What is Cryptocurrency Mining ?

What is Blockchain ?

What is Bitcoin ?

What Is Cryptocurrency Mining?

Before reading about what is Cryptocurrency Mining, let us first understand what Cryptocurrency is. In the later section of the essay we will see:

• How does Cryptocurrency Work?
• What is Cryptocurrency mining?
• What are the requirements to mine a cryptocurrency?
• Conclusion

What Is Cryptocurrency?

A cryptographic money, which can be considered as another name of cryptocurrency, is a computerized type of cash that is being utilized progressively everywhere throughout the world. When we compare any of the cryptocurrencies with the fiat money i.e. cash, the digital money is much more productive as far as utilization and exchange costs are considered.

What is Blockchain Technology? And who is Satoshi Nakamoto?

Cryptocurrency uses the technology of blockchain, where miners solve certain mathematical equations to generate coins. These maths equations are codes which need to be mined using several huge computers and software. The first digital money which was exchanged in the whole world was “Bitcoin” which happened in the year 2009. This was done by an anonymous person named Satoshi Nakamoto. The blockchain is a technology which is helpful in maintaining open records or blocks between seller and buyer of cryptocurrency.

Technically each record has a HASH pointer to link last connected block or record, a Time Stamp and transaction data. Nature of this data is

• permanent,
• irreversible and
• it is verified by the miners.

Once the record of any information is added to this open ledger it is difficult to alter it due to complex nature and verification protocol of blockchain.

Global Revolution:

These digital currencies are the money of the future. With the release of Bitcoin started a new era of money-revolution in the whole world. It was the time since when we have seen various virtual currencies being made with new calculations with longer or shorter blockchains to better suit a future economy. Among the presently available cryptocurrencies globally there are 2 prominent protocols on which they have their base, which are: Proof of work (i.e. POW) and Proof of stake.

As we are now clear with what cryptocurrency is, let us now try to bring an understanding regarding the working of Cryptocurrencies.

How does Cryptocurrency Work?

We have already seen what cryptocurrency is and we have also understood that it runs on the technology of blockchain. Let us now understand what exactly a Blockchain is.

• It is such a document which is a ledger having a shared nature.

• This document is utilized multiple numbers of times on the whole network of computers.
• This document is updated each time and is then distributed for the purpose of making it available amongst the whole family of crypto-currency holders.

Each time a transaction related to cryptocurrency comes into effect it is recorded on the blockchain. However, for recording these transactions high power computers are required by the miners who are responsible for tallying each transaction that took place. Further, they are also responsible for authenticating each of these exchanges initiated between the two parties. This is how the safety, security and authenticity of cryptocurrencies are maintained.

These miners in return for their hard work are rewarded by the cryptocoins and not the fiat money. If we talk about the worth of the cryptocurrencies it is not fixed, rather it keeps fluctuating based on the supply of the cryptos and their demand. The value totally depends on an agreed value between the buyer and the seller. This value is considered fair and is in accordance with a similar trading which took place elsewhere.

As the whole network is operated between peers, i.e. it is a peer-to-peer there isn’t any intermediary responsible to keep a check on the transaction. Also, the fees related to such supervision are also saved. The identity of the peers who initiate the transaction is not revealed. All these transactions which take place in this network are available on the public platform, as blockchain is an open network. There are two major ways by which cryptocurrencies can be transacted:

• Trading of traditional currency
• Online exchange

Let us understand this exchange through an example:

Suppose there is a person “A” who wishes to purchase something worth $20,000. And there is a seller “B” who accepts payment in digital currency, maybe Bitcoin. A would further look up for the existing rate of exchange in the market, let us suppose it to be $2,000 for each currency. The identities of both the parties are kept unknown to each other. Thus, ‘A’ will obtain the address of public bitcoin from the website of ‘B’.

As the payment to be made by ‘A’ is 10 bitcoins he would give the instruction to his bitcoin client for transacting these coins in the wallet of B’s address. A signature would be initiated by ‘A’ through his private key, once the transaction is complete. This private key is known only to the owner of the cryptocurrency. When this exchange would be displayed on the network of Bitcoin, miners would immediately get into action and would verify the transaction in a couple of minutes. B’s Bitcoin wallet would be credited by 10 bitcoins.

Let us now understand what is mining!

What is Cryptocurrency mining?

There are majorly 2 utilities of Mining of Cryptocurrency:

• Adding new coins to the economy
• Verifying the exchange of cryptocurrencies through a secure procedure.

