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What is Bitcoin

What is Bitcoin

What is Bitcoin

Bitcoin uses peer-to-peer for do not operate with any central authority or with the banks; the management of the transactions and the emission of bitcoin is made collectively by the network. Bitcoin is open-source, its planning is public; no one owns or controls Bitcoin and everyone can take part in the project. Through some of its unique properties, Bitcoin allows exciting uses that could not be covered by any other earlier payment system. It is an electronic money created in 2009 by an anonymous known under the pseudonym Satoshi Nakamoto. Conventionally, the uppercase term Bitcoin refers to the technology and the network, while the lowercase term bitcoin refers to the currency. The Bitcoin network allows the possession and the anonymous transfer of the coins; the information needed to use their bitcoins can be stored on one or more personal computers in the form of digital “portfolio”, or maintained at third parties who perform functions like a bank. In any case, the bitcoin can be transferred over the Internet to anyone who has a “bitcoin address”. The structure peer-to-peer of the Bitcoin network and the lack of a central body makes impossible, for any governmental authority or not, to block the network or seize bitcoin to the legitimate owners or to devalue it by creating a new currency.

What is Bitcoin Miner and Wallet

To understand how the system Bitcoin works, we must start from the understanding of two basic elements: the “miner” and “wallet”. Miner refers to a computer made available to the peer to peer for the operation of check of the adequacy of an operation. Wallet refers to the program that allows you to enter in the Bitcoin network. The portfolio contains addresses and keys to make economic transactions, for example to send money. This is like a personal bank for Bitcoin and can be of different types: it can be installed on your smartphone for small payments with QR Code, for example BitcoinWallet for Android, it can be a web service or can be a software as multibit, which provides full control of the offline wallet, but in this case the backup and security of money are full responsibility of the owner. One of the well-recommended online wallet is xapo. Xapo is one of the best available online bitcoin wallet. It allows you to store your bitcoins and also to get the credit card of the bitcoins to make purchases.

How does Bitcoin work?

A Bitcoin must have a decryption key, which you can get in so-called wallet. The addresses are alphanumeric sequences of length of about 30 characters. Each transaction is stored in a register called “block chain”, useful to check that the whole procedure has been successful and that the value transited has actually been possessed before and deposited then. To be able to spend a Bitcoin is necessary to have a personal key that leads to the address at which you can make a transaction. If someone wants to send or receive a Bitcoin, the key and address have to dovetail. Obviously because there is a purchase need to that the two keys and two addresses are known. The peer-to-peer, at this point, allows the economic transaction and records it. Without simplification of the wallet, which use these complex numbers instead of the user, the network would never be developed. Instead, with the Bitcoin (and especially, considering its value, the smaller units, the satoshis) you can buy an item in a shop focusing on a simple QR Code or order lunch online or make a donation, no particular effort.

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