> 0:09:15.720 and you divide it by three eight bytes, you end 0:09:15.840 --> 0:09:19.559 up with around two thousand, seven hundred and sixty transactions. 0:09:19.559 --> 0:09:22.240 A little less than that, actually, uh, that can fit 0:09:22.320 --> 0:09:25.880 in one block of the Bitcoin blockchain, so two thousand, 0:09:26.520 --> 0:09:30.320 seven sixty or so uh per block. By the way, 0:09:30.320 --> 0:09:33.360 this leads us to some serious limitations of bitcoin when 0:09:33.400 --> 0:09:35.800 it comes to actually using it as a currency, but 0:09:35.880 --> 0:09:40.000 again that's the story for another matter, another podcast episode. So, 0:09:40.559 --> 0:09:43.440 the way the bitcoin system currently works is that a 0:09:43.440 --> 0:09:47.360 block of transactions are to join the chain every ten minutes. 0:09:47.679 --> 0:09:50.319 So really the goal here is that every ten minutes 0:09:50.400 --> 0:09:54.400 you add a block, whether it's full of transactions or not. 0:09:54.960 --> 0:09:57.080 So even if let's say it's a super slow time 0:09:57.120 --> 0:09:59.600 and there's not that many transactions, you still need to 0:09:59.640 --> 0:10:01.839 add a block every ten minutes, because that's just the 0:10:01.880 --> 0:10:05.040 way the system works. So you have all these computers 0:10:05.080 --> 0:10:09.360 that connect to the bitcoin network, right these are uh 0:10:09.600 --> 0:10:11.959 and then you have all these transactions that are waiting 0:10:11.960 --> 0:10:15.800 for verification. So every time a bitcoin has changed hands, 0:10:16.040 --> 0:10:18.640 as it were, all of that has to be verified. 0:10:18.840 --> 0:10:21.360 So the computers that are connected to the bitcoin system, 0:10:21.600 --> 0:10:25.199 the miners, in other words, when you really break it down, 0:10:25.440 --> 0:10:29.240 their auditors. They are auditing the list of transactions to 0:10:29.400 --> 0:10:32.840 verify that they are all valid transactions, that in fact 0:10:33.600 --> 0:10:37.800 the entity that transferred bitcoin to another entity, that all 0:10:37.840 --> 0:10:40.600 of that is accurate and valid that in fact there 0:10:40.800 --> 0:10:44.760 was that bitcoin to transfer, that the wallet it came 0:10:44.800 --> 0:10:47.320 from is valid, and the wallet it's going to is valid. 0:10:47.640 --> 0:10:50.720 The computers connected to the bitcoin system are all trying 0:10:50.800 --> 0:10:53.960 to process this at the same time. They're taking on 0:10:54.000 --> 0:10:56.840 a role that would normally go to a centralized bank authority, 0:10:57.160 --> 0:11:00.040 and instead of a merchant paying a transaction fee of 0:11:00.080 --> 0:11:04.440 the auditors, you've got the bitcoin system itself releasing some 0:11:04.480 --> 0:11:09.440 bitcoin into circulation, and that that circulation goes straight to 0:11:09.640 --> 0:11:14.280 whichever auditor is able to verify the transactions first. That's 0:11:14.320 --> 0:11:17.920 the mining element here, So when you mine bitcoin, what 0:11:18.040 --> 0:11:21.760 really means is that you were able to validate a 0:11:21.840 --> 0:11:27.320 block of transactions before anyone else could. Now, interestingly, bitcoin 0:11:27.400 --> 0:11:30.360 mining will only last as long as there are bitcoin 0:11:30.679 --> 0:11:33.959 left to be mined. But there is a finite amount 0:11:33.960 --> 0:11:36.360 of bitcoin. There didn't have to be, you know, you 0:11:36.400 --> 0:11:39.240 could have created a system where there is no limit, 0:11:39.520 --> 0:11:42.200 but that's