How Does the Target Hash Value Relate to the Mining Difficulty?
The target hash value is a specific number that a block's hash must be less than or equal to for the block to be considered valid. The mining difficulty is inversely proportional to this target hash value.
When the difficulty increases, the target hash value decreases, meaning miners must find a hash with more leading zeros (a rarer hash), which requires more computational work. Conversely, when the difficulty decreases, the target hash value increases, making it easier to find a valid block.
Glossar
Target Hash
Hash ⎊ The cryptographic hash, within the context of cryptocurrency derivatives and options, represents a unique, fixed-size alphanumeric string generated from an input dataset using a hashing algorithm.
Hash Value
Definition ⎊ A hash value, also known as a hash digest or simply a hash, is the fixed-size output generated by a hash function from an arbitrary input.
Mining Difficulty
Algorithm ⎊ The mining difficulty, fundamentally, represents a dynamically adjusted parameter within blockchain networks, primarily designed to maintain a consistent block generation rate irrespective of computational power fluctuations.
Difficulty Target
Challenge ⎊ The Difficulty Target, within cryptocurrency derivatives and options trading, represents a dynamically adjusted threshold influencing mining rewards or contract payouts.
Target Hash Value
Reference ⎊ The specific numerical value that the current block's hash must be less than or equal to, as determined by the network's current difficulty setting, in order for the block to be accepted as valid.