Cryptocurrency mining is a procedure through which the exchange of currencies is verified and new cryptos are added released. The mining process can be initiated by anyone who possesses a PC, other required hardware & software and an internet connection. Mining is a procedure that secures the system, and in the meantime compensates the miners with cryptocoins. To mine digital currency you require mining equipment.

The three fundamental types of mining hardware are

• GPU’s,
• FPGA’s and
• ASIC’s.

First and foremost the digital currency mineworkers, for the most part, depended on CPU/GPU as mining equipment. Latest equipment used these days is ASIC. These are the applications for particular incorporated circuits.

• For working on computers and completing certain transactions miners are rewarded in return.
• For completing the transactions and validating the blocks, these miners receive fees in form of coins.

Valid Batches of transaction clustered, encoded and hashed together are called Blocks. Two blocks are connected by hash and this process for linking one block with another is done for the purpose of

• Authenticating and
• Validating the information.

Blocks are earned and created based on the volume of their daily investment. The transactions which are recently initiated are compiled into the blocks and then these puzzles are resolved by the miners. The miner who is able to crack the target first by adding the next block on the blockchain is rewarded in return for his work. Computers are utilized by each of these miners in order to zero-in-on any value of Hash below the target. The reward given to the miners keeps fluctuating depending upon the difficulty and level of mathematical equations.

With the passage of time mining is now seen as a lucrative option for making money, and thus a lot of organizations, as well as individuals, have started putting money in hardware related to mining. Keeping a close check on the scenario and to remain competitive, individual miners have joined hands together by pooling in their individual resources and have come up with something called open pool.

Several mining pools, which count to almost 80% of the network-hash-rate, are established in China. Bitmain (which is based in Beijing) & Canaan are the 2 companies at present which have been doing superbly in mining hardware of consumer grade.  

What Are The Requirements To Mine A Cryptocurrency?

The following would be the requirements if someone wants to become a miner and start with mining job.

1. A personal computer
2. A fast speed internet connection
3. A fast speed cooling fan as a lot of heat is generated while mining
4. A cool area with a hardware setup.
5. A password protected free private database for keeping the earnings
6. A continuous self-learning habit to grab new tips and techniques
7. A package of software for mining, if possible arrange a free version
8. A mining ASIC chip
9. A membership (for exchanging virtual money into conventional)at currency exchange which should be online
10. A membership at the community of miners, i.e. at mining pool.

Conclusion

If we talk about the currency market, although cryptocurrency is a safe and secure way of making and receiving payments, however, mining of cryptocurrencies is an ultimate gamble. As it involves a high amount of investments as well as high cost of electricity, it is an ultimate thing to be observed if miner would end up making money or losing everything in expenses occurred. Also when you initiate a purchase or an exchange again question making or losing money exists. Cryptocurrency mining is full of risk you may not end up making rewards as someone else may solve the mathematical equation faster than you and may claim all the rewards.  

Thus there are always plus and minus associated with each situation in this life. A thorough comparison of ‘goods’ and ‘bads’ is must before making any final decision. Same theory needs to be applied in case of making a choice to mine or not to mine a cryptocurrency. We, at Coinpedia can only provide you with the facts and figures, but the ultimate choice making decision rests in your hands.

Did you buy or mine bitcoins and other cryptocurrencies? What are your personal thoughts on Cryptocurrency mining? Do you have any other query related to the mining of cryptocurrencies? Do let us know by leaving comments in the ‘comment section’.  

What is Blockchain?

The blockchain is a technology which is helpful in maintaining open records or blocks between seller and buyer of cryptocurrency. Cryptocurrency, as we have already understood in earlier articles is “a cryptographic money which a computerized type of cash that is being utilized progressively everywhere throughout the world. When we compare any of the cryptocurrencies with the fiat money i.e. cash, the digital money is much more productive as far as utilization and exchange costs are considered.”

Let’s understand Blockchain further. Technically each record has a HASH pointer to link last connected block or record, a Time Stamp and transaction data. Nature of this data is

• permanent,
• irreversible and
• it is verified by the miners.

Once the record of any information is added to this open ledger it is difficult to alter it due to complex nature and verification protocol of blockchain.

Computer Machines with high Byzantine fault tolerance are used for blockchain records. It is

• decentralized in nature and
• its design is secure.

