Recently, Bitcoin has become a hot topic in mainstream discussion. Since it broke through $4,000 on August 12, the price of Bitcoin has reached an unprecedented high. According to CoinDesk Bitcoin Price Index, the price of Bitcoin has risen by more than 300% so far this year, and the total market value has soared by more than 500%. Although the upward trend of Bitcoin may change at any time, it has won many auras for this cryptocurrency. What exactly is Bitcoin? What are the characteristics of Bitcoin? concept The concept of BitCoin was first put forward by Satoshi Nakamoto in 2009. According to Satoshi Nakamoto’s ideas, open source software and P2P network were designed and released. Bitcoin is a P2P digital cryptocurrency with a total amount of 21 million. It can be simply understood that Bitcoin is a string of numbers with cash value. Peer-to-peer transmission means a decentralized payment system, which is as decentralized, global and anonymous as the Internet.
Function Bitcoin can be cashed and converted into the currencies of most countries. Users can use bitcoin to buy some virtual items, such as clothes, hats and equipment in online games. As long as someone accepts it, they can also use bitcoin to buy real-life items. Transferring bitcoin to the other side of the globe has no restrictions and low cost, and can be used in cross-border transactions, payments, remittances and other fields.
The essence of bitcoin is actually a special solution generated by a bunch of complex algorithms. A special solution refers to a group of infinite (in fact, bitcoin is a finite) solutions that can be obtained by a system of equations. And each special solution can solve the equation and is unique. For example, bitcoin is the serial number of RMB. If you know the serial number on a banknote, you will have this banknote. The process of mining is to constantly seek the special solution of this equation group through huge calculation. This equation group is designed to have only 21 million special solutions, so the upper limit of Bitcoin is 21 million.
To mine bitcoin, you can install a bitcoin client on your computer, produce bitcoin with your own computer, and be a "miner". After completing the installation of the bitcoin client, you can directly obtain a bitcoin address. When trading, you only need to post the address to others yourself, and you can make payment through the same client. After installing the Bitcoin client, it will assign a private key and a public key. It is necessary to back up the wallet data containing the private key to ensure that the property is not lost.
How to earn bitcoin? Bitcoin does not have a centralized issuer, but is generated by the calculation of network nodes. Anyone can participate in the manufacture of Bitcoin, and it can be circulated all over the world. It can be bought and sold on any computer connected to the Internet. No matter where you are, anyone can mine, buy, sell or collect Bitcoin, and foreigners can’t identify the user identity information during the transaction. Generally, you can earn bitcoin by working as a miner, buying bitcoin dug by miners with money, opening an online store to sell things and collecting bitcoin, and speculating in bitcoin at the exchange.
The operation of bitcoinBitcoin is actually a decentralized ledger on the Internet. Bitcoin users run bitcoin client software on a computer, which is called a node. A large number of node computers are connected with each other to form a P2P network like a spider web. For example, Li wants to transfer Zhang’s B account 3 bitcoin through A account.
The decentralized public account book of Bitcoin is called blockchain, which is the underlying application of Bitcoin, providing open and unchangeable underlying data services. Nodes synchronize transactions with the help of blocks, which ensures the unity of data of all nodes. A package of transactions in a period of time is called a block, and each block is linked to the previous block, starting from the founding block and connecting to the current block, forming a blockchain. Blockchain is essentially a decentralized database. Blockchain is a series of data blocks associated by cryptography. Each data block contains the information of a bitcoin online transaction, which is used to verify the validity of its information and generate the next block.
Bitcoin characteristics
1. Decentralization, the whole network is composed of users and there is no central bank. 2. Worldwide circulation, borderless: Bitcoin can be managed on any computer connected to the Internet. No matter where you are, anyone can mine, buy, sell or collect bitcoin. 3. Exclusive ownership: A private key is required to control Bitcoin, and no one can obtain it except the user himself. 4. Convenient transaction: no supervision, no hidden cost, using bitcoin to trade, knowing the other party’s bitcoin address can make payment, without limit and formalities, without going through any regulatory agencies, and without leaving any transaction records. 5. Anonymity, the storage account is completely anonymous after purchase, and no one knows it. 6. Price fluctuation: A large number of speculators intervened, which led to the fluctuation of bitcoin exchange cash price. 7. There are gray areas that may be used for illegal activities. 8. Vulnerability of the trading platform. The trading platform is usually a website with trading function, which will be attacked by hackers. Bitcoin does not depend on any financial institution to operate, and users need to take full responsibility for the security of their own funds.
Source: private placement, comprehensive consolidation
Reference: Internet, Sina Finance, etc