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I am very much curious to know how difficulty is related to the mining process and how the static difficulty will effect the mining process ?

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Difficulty is proportional to hash power. The Ethash algorithm increases difficulty by increasing it if the last blocks have been found in shorter time than usual and decreases it if it was found in lower time. So that in average a ~14s blocktime is achieved. A static difficulty would decrease the average blocktime as more miners join. Eventually the mining time would be under the propagation of transactions in the network and only empty blocks would be mined. Therefore the difficulty adjustment is motivated to give transactions some time to be broadcasted to the network.

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