When we see the history of the blockchain 1992 Bayer, Haber and Stomata introduced Merkle Trees to improve its design for better efficiency to collect the documents in the record. Officially In 2008 first blockchain was invented and utilized by Satoshi Nakamoto as the tool to support and maintain the records of Bitcoin. Satoshi Nakamoto is the unknown inventor of the first cryptocurrency ever, which is the greatest invention in the financial market. He is the one who initiated the whole cryptocurrency-network.

Blockchain Technology is:

• an open record,
• common record,
• used in various fields like community management, constituency voting, locating food joint information etc.

Therefore we can conclude that it is an open piece of information available for all.

As we are now clear with what is Blockchain, in this essay further we will understand:

• What is the Internal Structuring of Blockchains?

• What Is Block And Block Time?

• What is the role of government and the challenges faced by Blockchain Technology?

• What are the Utilities of Blockchain Technology?

• Are there any negative aspects of Blockchain?

• To Summarize

What is the Internal Structuring of Blockchains?

In terms of technical understanding, structure means per day advancement of blockchain records, as a phenomena participation of miners where numerous supercomputers are always chasing the data. The process of identifying and authenticating the information is carried by professional miners. Blockchains are considered as value-exchange protocol.

If we talk about the features of a blockchain:

• A blockchain is decentralized in nature and
• It is a distributed digital data in the form of ledger.
• This data is used by miners to record transactions through multiple computers so that the record cannot be altered retroactively by the participation of miners or professionals.  
• They are self-authenticated by the virtue of mass collaboration collectively driven by self-interests.

As a result of huge participation robust workflow brings uncertainty regarding data security, which is marginal and participants are competing for it. This process ultimately helps in keeping a check that any unit once used may not be double spent.

• Blockchain technology should be used in exchanges, as professional information can be completed more safely and quickly.
• A blockchain can transfer and assign rights or title because of its nature and its format which value offer and acceptance.
• This entire process allows the participants to audit and verify transactions in Blockchain database autonomously used by parallel networks and it is distributed among time stamping servers.

Let Us Now Understand What Is Block And Block Time?

Valid Batches of transaction clustered, encoded and hashed together are called Blocks. Two blocks are connected by hash and this process for linking one block with another is done for the purpose of

• authenticating and
• validating the information.

Blocks are earned and created based on the volume of their daily investment.

These blocks are proof of work which is carried at blockchain at different professional levels that too at the parallel node. Sometimes, this high-end computation creates blocks every second depending on the blockchain you are working on. For example, Bitcoin has block time of 15 minutes whereas block time of Dash is 30 to 40 seconds.    

As we have till now observed the meaning of blockchain, its structure and block & block time, it’s now time to understand the role of government in this entire game of cryptocurrency.

What is the role of government and the challenges faced by Blockchain Technology?

As reflected by professional nature blockchain technology is

• Open,
• Decentralized
• No permission is required to work in it.
• A huge immutable spreadsheet which cannot be hacked.

However, there are challenges and threats which occur time to time within the present environment.

Challenge 1: Government Guidelines

Role of government guidelines related to finance industry is the biggest challenge faced by the blockchain revolution. Now-a-days that way government machinery and private organizations are in favor of an open distributed public account system which can also be called blockchain technology. Blockchain revolution is emerging and bringing the security to the financial environment of the society.

Challenge 2: High electricity Consumption

Another challenge is energy consumption of the special supercomputers involved in the computation. This high energy consumption incurs the high cost of electricity therefore as a solution huge data center are created at places where the cost of electricity is low and

• it is available in abundance and nonstop.
• “proof of work” mechanism is used by bitcoin and etherium blockchain technologies.
• Rather now-a-days Etheruim technology is following the concept of “proof of stake” mechanism.

These challenges are part of the blockchain technology and depending upon the financial strength of the country masses can be benefitted through positive use of this technology. Based on the positive intention this challenge can be worked out very easily once government and private bodies are gathered at the same platform.

Challenge 3: Initial setup and hardware cost

The cost involved in the initial setup and installing the hardware is huge. If in a real sense any organization invests in the blockchain, then profits can only be enjoyed in long term. But remember other challenges are also there and cannot be ignored as they are also interlinked.

Challenge 4: Legal integration of the blockchain with government authority or by law of land.

If legal acceptance of the blockchain system is supported by law and regulations should be drafted hand to hand.

• A generous and positive attitude towards its establishment in the county brings more trust and authenticity among countrymen and at global platform too.
• This challenge is conceptually and technically faced by every economy depending on their internal tear and wear.
• Every country has different perspective to handle this technology in its own way.