not how bitcoin was designed. So there's actually 0:11:42.240 --> 0:11:45.800 a cap of twenty one million bitcoin, and once they 0:11:45.800 --> 0:11:49.200 are all mined, there will be no new bitcoin going 0:11:49.200 --> 0:11:54.400 into circulation. Interestingly, the number of bitcoin released upon verifying 0:11:54.440 --> 0:11:57.920 a block of transactions goes down by half every two 0:11:58.200 --> 0:12:02.720 d thousand blocks, which because a new block has added 0:12:02.760 --> 0:12:05.120 every ten minutes or so, we can essentially say that 0:12:05.200 --> 0:12:09.439 around four years, you see the number of bitcoins released 0:12:09.960 --> 0:12:14.480 per block, mind go get cut in half. So when 0:12:14.480 --> 0:12:17.439 bitcoin first launched back in two thousand nine, if you 0:12:17.480 --> 0:12:20.520 were to mind a block of transactions, that would get 0:12:20.559 --> 0:12:23.160 you fifty bitcoins. So if your computer was the first 0:12:23.160 --> 0:12:26.160 one to mind it, you got fifty bitcoin. Now, back then, 0:12:26.559 --> 0:12:30.160 bitcoins were worth a fraction of a dollar, right, fifty 0:12:30.160 --> 0:12:34.640 bitcoin was nothing back then. Today a single bitcoin is 0:12:34.679 --> 0:12:38.199 worth more than fifty seven thousand dollars at least as 0:12:38.600 --> 0:12:40.960 I record this episode, that's where the value is. It's 0:12:41.000 --> 0:12:44.880 above fifty seven thousand dollars per bitcoin. So imagine that 0:12:45.000 --> 0:12:47.920 you were able to get fifty bitcoin for mining a block. 0:12:48.440 --> 0:12:51.160 That means, assuming that the value was the same back 0:12:51.160 --> 0:12:53.880 then it wasn't, but let's say it was. That would 0:12:53.920 --> 0:12:57.199 mean you would pull in two point eight five million 0:12:57.520 --> 0:13:02.320 dollars just for verifying block of transactions, and another block 0:13:02.320 --> 0:13:05.240 would join every ten minutes. So let's say that you 0:13:05.280 --> 0:13:09.760 had built out the best mining system to verify transactions, 0:13:10.120 --> 0:13:13.000 and if bitcoin had been as valuable back then as 0:13:13.040 --> 0:13:16.720 they are today, then you would soon be a billionaire, except, 0:13:16.720 --> 0:13:19.559 of course bitcoin weren't worth nearly as much back then. 0:13:19.600 --> 0:13:22.440 In fact, people would spend thousands of bitcoin just to 0:13:22.440 --> 0:13:26.800 buy a pizza. It's a very different world. But the 0:13:26.880 --> 0:13:30.640 number of bitcoin released per block has gone down since 0:13:30.840 --> 0:13:36.000 two thousand nine. In it was twenty five per block, 0:13:36.559 --> 0:13:39.880 so went from fifty to twenty five. It reduced again 0:13:39.920 --> 0:13:43.839 to twelve point five bitcoin per block. Mind today it's 0:13:43.880 --> 0:13:48.079 at six point to five bitcoin per block. That process 0:13:48.240 --> 0:13:51.680 will continue until nearly all bitcoin or mind. The fact 0:13:51.679 --> 0:13:54.480 that you're having and having and having means that eventually 0:13:54.480 --> 0:13:56.679 you get to a point where it's like, not all 0:13:56.720 --> 0:13:59.480 bitcoin will actually be mine. There'll be some that will 0:13:59.720 --> 0:14:03.280 rum unmind, but it's like a tiny, tiny, tiny fraction, 0:14:03.440 --> 0:14:06.839 right um. But that means that once you get to 0:14:06.920 --> 0:14:09.199 that point and there are no more bitcoin to mind, 0:14:09.520 --> 0:14:13.599 then auditors will not be paid out in mind bitcoins 0:14:13.800 --> 0:14:16.960 because