Curious about Bitcoin, Cryptocurrencies and Blockchain? Here is all the information that you need to get started in the crypto space. Welcome! and enjoy your journey in this revolutionary world of Cryptocurrencies. 

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Sources: http://elements.envato.com/, http://www.freepik.com/, http://en.wikipedia.org/wiki/Bitcoin, http://www.coindesk.com/information/, http://coinmarketcap.com/currencies/bitcoin/

Courtesy of: Bitcoinfy.net

 

What is Blockchain technology? 

A blockchain, originally block chain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a cryptographic hash of the previous block, a timestamp and transaction data. By design, a blockchain is inherently resistant to modification of the data. The idea was engineered by an unknown person or group of people that goes by the pseudonym, Nakamoto Satoshi. The first use case for the blockchain was to securely transfer value over the internet via Bitcoin.

How does Bitcoin work?

Nakamoto Satoshi wanted people to be able to securely transfer money over the internet without the use of a third party like a Bank or a company like PayPal.

“In 2008, a programmer known as Satoshi Nakamoto—a name believed to be an alias—posted a paper outlining Bitcoin’s design to a cryptography e-mail list. Then, in early 2009, he, she, or they released software that can be used to exchange bitcoins using the scheme. That software is now maintained by a volunteer open-source community coordinated by four core developers.” source: MIT technology review

Bitcoin can be sent from user to user on a pee-to-peer Bitcoin network directly. The transactions are verified by network nodes using cryptography and recorded on the blockchain. Bitcoins are also earned on the network through a process know as Mining. Mining is essentially record-keeping service down through the the use of computing power. Miner help to validates the Bitcoin network by grouping all recent transaction in the most recent block and broadcasting it to all the nodes of the network. In order to receive and send bitcoin via the network the user must have a Wallet, which is very similar to a bank account. In complete, all four functions of the Bitcoin network are: the full blockchain, network, miners and wallet.

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Bitcoin Network Node with all four functions: wallet, miner, full blockchain database and network routing. Source: Safari

What are Cryptocurrencies?

Cryptocurrency is a digital asset designed to to work as a medium of exchange that uses cryptography to secure its transactions, to control the creation of additional units, and to verify the transfer of assets. Bitcoin was the first cryptocurrency, but since bitcoin was released by Nakamoto Satoshi in 2009 there has been hundreds more cryptocurrencies to follow, like Ethereum (ETH), Dash, EOS, Litecoin (LTC), Ripple (XRP), Bitcoin Cash (BCH), Ethereum Classic (ETC) and Z Cash (ZEC). Almost all cryptocurrencies use the blockchain technology as their backbone. Some cryptocurrency projects, like Bitcoin Cash, have modified the Bitcoin blockchain protocol to add more functionalities, while others like Ethereum, EOS and Cardano (ADA) have built their own blockchain from scratch to do much more than the Bitcoin blockchain will ever have to offer. Cryptoporridge.com shows a listing of all cryptocurrencies (coins and tokens) as well as live data such as their price, market cap, circulating supply, volume/24 hr and price change/24 hr.

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Courtesy of: Cryptoporridge.com

What is a cryptocurrency  Token?

In the cryptocurrency space, all digital assets created after Bitcoin is regarded as a cryptocurrency, even though not all of the fulfill the criteria to be a currency. Tokens are a representation of a particular asset or utility, that usually resides on top of another blockchain.

What is a cryptocurrency Coin?

A cryptocurrency coin is any asset or utility cryptocurrency that does not reside on another blockchain.

What is a Altcoin?

An Altcoin is any alternative cryptocurrency to Bitcoin. So cryptocurrencies such as Ethereum, Dash, EOS, Cardano, Ripple, Ethereum Classic and Litecoin are all regarded as Altcoins. Most Altcoins are forks of Bitcoin or other cryptocurrencies.

What is a cryptocurrency Hard Fork vs Soft Fork?

A hard Fork (or sometimes hardfork) is a radical change to the protocol that makes previously valid blocks/transactions invalid (or vice-versa). When their is a hard fork all nodes or users are required to upgrade to the latest version. While a soft fork, as it relates to blockchain, is a minor change to the blockchain protocol where the users of the blockchain are not required to upgrade to a new version as all blocks will still be available to the users.

What is cryptocurrency decentralization vs centralization?

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Decentralized System vs  Centralized System. source: Cryptocompare.

 

Cryptocurrency is a digital, virtual or alternative currency that works through a distributed ledger (Blockchain). After the latest block of transactions is produced on the blockchain through verification by Miners, a copy of the entire ledger or record is then distributed to all nodes on the network. As each new copy of the ledger contains also previous transactions, it is almost impossible for any one node holder to change any information on the blockchain. This gives every node holder equal responsibility and power over the blockchain activities and thus making the network decentralized.

A centralized entity is more like a modern Bank or Government where all the information is kept in one location and only a central party has access, control and power over how that information is distributed and used. Almost all cryptocurrencies are decentralized because of the  nature of the blockchain and can be traded on decentralized exchange trading platforms like Binance, Bitsqaure (Bisq), EtherDelta and IDEX.


Featured image source: Pixabay 

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Thanks for reading! you can find more posts from me at Cryptoporridge.com.


 

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