Challenge 5: Public perception and participation

The participation of the public is again a huge challenge because somehow actions or policy formation of the government are the replicas of public demand and supply.

• Government regulations depend upon the direction of mass investment in crypto forms of currencies.
• Its legality or illegality is judged on all allied parameters when synchronized with people acceptance and it should go through 360 degrees by law of land.
• Rather really or on actual grounds, it is handled very differently worldwide.

Challenge 6: Privacy and secrecy

Keeping things secret and maintaining the privacy is another challenge faced due to open nature of blockchains.

• Technology is improving that way, but still,
• you should be an honest taxpayer to hold cryptocurrency if it is legal in your country.

Challenge 7: General Behavior of government and policies

Policies and behavior of the government both are entirely different phenomena to go side by side.

• Actually because of complex nature of any economy and
• its functional challenges are different from country to country and from economy to economy.

What are the Utilities of Blockchain Technology?

As the whole world is moving towards the technological up-gradation, there are several uses and importance of this technology.

• Very interestingly, in India, the government is keen to use blockchain technology to maintain the records of land so that issue of its duplicate sales can be worked out. That way government has taken the considerable measures to control the same.
• Banks can be run on this technology provided more established systems are required to share information of accounts at the open platform and insecure manner.
• Acceptance of cryptocurrency by different industries like Music, Films, finance, banking, and automobile etc. makes blockchain technology favorite among different segments of society.

Are there any negative aspects of Blockchain?

Yes, any technology, if not used with a positive mindset, can definitely be used for wrong purposes.

• Generally, people do not have guts to speak about it.
• The big social challenge is involvement of illegal that means terrorist activities.
• If such illegal elements use this technology negatively it can really create havoc.

Therefore, most of the time governments are busy in making regulation related to entire blockchain phenomena. Every economy and its operational country have different challenges to implement this technology in a positive way. Negative issues and challenges occur from time to time which can be resolved according to the need of time.   

To Summarize

Therefore, when we conclude closely we will find that every economy, people, law have the different point of views to accept any technology available around. Definitely, blockchain technology is a great innovation provided understood and taken positively worldwide. It has challenges to work upon but at the end of the day, it has protected the human mental peace.

As already I have mentioned that intention at the back of any invention or technology always decides how it is used. Actually when we overall conclude the best part of blockchain technology is its transparency. All above-mentioned challenges if taken care can become bliss also for any country or its economy if they behave positively towards the challenges.

Every land and its laws have its own issues to work upon, only with the help of positive legislation and regulations these challenges can be worked out. Blockchain technology can be adopted three sixty degrees in all industries, in every economy, among people if legally adopted by government legislation behind it.

In the current scenario, in reality, everyone has craze towards it, maybe it is “legal” or “illegal” but people are showing a keen interest in cryptocurrencies and blockchain technology.

Let us see and we wish good luck to this invention as we hope to listen to something positive by the government of India in nearby future!

What Is Bitcoin

What Is Bitcoin? May Be You Have Heard About It!

Do you know what Bitcoin is and that the craze associated with the word Bitcoin initiated in 2008? The unique thing about the technology of this currency is its distributed electronic money framework. The best thing about Bitcoin is that its acceptance in the markets brought revolution. Its acceptance worldwide shows that it has significant worth in the market. From another point of view if we look closely Bitcoin can be used as:

• A virtual “cash” and
• Written document too.

Bitcoin price fluctuates on the basis of demand and supply in the market and its daily value is dictated by what somebody will pay for it. Bitcoin is

• An encoded cash,
• It is a type of digital money,
• It is an autonomous currency,
• mysterious in nature and
• Has no central control.

In this essay you would see the following topics and details about them:

• How Is Bitcoin Utilized In Reality?
• How would you get Bitcoin?
• What are the various types of Cryptocurrency?
• What is Bitcoin Mining? And Blockchain Technology?
• What is Bitcoin wallet?
• Conclusion

Let us now understand each of the aspects one by one in detail.

Do You Know How Bitcoin Is Utilized In Reality?

As discussed prior also Bitcoin is viewed as a decentralized form of money. In other words, it can be defined as “a human-generated technical system of clients which control and confirm exchanges through the process of individual and group mining rather than a focal expert”. It is like a virtual bank which is influenced by the pressure of demand and supply during the per day trading volume. Bitcoin works like fiat cash since one party pays and other merchandise or enterprises accepts it.

