What is Bitcoin?
The Concept. The technology. The unit of exchange. The protocol. It is all about the Bitcoin.
Everyone can speak obscurely, only the few can speak clearly.
Galileo Galilei
The same goes for Bitcoin explanation. Most definitions are obscure rather than understandable. We will do our best to be among the few who speak clearly.
Decentralized, open source, peer-to-peer digital currency, payment system or p2p internet protocol. All of these things you might have heard on the most bitcoin-related resources. We want to provide a deeper insight in the term Bitcoin.
Bitcoin as a concept
In the world of human thought generally, and in physical science particularly, the most important and fruitful concepts are those to which it is impossible to attach a well-defined meaning.
Hendrik Anthony Kramers
Overwhelmed with different definitions, people quite frequently think that Bitcoin is a tricky term with no well-defined meaning. In the majority they are right. Do not try to refer Bitcoin to something exact - it would make no sense. Try to embrace every piece of the information.
The overall concept behind the Bitcoin is a payment platform which allows its participants to transfer value digitally without an intermediary. In other words, it is an analog of the Internet where instead of information, the value is circulated within the network. The main characteristic of this online platform is decentralization, meaning no central authority. Thus, nobody can lose control of the Bitcoin system as nobody owes it. (As you know, you cannot lose the thing that you don’t owe.)
Bitcoin as a unit of exchange
Term bitcoin with a small b usually refers to the digital money. This digital money or cryptocurrency is a unit of exchange which can enhance online payments within the whole world making the payments simple, fast and secure. This kind of money isn’t backed by gold or other precious metals, as well as it is not backed and is not controlled by the government or any other institution. The supply of bitcoins is fixed at 21 million bitcoins.
Note: You need to differentiate the Bitcoin and the bitcoin terms. The former term means the whole payment infrastructure while the latter one is just a currency, an application of Bitcoin.
Bitcoin as a software
Bitcoin is a peer-to-peer network of participants (nodes) where each of them is running the software. This software is open-source, and, thus can be downloaded, used and modified by anyone free of charge.
Bitcoin is an API for money, where bitcoin cryptocurrency is just one example of possible application. Instead of it there can be smart contracts.
Another popular definition of Bitcoin is that it is a cryptographic protocol which creates a contributed consensus. To understand the protocol term it is enough to compare it with API.
Note: API (application programming interface) is a set of rules that enables an interaction of a system with users. While a protocol is a set of rules that enables an interaction of a system with its own components. E.g. a user makes a request for sending money, API passes it to the system which with the help of a cryptographic protocol assembles the whole transaction from a number of components and fulfills the transferring function. Voi La, the funds are sent.
Bitcoin as a technology
The Bitcoin underlying technology is called a block chain, an ever-growing chain of blocks. This term stands for a distributed database or public asset ledger which consists of blocks with transactions. Each node of the network has a copy of this database.
To transfer funds the sender needs to sign a message with 1. The transaction amount 2. Receiver info via his / her cryptographic private key. After that the transaction will be broadcasted to the Bitcoin Network and then included into the public ledger. Using web-based service Block Explorer anyone can check real-time and historical data about the bitcoin transactions without the need to download the software.
The blockchain technology is claimed to be a breakthrough as it opens doors to new applications related to value transferring. Smart Contracts is just one example of such application.
For example, while Bitcoin has nearly doubled in value over the last year, reaching a price of over $18,000 in November 2020, it’s also drastically lost value in the same year, like when it bottomed out at under $5,000 per Bitcoin. Even Bitcoin’s recent highs, however, are still lower than its 2017 peak of about $20,000 per Bitcoin. All of this is to say, cryptocurrencies, unlike most established currencies, can be very volatile and change value frequently.tether coin kupit bitcoin erc20 ethereum обвал ethereum
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Ethereum has an unusually long list of founders. Anthony Di Iorio wrote: 'Ethereum was founded by Vitalik Buterin, Myself, Charles Hoskinson, Mihai Alisie %trump2% Amir Chetrit (the initial 5) in December 2013. Joseph Lubin, Gavin Wood, %trump2% Jeffrey Wilcke were added in early 2014 as founders.' Formal development of the software began in early 2014 through a Swiss company, Ethereum Switzerland GmbH (EthSuisse). The basic idea of putting executable smart contracts in the blockchain needed to be specified before the software could be implemented. This work was done by Gavin Wood, then the chief technology officer, in the Ethereum Yellow Paper that specified the Ethereum Virtual Machine. Subsequently, a Swiss non-profit foundation, the Ethereum Foundation (Stiftung Ethereum), was created as well. Development was funded by an online public crowdsale from July to August 2014, with the participants buying the Ethereum value token (Ether) with another digital currency, Bitcoin. While there was early praise for the technical innovations of Ethereum, questions were also raised about its security and scalability.Ethereumrigname ethereum bitcoin novosti tether транскрипция 999 bitcoin bitcoin мошенники bitcoin автосерфинг bitcoin приложение
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