19 Jun 2018 Hristina Ivanova
Bitcoin Spotlight: History, Structure and Investing
Even though nowadays the coin market cap, cryptocurrency conceptions, and virtual money are a very popular topic amongst the general public, the implementation of this technology was done only recently.
Back in early 2009, Satoshi Nakamoto introduced Bitcoin to the world. The Bitcoin network is a next-generation invention, which has empowered an enormous wave of improvements over the years. Millions of IT developers and companies around the globe use the base code of Bitcoin to build upon their own crypto products.
Over the last decade, many have been striving to create a unique altcoin. They are integrating more and more technology improvements, trying to beat other altcoins. The main idea is to provide users with flexible and straightforward digital financial services.
Bitcoin is the first decentralized payment cryptocurrency, which entirely adopts blockchain network technology. This way it introduces the community of users to a public distributed log of transaction data, known as the Bitcoin blockchain. It also creates an entirely peer-to-peer environment where any third-party intervention is prevented.
This is accomplished by the integration of blockchain technology - the core of the functionality of the Bitcoin network. Apart from the primary aim to enable an accessible, profitable, and secure way of executing transactions, the currency has more assets. What's more, those fall into the focus of most investors.
The hashing algorithm used by Bitcoin is the SHA-256, meaning that each block contains the hash of the previous one. Also, the process of mining the cryptocurrency and receiving acceptance from the rest of the network requires the use of the P-o-W system. This proof-of-work introduces an easy way of verifying data for any node but is extremely time-consuming to generate.
As the blockchain network is generated by the community and not by any central bank, it is kept consistent, complete, and unalterable by repeatedly grouping newly broadcast transactions into a block. Those, furthermore are scattered to the network and verified by recipient nodes.
A key topic related to the Bitcoin currency is the so-called mining process or the way of receiving Bitcoins. It defines the record-keeping service done through the use of computer processing power.
Bitcoins are acquired after mining. After receiving coins from any transactions or by the reward system, users can exchange them for other currencies, products, and services. Nowadays it has been estimated by researchers that approximately 3-6 million users have joined the community by holding a wallet of e-cash, most of them using Bitcoin.
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