How would you get Bitcoin?

If you wish to acquire a Bitcoin then there are three ways to get it:

1. The first is to “mine” them.

Mining? What is bitcoin mining? Soon we will explain you Bitcoin mining too.  There is a restricted measure of Bitcoin, i.e. there are a fixed number of coins which would be produced ever. This cryptographic money can be viewed as deflationary which means that less and less will enter into the market over the long duration.

2. The second alternative is to procure them:

You can sell and offer your services or items for bitcoins. There are many clients who pay through bitcoin & people are happy to spend their coins as cost.

3. The third choice is to purchase them:

There are two basic approaches or ways to buy Bitcoin.

• The most common and mainstream technique is to agree to accept an online trade that associates you with a dealer directly. At a mutually settled upon value, bitcoins are traded specifically from whomever you choose to buy through a distributed framework.
• The other choice is to meet physically with a merchant and finish the transaction live. Once the deal is discussed, and then with the help of mining, your coins will land in your Bitcoin “wallet”.

What are the various types of Cryptocurrency?

Let us see now that how many cryptocurrencies exist universally. These digital currencies were produced only after the production of Bitcoin. There are close to 1400 different cryptocurrencies some of which are:

• Bitcoin (BTC),
• Litecoin (LTC),
• Ethereum (ETH),
• Zcash,
• Dash,
• Monero,
• Ripple etc.

Let’s understand them in brief! So let’s begin with Bitcoin!

What is Bitcoin (BTC)?

This computerized item was basically conceptualized at a whitepaper written in 2009 by a pseudonymous essayist named Satoshi Nakamoto. The primary cryptographic money to rise was Bitcoin (BTC), which has its base on the SHA-256 calculation. A solitary Bitcoin can be spent at fragmentary additions that can be as little as 0.00000001 BTC per exchange.

• It works on Blockchain technology.
• Bitcoin is presently the most expensive of all Cryptocurrencies, as it is the most accepted among all available options.
• This essentially implies it could work simply like physical money.
• Bitcoin transactions are irreversible. Once you follow the process and it is finished, nobody can reverse the exchange.
• Bitcoin is distinct to around 8 decimal places and could be broadened further if necessary.
• In the present swapping scale of 100, this is detachability down to $0.0000001 along with Low handling charge.

Following are the other available forms of cryptocurrencies available in the market.

What is Litecoin (LTC)?

Based on a technical difference Litecoin (LTC) makes utilization of the Script encryption calculation, instead of the SHA-256 framework of programming.

• Litecoin is mined on ASIC equipment which is easily mined at a quicker pace.
• Its mining calculations are comparatively simple and easy then BTC mining.
• Its famous attribute is a fast & straightforward Cryptographic calculation utilized to mine it which makes the block mining 4 times speedier.

What is Ethereum (ETH)?

Ethereum (ETH) has a market capitalization of $4.46 billion, which is second after Bitcoin among all digital forms of money. Ether is like a vehicle for moving around on the Ethereum framework and it is looked for by the most engineers trying to create and work programs inside Ethereum. Following the assault on the DAO in 2016, Ethereum was divided into

• Ethereum (ETH) and
• Ethereum Classic (ETC).

It is a popular form of digital currency. Ethereum is a platform to use as a blockchain applications and to mine new tokens.

What is Zcash?

Another decentralized crypto form of currency which works on the basis of confirmation structure created by the zk-SNARK group. Its unique and simple programming technique with wide acceptance in the market makes Zcash to secure the system or verification of development.

What is Dash?

Dash currency operates at comparatively high secrecy programming framework. It was introduced in 2014 and after that, it has its great market acceptance. Dash initially known as Darkcoin is a decentralized master-code framework which makes transactions perfectly untraceable till required.

• This digital currency was first time mined by Evan Duffield.
• It could be mined by gadgets utilizing a CPU or GPU.
• Technically Dash utilizes a two-level design to control its system & it’s Decentralized Autonomous Organization (DAO)

Miscellaneous

When we virtually see there are more than 1400 different types of cryptocurrencies available in the market.

• Swell (XRP) is one used to continuous overall settlement gives certain and minimal effort to make its universal installments. Swell “enables banks to reimburse cross-outskirt installments successfully.
• RIPPLE another crypto form of currency Released in 2012; Ripple money has a market capitalization of $1.26 billion.
• Monero (XMR) is a protected, safe and professionally untraceable form of cryptocurrency. This Open digital money was initiated in April 2014 and has a huge base of investors in it.

