[BobMarin]

The reason is much more Machiavellian, namely if you keep the price of entry high and you loose money to mine for 80% of the time then the 20% of the time that it's extremely profitable you have a bigger multiple since the competition is weaker then it would've been otherwise.

[knodi123]

is mining competitive, though?

[eurleif]

Absolutely. A fixed reward (25 BTC) is rewarded each time a block is mined. Each block is based on the prior blocks in the chain, so when one miner mines a block, all the other miners must start over. Blocks are mined on average once every ten minutes, so basically, a random miner is selected approximately once every ten minutes to receive a reward.

[hueving]

Saying they have to start over is implying that you're somehow making progress. The only progress your are making is just ruling out a few inputs from a massive search space. You don't really lose any work when it resets because the work you've done is useless.

[kbenson]

I understand the semantic difference, but I'm not sure the distinction matters in any way. The implication that there is progress is tenuous at best.

[clarkm]

Of course they lose work. They have to pay the set-up cost of bundling a new set of transactions for the next block.