they're they're all gone. Instead, they'll be paid in 0:14:17.080 --> 0:14:21.600 transaction fees, very similar to the way that merchants have 0:14:21.680 --> 0:14:26.960 to pay transaction fees on credit card purchases in their establishments. Anyway, 0:14:27.520 --> 0:14:30.560 that whole system of bitcoin, where we're only looking at 0:14:30.560 --> 0:14:33.320 transaction fees. That's the good ways off. In the future, 0:14:33.360 --> 0:14:37.200 it won't be tillt before all the bitcoin or mind. 0:14:37.520 --> 0:14:41.400 So for now, the promise of mind. Bitcoin provides an 0:14:41.440 --> 0:14:46.640 incentive to miners to dedicate their computer processing power to 0:14:47.040 --> 0:14:50.120 verify blocks of transactions. And when I say computer processing power, 0:14:50.120 --> 0:14:52.800 I'm not talking about the desktop or a laptop. I'm 0:14:52.840 --> 0:14:57.480 talking about specialized machines that are drawing enormous amounts of 0:14:57.520 --> 0:15:01.040 power in order to process this as fast as possible. Now, 0:15:01.040 --> 0:15:04.840 the mining process fulfills some very important functions. It creates 0:15:04.840 --> 0:15:08.160 a predictable rate of adding more bitcoin to circulation. We 0:15:08.200 --> 0:15:10.360 know that every ten minutes we're gonna get six point 0:15:10.400 --> 0:15:13.760 to five more bitcoin, at least until we hit that 0:15:13.840 --> 0:15:17.000 next milestone, in which case it will be had yet again. 0:15:18.040 --> 0:15:21.320 And it also brings in auditors to perform the task 0:15:21.400 --> 0:15:24.880 of verifying transactions, which is necessary for the system to 0:15:24.920 --> 0:15:28.680 really work alright, So mining ultimately boils down to someone 0:15:28.760 --> 0:15:33.040 using a computer or these days bloods of specialized computers 0:15:33.080 --> 0:15:36.400 to comb through a block of transactions and verify them 0:15:36.400 --> 0:15:39.080 before anyone else does. And then the winning computer system 0:15:39.240 --> 0:15:42.640 gets some bitcoin for their trouble. But when I say, 0:15:42.760 --> 0:15:47.160 verifying it's kind of misleading, like that's one way to 0:15:47.200 --> 0:15:49.560 look at it. But really, what the computers are ultimately 0:15:49.600 --> 0:15:53.760 doing is trying to come up with a hash value 0:15:54.320 --> 0:15:59.359 that most closely matches one created by the bitcoin system. 0:15:59.400 --> 0:16:01.960 So we have to talk about hash values. And yes, 0:16:02.000 --> 0:16:06.400 this does tie in to those LHR graphics cards. So 0:16:07.000 --> 0:16:11.080 hash values are really good at establishing the identity of 0:16:11.120 --> 0:16:14.880 something like say a file. Uh so this gets a 0:16:14.920 --> 0:16:17.960 little confusing, but just stay with me, all right. So ultimately, 0:16:18.040 --> 0:16:21.000 you know, a computer file, just like any other computer 0:16:21.440 --> 0:16:25.320 information is data that you can ultimately reduce down to 0:16:25.440 --> 0:16:31.160 binary to zeros and ones using a hashing algorithm, which 0:16:31.280 --> 0:16:34.520 is essentially a set of rules that say this is 0:16:34.560 --> 0:16:39.320 the process of operations you should perform on any incoming data. Right, 0:16:39.920 --> 0:16:43.840 That's what an algorithm does, is just algorithms are just instructions. 