What is Bitcoin Mining? And Blockchain Technology?

Bitcoin mining is a procedure that secures the system, and in the meantime compensates the miners with cryptocoins. To mine digital currency you require mining equipment. The three fundamental types of mining hardware are GPU’s, FPGA’s and ASIC’s. First and foremost the digital currency mineworkers, for the most part, depended on CPU/GPU as mining equipment. Latest equipment used these days is ASIC. These are the applications for particular incorporated circuits.

As the reward for mining blocks is so high therefore the competition to win that reward is also at high stake. At any moment numerous of supercomputers all around the world are competing to mine the next Bitcoin. The process by which we confirm the processed payments is called mining. All these transactions are meant to be stored on Blockchain.

You can also become a miner!

• Just by working on computers efficiently anyone can become a Bitcoin miner.
• For working on computers and completing certain transactions they are rewarded in return.
• For completing the transactions and validating the blocks, these miners receive fees in form of coins.
• In some special cases of professional miners, they receive additional rewards too.
• Each miner competes tough in the market and miners excel based on their proficiency and experience of mining they accumulate each day.

As there is a cut-throat competition throughout the world there has been technological adds on in the hardware which is utilized for mining of Bitcoins. In general, anyone who possesses a Computer with Central Processing Unit i.e. CPU can begin to mine, however, these PCs are meant for general purpose and day to day operations. Thus technologically advanced GPU systems are required for faster mining.

Technology used then and now

At the beginning GPUs i.e. the Graphic Cards were used by the miners. Do you know that GPU is a type of computer chip which has aided in the creation of complicated 3-dimensional imaging-algorithms? It is recommended that one should use more than single graphics card in the computer for professional use. Also for faster and efficient mining, a setup of graphics card is recommended. These days following are the features of this graphics card:

• It helps in three-dimensional computer machines,
• It aids in gaming functions,
• It helps in high-end mining.

This has multiple hardware to support mining at killing speed. Definitely, it is an investment-oriented concern depending upon the venture capital of miner or mining pool. Miners generally work alone and in mining groups where sometimes they have shared investments and sometimes assignments are paid.

A lot of large pools are established in China, on which maximum Bitcoin Mining is done. Even though the rewards for mining have decreased from last-years but still it is being continued.

Once we have discussed everything about Bitcoin, its mining technology, miners etc, now it’s time to understand that where do we keep these currencies? Once a client makes a purchase then how and where will the cryptocurrency be stored? Let’s understand!

What is Bitcoin wallet?

In a very easy language, a wallet is much similar to an email account, with the secret key. Your Bitcoin wallet is a place where you can get, send and store your Bitcoins. With the help of secret code or key, you can spend it also. Therefore wallet is a kind of account which helps us to carry out our Bitcoin transactions in the safe and secure way. There are various types of wallets where these currencies can be stored like

• Mobile Wallets,
• Online Wallets,
• Paper Wallets,
• Hardware Wallets and many more.

Conclusion

After getting a thorough understanding of what is Bitcoin we can say that over a period of years now cryptocurrency has craze among people and its growing demand makes it “Talk of the town”. Initially after facing a lot of rejections, now most of the countries are opening their arms to it.

Maybe the process is time taking as more of legal legislative regulations are involved to initiate any kind of cryptocurrency in the country. Even in many countries, it is going without any legal framework also. But investing in cryptocurrency definitely involves high risks due to its volatile nature of the market. Thus an in-depth knowledge of each and every aspect of Bitcoins and other cryptocurrencies is a must. Consider this “conclusion as a disclaimer” too where we are sharing our knowledge and information with the readers.

What Is Bitcoin? May Be You Have Heard About It!

Do you know what Bitcoin is and that the craze associated with the word Bitcoin initiated in 2008? The unique thing about the technology of this currency is its distributed electronic money framework. The best thing about Bitcoin is that its acceptance in the markets brought revolution. Its acceptance worldwide shows that it has significant worth in the market. From another point of view if we look closely Bitcoin can be used as:

• A virtual “cash” and
• Written document too.

Bitcoin price fluctuates on the basis of demand and supply in the market and its daily value is dictated by what somebody will pay for it. Bitcoin is

• An encoded cash,
• It is a type of digital money,
• It is an autonomous currency,
• mysterious in nature and
• Has no central control.

