Many people are trying to find out about the various cryptocurrencies. This will demand able to conduct a proper due diligence when it comes to cryptocurrencies. Today however, we will make it easier for you to understand what exactly Bitcoin is and how it works.
Below, we will shed some light on the different aspects of Bitcoin so that you can easily understand how this cryptocurrency works.
Bitcoin is the pioneer cryptocurrency. Cryptocurrency stands for a digital currency which is encrypted in order to protect the users. The currency is traded digitally. When you are holding the currency as well, it is in the digital form.
Bitcoin first originated in January 3, 2009. It was created by Satoshi Nakamoto. This is a pseudonym. The identity of the person behind this name is still not known. The 1st block was mined by him who is also known as the Genesis block. The reward for mining that block was 50 Bitcoins.
The technology behind them:
The underlying technology which is powering Bitcoin is known as the blockchain technology. Blockchain technology consists of multiple nodes. In blockchain technology, whenever a transaction is initiated, the details of the transaction are added to a block. Only when the information in the block is verified, the money is actually sent the recipient. Only after this information is verified, the transaction is concluded.
How do this work?
The blockchain technology verifies the data on the block. The block is sealed and it is encrypted. The information is verified by the stakeholders who are known as the cryptocurrency miners. Cryptocurrency miners have high-profile computers which are used for the verification of such information. Once they are able to verify the information in a single block, the will be able to make one Bitcoin. As the number of transactions increase, the block size is also increasing. Each and every block is mined in a decentralized manner. It can be sent to any cryptocurrency miners anywhere around the world. Since the information is entirely encrypted, even the cryptocurrency miner will not be able to access the information which is being verified in their machine.
The next time around, you hear about Bitcoin, you will be able to easily understand what exactly is. As a result, it will indeed become easier for you to also find out whether it is worth investing or not. Bitcoin as a cryptocurrency is actually changing the entire world. It is changing the sole idea of money which is why, it is so powerful.