0:16:43.880 --> 0:16:47.400 So a hashing algorithm is a specific type of algorithm 0:16:47.400 --> 0:16:52.760 where a machine takes this binary data these zeros and 0:16:52.840 --> 0:16:58.600 ones that represent a file, performs some mathematical operations on 0:16:58.640 --> 0:17:03.880 that data and generates a hash value. Hash value is 0:17:03.920 --> 0:17:07.520 a fixed length value, and it can you know if 0:17:07.520 --> 0:17:10.680 it's hexadecimal, it can contain numbers and and other characters 0:17:10.680 --> 0:17:15.400 as well. Um, so a lot of hashing algorithms convert 0:17:15.600 --> 0:17:19.120 data into hexadecimal values. I'm not gonna go deep into 0:17:19.200 --> 0:17:22.720 hexadecimal here. The important bit is that you have a 0:17:22.840 --> 0:17:25.719 fixed lengths set of values. That means you have a 0:17:25.760 --> 0:17:29.000 fixed number of characters that will always appear as a 0:17:29.040 --> 0:17:32.720 hash value no matter what you fed into the UH. 0:17:32.760 --> 0:17:36.280 The algorithm is going to produce an answer or a 0:17:36.320 --> 0:17:39.320 result that is that number of characters long. So let's 0:17:39.320 --> 0:17:42.960 say it's sixty four characters long. That means you feed 0:17:43.000 --> 0:17:45.959 a big file into this algorithm, it will generate a 0:17:45.960 --> 0:17:49.399 result that's sixty four characters long as a hash value. 0:17:49.800 --> 0:17:52.679 You feed a tiny file into the same algorithm, it 0:17:52.720 --> 0:17:58.560 will also generate a different sixty four character lengths UH 0:17:58.680 --> 0:18:02.200 hash value. So another words, just looking at the hash values, 0:18:02.520 --> 0:18:04.840 there's no way for you to tell what the size 0:18:04.880 --> 0:18:08.240 of the file was, let alone the content of that file, 0:18:08.320 --> 0:18:12.520 what type of file it was. But it will, which 0:18:12.560 --> 0:18:14.720 is why it's used on a lot of security measures 0:18:14.840 --> 0:18:17.840 right because just glancing at it doesn't give you enough 0:18:17.880 --> 0:18:20.359 information for you to draw any conclusions about what was 0:18:20.480 --> 0:18:23.840 fed into the algorithm. So again, let's say that we've 0:18:23.840 --> 0:18:26.520 got an algorithm that puts hash values that are sixty 0:18:26.520 --> 0:18:29.879 four characters in length. It doesn't matter how you know 0:18:30.200 --> 0:18:32.439 how large the file is, if it's huge or if 0:18:32.440 --> 0:18:35.760 it's tiny, you still get a sixty four character length answer, 0:18:35.920 --> 0:18:40.480 and you will always get that answer based upon the input. 0:18:40.960 --> 0:18:43.320 So if I have file A and I feed it 0:18:43.320 --> 0:18:46.840 through the algorithm a hundred times, I will get one 0:18:46.920 --> 0:18:50.800 hundred identical hash values. But if I feed file B 0:18:51.680 --> 0:18:55.360 into the algorithm a hundred times, I'll get that one 0:18:55.800 --> 0:18:57.439 same times, but it will be different from file A. 0:18:57.640 --> 0:19:01.080 Right like, the hash values are unique to whatever the 0:19:01.119 --> 0:19:05.200 input is. So hashes are also not reversible. You can't 0:19:05.440 --> 0:19:09.080 get a hash value and then magically reverse it back 0:19:09.119 --> 0:19:13.120 to the original file. So if you sent me a hash, 0:19:13.240 --> 0:19:15.679 I couldn't do anything with it other than really, you know, 0:19:15.720 --> 0:19:18.280 look at it and compare it against hash values that 0:19:18.359 --> 0:19:22.320 I have. I can't. I can't reverse it and say, oh, 0:19:22.560 --> 0:19:25.280 you took a copy of pac Man and you hashed it. 0:19:25.320 --> 0:19:28.199 I wouldn't know. So what you can do is you 0:19:28.200 --> 0:19:32.280 can use hash values to verify