In this essay you would see the following topics and details about them:

• How Is Bitcoin Utilized In Reality?
• How would you get Bitcoin?
• What are the various types of Cryptocurrency?
• What is Bitcoin Mining? And Blockchain Technology?
• What is Bitcoin wallet?
• Conclusion

Let us now understand each of the aspects one by one in detail.

Do You Know How Bitcoin Is Utilized In Reality?

As discussed prior also Bitcoin is viewed as a decentralized form of money. In other words, it can be defined as “a human-generated technical system of clients which control and confirm exchanges through the process of individual and group mining rather than a focal expert”. It is like a virtual bank which is influenced by the pressure of demand and supply during the per day trading volume. Bitcoin works like fiat cash since one party pays and other merchandise or enterprises accepts it.

How would you get Bitcoin?

If you wish to acquire a Bitcoin then there are three ways to get it:

1. The first is to “mine” them.

Mining? What is bitcoin mining? Soon we will explain you Bitcoin mining too.  There is a restricted measure of Bitcoin, i.e. there are a fixed number of coins which would be produced ever. This cryptographic money can be viewed as deflationary which means that less and less will enter into the market over the long duration.

2. The second alternative is to procure them:

You can sell and offer your services or items for bitcoins. There are many clients who pay through bitcoin & people are happy to spend their coins as cost.

3. The third choice is to purchase them:

There are two basic approaches or ways to buy Bitcoin.

• The most common and mainstream technique is to agree to accept an online trade that associates you with a dealer directly. At a mutually settled upon value, bitcoins are traded specifically from whomever you choose to buy through a distributed framework.
• The other choice is to meet physically with a merchant and finish the transaction live. Once the deal is discussed, and then with the help of mining, your coins will land in your Bitcoin “wallet”.

What are the various types of Cryptocurrency?

Let us see now that how many cryptocurrencies exist universally. These digital currencies were produced only after the production of Bitcoin. There are close to 1400 different cryptocurrencies some of which are:

• Bitcoin (BTC),
• Litecoin (LTC),
• Ethereum (ETH),
• Zcash,
• Dash,
• Monero,
• Ripple etc.

Let’s understand them in brief! So let’s begin with Bitcoin!

What is Bitcoin (BTC)?

This computerized item was basically conceptualized at a whitepaper written in 2009 by a pseudonymous essayist named Satoshi Nakamoto. The primary cryptographic money to rise was Bitcoin (BTC), which has its base on the SHA-256 calculation. A solitary Bitcoin can be spent at fragmentary additions that can be as little as 0.00000001 BTC per exchange.

• It works on Blockchain technology.
• Bitcoin is presently the most expensive of all Cryptocurrencies, as it is the most accepted among all available options.
• This essentially implies it could work simply like physical money.
• Bitcoin transactions are irreversible. Once you follow the process and it is finished, nobody can reverse the exchange.
• Bitcoin is distinct to around 8 decimal places and could be broadened further if necessary.
• In the present swapping scale of 100, this is detachability down to $0.0000001 along with Low handling charge.

Following are the other available forms of cryptocurrencies available in the market.

What is Litecoin (LTC)?

Based on a technical difference Litecoin (LTC) makes utilization of the Script encryption calculation, instead of the SHA-256 framework of programming.

• Litecoin is mined on ASIC equipment which is easily mined at a quicker pace.
• Its mining calculations are comparatively simple and easy then BTC mining.
• Its famous attribute is a fast & straightforward Cryptographic calculation utilized to mine it which makes the block mining 4 times speedier.

What is Ethereum (ETH)?

Ethereum (ETH) has a market capitalization of $4.46 billion, which is second after Bitcoin among all digital forms of money. Ether is like a vehicle for moving around on the Ethereum framework and it is looked for by the most engineers trying to create and work programs inside Ethereum. Following the assault on the DAO in 2016, Ethereum was divided into

• Ethereum (ETH) and
• Ethereum Classic (ETC).

It is a popular form of digital currency. Ethereum is a platform to use as a blockchain applications and to mine new tokens.

What is Zcash?

Another decentralized crypto form of currency which works on the basis of confirmation structure created by the zk-SNARK group. Its unique and simple programming technique with wide acceptance in the market makes Zcash to secure the system or verification of development.

What is Dash?

Dash currency operates at comparatively high secrecy programming framework. It was introduced in 2014 and after that, it has its great market acceptance. Dash initially known as Darkcoin is a decentralized master-code framework which makes transactions perfectly untraceable till required.

