Monday, 21 June 2021

Bitcoin – A complete guide 2021

 Bitcoin these days are in great trend. Almost every investor or those who are planning to invest in are considering the bitcoin at least once. Do you know what bitcoin actually is? Here in this guide, today we will discuss on every thing related to discuss. First we will earn what bitcoin actually is. So let’s  get started.

What is Bitcoin?

Bitcoin can be defined as the digital currency. It is basically a idea set on a white paper by Satoshi Nakamoto. With this kind of digital currency, people will get the feature of lower transaction fees in comparison to the traditional online payment mechanism. It follows the decentralized authority and thus is more secure and convenient in compare to the government issued currencies. 

We can define Bitcoin is a type of crypto currency and there is no physical form of the bitcoin. Since there is no physical appearance of the bitcoin, the consumers will get the transparent access to the public ledger only. The transactions related to the bitcoin are verified by the lots of computing power and thus are highly secure and reliable currency. Bitcoin has become very popular in different part of world and has also triggered the launch of several more kind of crypto currencies.

Important points related to Bitcoin

  • The bitcoin crypto currency was first launched in 2009 and has now become the world largest digital currency by the market capitalization.
  • This kind of crypto currency, Bitcoin is used to created, distributed, traded, and stored by the help of a decentralized kind of ledger system which is known as Blockchain.
  • The history of Bitcoin in the terms of value has been turbulent. This kind of digital currency has gone multiple cycles of bust and boom in its very short life time.
  • The bitcoin is the first or the earliest crypto currency which has got this much popularity and has inspired the launch of several other kind of crypto currency as well.     

History of Bitcoin

The domain in name of Bitcoin.org was first registered on 18 August, 2008 and the domain under the bitcoin is WhoisGuard protected. This means that the identity of the person who registered this is not a public information.

On 31 October, 2008, the mystery person with the name of Satoshi Nakomato announced ay metzdowd.com to all the cryptography mailing list that he has been working on a new kind of electronic cash system that is completely peer to peer and has no trusted third party.

The first bitcoin was mined on 3 Jan 2009 and this was named as genesis block. On 8 jan, 2009, there was announcement of the first version of the bitcoin software to the cryptography mailing list. On 9 Jan, 2009, the Block 1 was mined and its mining commences in earnest.

Understanding Bitcoin

The system of bitcoin can be understood as the collection of the computers or we can say the nodes or minors that all collectively runs bitcoin code and store its Blockchain.

The block chain can be defined as the collection of multiple blocks and each block contains a collection of transactions. As all the computers who are running the blockchains are having the same block lists and transactions and thus all can see these blocks transparently and see the new blocks filled with new bitcoin transaction and thus no one can cheat in the system.      

Also, all the people who are whether running the node or not running it, still are allowed to see all these transactions that are occurring in the real time. In order to make any nefarious act, any bad person will require to operate up to 51% of the computing power that are making up the bitcoin. As per the report of 2021, there are currently more than 10,000 nodes operating the bitcoin generation process and this number is growing continuously and thus decreasing the chances of occurance of such attack.

But in the case when this kind of attack happens, the bitcoin miners (People who are taking part in the bitcoin network with their computers? Nodes) will get the option to fork to the new Blockchain and thus making the bad attack waste. 

The bitcoin balances are kept secured with the help of public as well as the private keys that are a strings of letters and number which are linked together through the mathematical encryption algorithm which was used in order to create them.

The public key can be compared with the bank account number that serve as address published to the world and to which it is possible to send bitcoin. While the private key is more comparable to the ATP PIN which is helpful in guarding the secret and is only used in order to authorize bitcoin transmission.

Peer to peer technology

The bitcoins are among the earliest crypto currencies and it uses the peer to peer technology in order to facilitate the instant payment.

All the independent users and even the companies are allowed to own the computing power in order to participate in the network of bitcoin miners and they need to pay the charge in order to process and transect on the Blockchain. In reverse, they will be motivated with rewards.

The bitcoin miners can be considered as the decentralized authority in order to enforce the credibility of the bitcoin network.

Bitcoin mining

The bitcoin mining process can be defined as the process to release  the bitcoin into circulation. In order to mine the bitcoins, the miner will need to solve the computationally difficult puzzle and need to discover a new block which is added to the block chain. Miners on releasing the bitcoin in circulation will be awarded with some bitcoins. There will need for the variety of the software in order to mine bitcoin. Some software are more helpful in earning higher rewards. These software includes Application –specific integrated circuits, and many more advanced processing units like GPU (Graphic Processing Units) and these will help the miners in earning rewards.

The bottom line

So these are related to the Bitcoin, crypto currency!

 

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