In this video I break the somewhat confusing and mysterious question of how exactly the block difficulty is defined, represented and updated.
There is a simplification/misconception that the requirement is just to find a hash with a required number of leading zeros in hex. This is not the case, it’s a little more intricate than that….
I show some examples of real blocks – in particular focusing on the genesis block, and how import it is for initializing the difficulty of mining a block.
I clarify the relationship between BITS (in the block header) difficulty, and the actual 256 hash target.
Difficult history chart