• This digital currency was first time mined by Evan Duffield.
• It could be mined by gadgets utilizing a CPU or GPU.
• Technically Dash utilizes a two-level design to control its system & it’s Decentralized Autonomous Organization (DAO)

Miscellaneous

When we virtually see there are more than 1400 different types of cryptocurrencies available in the market.

• Swell (XRP) is one used to continuous overall settlement gives certain and minimal effort to make its universal installments. Swell “enables banks to reimburse cross-outskirt installments successfully.
• RIPPLE another crypto form of currency Released in 2012; Ripple money has a market capitalization of $1.26 billion.
• Monero (XMR) is a protected, safe and professionally untraceable form of cryptocurrency. This Open digital money was initiated in April 2014 and has a huge base of investors in it.

What is Bitcoin Mining? And Blockchain Technology?

Bitcoin mining is a procedure that secures the system, and in the meantime compensates the miners with cryptocoins. To mine digital currency you require mining equipment. The three fundamental types of mining hardware are GPU’s, FPGA’s and ASIC’s. First and foremost the digital currency mineworkers, for the most part, depended on CPU/GPU as mining equipment. Latest equipment used these days is ASIC. These are the applications for particular incorporated circuits.

As the reward for mining blocks is so high therefore the competition to win that reward is also at high stake. At any moment numerous of supercomputers all around the world are competing to mine the next Bitcoin. The process by which we confirm the processed payments is called mining. All these transactions are meant to be stored on Blockchain.

You can also become a miner!

• Just by working on computers efficiently anyone can become a Bitcoin miner.
• For working on computers and completing certain transactions they are rewarded in return.
• For completing the transactions and validating the blocks, these miners receive fees in form of coins.
• In some special cases of professional miners, they receive additional rewards too.
• Each miner competes tough in the market and miners excel based on their proficiency and experience of mining they accumulate each day.

As there is a cut-throat competition throughout the world there has been technological adds on in the hardware which is utilized for mining of Bitcoins. In general, anyone who possesses a Computer with Central Processing Unit i.e. CPU can begin to mine, however, these PCs are meant for general purpose and day to day operations. Thus technologically advanced GPU systems are required for faster mining.

Technology used then and now

At the beginning GPUs i.e. the Graphic Cards were used by the miners. Do you know that GPU is a type of computer chip which has aided in the creation of complicated 3-dimensional imaging-algorithms? It is recommended that one should use more than single graphics card in the computer for professional use. Also for faster and efficient mining, a setup of graphics card is recommended. These days following are the features of this graphics card:

• It helps in three-dimensional computer machines,
• It aids in gaming functions,
• It helps in high-end mining.

This has multiple hardware to support mining at killing speed. Definitely, it is an investment-oriented concern depending upon the venture capital of miner or mining pool. Miners generally work alone and in mining groups where sometimes they have shared investments and sometimes assignments are paid.

A lot of large pools are established in China, on which maximum Bitcoin Mining is done. Even though the rewards for mining have decreased from last-years but still it is being continued.

Once we have discussed everything about Bitcoin, its mining technology, miners etc, now it’s time to understand that where do we keep these currencies? Once a client makes a purchase then how and where will the cryptocurrency be stored? Let’s understand!

What is Bitcoin wallet?

In a very easy language, a wallet is much similar to an email account, with the secret key. Your Bitcoin wallet is a place where you can get, send and store your Bitcoins. With the help of secret code or key, you can spend it also. Therefore wallet is a kind of account which helps us to carry out our Bitcoin transactions in the safe and secure way. There are various types of wallets where these currencies can be stored like

• Mobile Wallets,
• Online Wallets,
• Paper Wallets,
• Hardware Wallets and many more.

Conclusion

After getting a thorough understanding of what is Bitcoin we can say that over a period of years now cryptocurrency has craze among people and its growing demand makes it “Talk of the town”. Initially after facing a lot of rejections, now most of the countries are opening their arms to it.

Maybe the process is time taking as more of legal legislative regulations are involved to initiate any kind of cryptocurrency in the country. Even in many countries, it is going without any legal framework also. But investing in cryptocurrency definitely involves high risks due to its volatile nature of the market. Thus an in-depth knowledge of each and every aspect of Bitcoins and other cryptocurrencies is a must. Consider this “conclusion as a disclaimer” too where we are sharing our knowledge and information with the readers.