that a file, for example, 0:19:32.320 --> 0:19:35.320 that someone has is the exact same file that you have. 0:19:35.760 --> 0:19:39.000 You both use the same algorithm. They hash their file, 0:19:39.119 --> 0:19:42.240 you hash your file. They send you the hash value, 0:19:42.600 --> 0:19:44.879 not the file itself, and you compare it to your 0:19:44.920 --> 0:19:48.080 hash value. If it's the same, then you say, ah, 0:19:48.200 --> 0:19:51.520 we both have the same file. That's a way of 0:19:51.800 --> 0:19:56.000 verifying that someone is who they say they are. For example, 0:19:56.200 --> 0:19:59.320 like if you ask them to prove that they are 0:19:59.359 --> 0:20:02.040 who they claim to be, and they send you a 0:20:02.200 --> 0:20:06.080 hash value that could only come from them because it's 0:20:06.160 --> 0:20:08.439 unique to something they possess, and you have a record 0:20:08.480 --> 0:20:11.720 you have like a database that matches this, then you 0:20:11.720 --> 0:20:17.280 can say, ah, ha I got it. You're in Okay, 0:20:18.040 --> 0:20:20.600 that's basics for hash values. We're gonna take a quick 0:20:20.600 --> 0:20:22.440 break because I've been going on a long time here. 0:20:22.600 --> 0:20:24.640 When we come back, I'll talk a little bit more 0:20:24.680 --> 0:20:34.920 about hash values before we move on. Okay, I talked 0:20:34.960 --> 0:20:36.919 before the break about hash values and how you can 0:20:37.000 --> 0:20:40.479 use them for verification processes where you don't really know 0:20:40.600 --> 0:20:44.800 the content that was in the original piece. Necessarily you 0:20:44.920 --> 0:20:47.959 just can compare hash values to each other. Well, hashes 0:20:47.960 --> 0:20:50.040 are used in lots of other ways. So for example, 0:20:50.520 --> 0:20:55.040 some anti virus databases will take known malware and they'll 0:20:55.080 --> 0:20:59.119 create a hash value from the malware, and then anti 0:20:59.200 --> 0:21:02.159 virus saw where will have a whole database of all 0:21:02.160 --> 0:21:06.000 these hash values, and the antivirus software will search a 0:21:06.160 --> 0:21:11.199 suspected infected computer system and hash the various files that 0:21:11.240 --> 0:21:15.639 are on the computer system, compare it against that database 0:21:15.800 --> 0:21:19.520 of known malware hash values, and if it finds matches, 0:21:19.560 --> 0:21:23.119 it says, aha, your computer has been infected by the 0:21:23.200 --> 0:21:26.760 specific types of malware. All right, but let's let's go 0:21:26.800 --> 0:21:30.440 back to bitcoin and talk about what hash values mean 0:21:30.520 --> 0:21:34.600 for that. So, for each block of transactions in a 0:21:34.640 --> 0:21:39.439 bitcoin blockchain, the bitcoin system itself assigns a sixty four 0:21:39.480 --> 0:21:45.240 digit hexadecimal hash, and the auditors the miners are trying 0:21:45.280 --> 0:21:49.520 to generate a hash that is closest to the one 0:21:49.600 --> 0:21:54.280 provided by the system without going over. And the more 0:21:54.320 --> 0:21:57.960 miners that joined the system, the more possible solutions there 0:21:57.960 --> 0:22:02.040 will be to the hash value. So as more auditors join, 0:22:02.119 --> 0:22:07.120 as more computational processing power is added to the Bitcoin system, 0:22:07.160 --> 0:22:11.919 the bitcoin system increases the difficulty of the guessing game 0:22:12.000 --> 0:22:16.000 problem that all the computers are engaged in, and that 0:22:16.040 --> 0:22:18.880 means you have to have even more computing power