“Cryptocurrencies” or “Digital Currencies”are the newest currency built using an “open software” program called “blockchain”. “Altcoin” is an abbreviation for: alternative coin and is used to describe any cryptocurrency other than bitcoin.
Open software means the copyright holder provides the rights to study, change, and distribute the software to anyone for any purpose, allowing the software to be developed in a collaborative public manner.
The original developer of blockchain, Satoshi Nakamoto, is apparently a pseudonym, leaving the identity of the creator or creators unknown.
Whoever Satoshi Nakamoto is, this entity or person, “holds roughly 1 million bitcoin, worth approximately $18.6 billion based on recent prices. To add further to the mystery, it seems a minimal amount, if any, of this bitcoin has been moved/spent.”
The reason for the creation of Bitcoin was the desire to create a monetary payment system that does not rely on third parties (like banks or governments) to process electronic payments. Instead it relies on the consensus of the nodes on the network.
“A node is any physical device within a network of other devices that’s able to send, receive, and/or forward information. The computer is the most the common node and is often called the computer node or internet node. Modems, switches, hubs, bridges, servers, and printers and digital wallets are also nodes.”
Features and purposes of different coins vary.
For example, Bitcoin isn’t fully anonymous. The ledger can be viewed by anyone and the flow of funds can be traced to and from different Bitcoin addresses, although there is no private information linking you to your Bitcoin address. Other coins have been developed to provide full anonymity.
For a full list of 40+ cryptocurrencies to date: https://en.wikipedia.org/wiki/List_of_cryptocurrencies
Cryptocurrency is encrypted (hence crypto) blockchain. A block is a record of new transactions. Once each block/transaction is complete it’s added to the chain, creating a chain of blocks called: a blockchain.
There are two locks/ keys on each segment/block of blockchain.
Keys / Locks
- With blockchain, what you have is a private key known only to you (basically just a super long password) to its address on the blockchain.
- Each account also has a public key, which lets other people send cryptocurrency to your account. With this key you can withdraw currency to spend, but if you lose the key there’s no way to get your money back.
Information on the blockchain is also publicly available. It’s decentralized, meaning it doesn’t rely on a single computer or server to function.Transactions are instantly visible to everyone.
In this way, blockchain is compared to a coded ledger that information about each and every transaction is saved, visible and trackable (personal info will be in code no one else can interpret).
As you can image… the more a bitcoin is passed around, the blockchain grows longer and longer, as no part of the code is ever deleted.
Article researched and copy written by Laughing Fox Designs, providing results driven website development and social media actions to start-ups, small businesses and mid-size companies. ©2018 All Rights Reserved
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