All you need to know about Bitcoin

All you need to know about Bitcoin

Bitcoin is a new crypto currency created by an anonymous person named Satoshi Nakamoto in 2008 and released as open source software. This system was published in a paper called “Bitcoin: A Peer-to-Peer Electronic Cash System.” Bitcoin is also termed as “BTC” as units.

The transaction takes places between users without any intermediary and it is world’s first decentralized digital currency. And it is also a distributed network.

The technology behind Bitcoin

The Blockchain is seen as the main technological innovation of bitcoin, since it stands as proof of all the transactions on the network.

The Blockchain is a shared public ledger on which the entire bitcoin network relies. The public ledger keeps tracks of all the transactions that has taken place in the bitcoin network.

A Block is the “current” part of a blockchain which records some or all of the recent transactions, and once completed, goes into the blockchain as permanent database. Each time a block gets completed, a new block is generated.

Why should we use bitcoin?

Bitcoin serves as a solution to the problem of double-spending, safe and secure, easy to access, Fast peer-to-peer transactions, Worldwide payments and Low processing fees.

Bitcoin is a digital asset that can be stored only in the wallets, clouds and also in your hardware devices.

The wallets are classfied as Software wallets facilitates online transactions whereas, physical and hardware wallets facilitates offline transactions.

How to get Bitcoin?

Bitcoin can be obtained either by cash or through mining. You can buy bitcoin through exchange for your money provided by bitcoin service provider and can earn bitcoin through mining process.

Suggested article: Know the units of Bitcoin

What is Bitcoin mining?

Bitcoin mining is the process of adding transaction records to Bitcoin’s public ledger of past transactions or blockchain. This ledger of past transactions is called the block chain as it is a chain of blocks.

The mining process involves solving of complex transaction problems or puzzles to earn rewards as bitcoin.

The finished complex transaction problems are recorded as blocks, each time when the miner solves or finishes a block he gets a reward in the form of bitcoin, this how new bitcoins are created.

Inorder to earn more bitcoin you have to solve more transactions problems. Anyone with access to the internet and suitable hardware can participate in mining.

Hardware needed for bitcoin mining

In the earliest days of Bitcoin, mining was done with CPUs from normal desktop computers.  Graphics cards, or graphics processing units (GPUs), are more effective at mining than CPUs and as Bitcoin gained popularity, GPUs became dominant.

Eventually, hardware known as an ASIC, which stands for Application-Specific Integrated Circuit, was designed specifically for mining bitcoin and was launched on 2013. Updates for the hardware done regularly.

These Hardwares are hugely expensive, so you can use cloud mining for a minimal prize.

Bitcoin Cash

With increasing number of people using bitcoin, the transactions tends to become slow. Because the size of block is limited to 1 mega bytes (Mb).

So, the bitcoin community created a fork of the original bitcoin (bitcoin core or bitcoin classic) called Bitcoin Cash.

Bitcoin cash is a cryptocurrency is a fork of Bitcoin Classic that was created in August 2017. Bitcoin Cash increases the size of blocks from 1 Mb to 8 Mb, allowing more transactions to be processed.

There are only 21 Million bitcoins in total.

Read more: Units of Bitcoin

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