if 0:22:18.920 --> 0:22:22.720 you want to be the one to first mind a 0:22:22.800 --> 0:22:28.760 block of transactions. Now, computing power is expensive, both to 0:22:28.920 --> 0:22:32.040 acquire all the pieces for the computing power and to 0:22:32.119 --> 0:22:35.040 maintain it. Right, you have to pay for specialized hardware 0:22:35.520 --> 0:22:38.399 because if you don't, then others will. Then you'll be 0:22:38.480 --> 0:22:42.480 left behind. Right the older stuff that you're using won't 0:22:42.480 --> 0:22:44.560 be up to task. It would be like if you 0:22:44.600 --> 0:22:48.360 were trying to enter a street race and you were 0:22:48.440 --> 0:22:52.760 driving like an old Volvo and everyone else is driving supercars. 0:22:52.840 --> 0:22:54.720 You would do it doesn't matter how good a driver 0:22:54.840 --> 0:22:58.000 you are, your your equipment just won't be able to 0:22:58.080 --> 0:23:01.560 keep pace and uh. And since bitcoin mining is effectively 0:23:01.600 --> 0:23:04.280 a race to guess a very complicated number as quickly 0:23:04.320 --> 0:23:07.680 as possible, being left behind means you're stuck with expensive 0:23:07.680 --> 0:23:11.280 equipment and a reward. So now you've got you know, costs, 0:23:11.760 --> 0:23:14.840 but you're not bringing money into offset those costs. You 0:23:14.840 --> 0:23:18.760 would be out of business. So there becomes this escalation 0:23:19.000 --> 0:23:21.920 among bitcoin miners to get hold of the most advanced 0:23:22.240 --> 0:23:26.760 machines possible that can work at screamingly fast rates in 0:23:26.800 --> 0:23:30.040 an effort to mind blocks before anyone else can so. 0:23:30.160 --> 0:23:33.640 Right now, a block is worth around three fifty six 0:23:33.720 --> 0:23:37.480 thousand dollars. I got that by multiplying fifty seven thousand 0:23:37.560 --> 0:23:41.960 dollars per bitcoin times six point two five bitcoins per block, 0:23:42.560 --> 0:23:45.960 and you get a new block mind every ten minutes. 0:23:46.880 --> 0:23:49.760 So a day has one thousand, four hundred forty minutes, 0:23:49.760 --> 0:23:52.800 and that means there are one hundred forty four ten 0:23:52.920 --> 0:23:58.080 minute blocks per day. So let's let's say hypothetically you 0:23:58.160 --> 0:24:05.240 create the best killer mining system and you improbably managed 0:24:05.280 --> 0:24:08.080 to beat out everyone else in the world for every 0:24:08.119 --> 0:24:11.879 single block in one day. That would mean one day's 0:24:11.920 --> 0:24:15.879 mining would let you fifty one million dollars at the 0:24:15.960 --> 0:24:21.160 current value of bitcoin per day, fifty one million dollars. 0:24:21.200 --> 0:24:24.639 That is a heck of an incentive. Now, this is 0:24:24.680 --> 0:24:28.639 why you hear about huge bitcoin mining operations that co 0:24:28.800 --> 0:24:33.359 locate with power plants, because to run those machines, you 0:24:33.440 --> 0:24:37.040 need a lot of electricity, and electricity costs money. Right Like, 0:24:37.080 --> 0:24:40.600 if you're if you're paying for your electricity, that bill 0:24:40.920 --> 0:24:43.800 is an operating expense you have to factor in. And 0:24:43.800 --> 0:24:47.080 while you could theoretically net around fifty one million dollars 0:24:47.080 --> 0:24:51.000 a day, in reality, you're you are competing against lots 0:24:51.040 --> 0:24:55.040 of other big bitcoin mining operations around the world. You're 0:24:55.040 --> 0:24:58.680 not going to succeed with every single block, So bitcoin 0:24:58.760 --> 0:25:01.640