The Technology used for the Digital Currency
A currency that does not have a mediating institution like governments or banks is completely free.
As a result, a government cannot stimulate its inflation, for example, by “printing” more bills. For this reason, the market itself with its supply and demand law will dictate the dynamics of Bitcoin.The lack of mediation on the part of a financial institution also reduces the values ââfor transactions and speeds up the speed of the procedures.You spend on transport to the bank and in addition to the time spent on transportation Currently online transactions require mediation from financial institutions, with Bitcoin the process will be as simple when buying a product with a banknote in a physical store: Imagine buying a shirt for R $ 50.00 at a physical store: you hand over a ballot with that amount, withdraw your product without the need for a bank to mediate the purchase. Likewise, it is the virtual transaction with cryptocurrency, that’s why it has become more popular; it is cheap and fast because it is P2P.
Bitcoin blockchain and way to use it
Just as a Real note has protection technologies, virtual money must also have it. Real’s new banknotes have holographic stripes, high relief, fluorescent elements, security wire, watermark, puzzle, microprints and a hidden number; it’s a lot of technology to prevent counterfeiting isn’t it!? Likewise, so that virtual money is not cloned, it is protected by a set of principles and techniques called cryptography. Cryptography: it is a set of techniques that aim to encrypt information so that it can only be read by those who know the code, ensuring the security of the information. To make a metaphor, it would be like sending a locked chest to a friend by means of a messenger: he will take the chest to the other person, but he cannot open it, only his friend who has the key will be able to see what is inside. Use bitcoin-up.live for the all kind of the bitcoin trading needs.
Why does Bitcoin use the P2P system?
Bitcoin is an online currency with P2P (peer to peer) payment traffic, meaning that it does not need a central intermediary server. What is the advantage of this? Think of traditional financial transactions In addition, the data related to the transactions are stored until they can be validated by the so-called miners and this process happens in a transparent way: the code is free, so it is possible for anyone to access the information to check its validity. In the digital environment, data can be copied, changed and exchanged. The blockchain was the solution to eliminate the first two characteristics: a person cannot spend 1 BTC twice or say that he sent you 10 BTC but transfer only 0.01 BTC Essentially, the hash takes a large amount of data and turns it into a small amount of information. It is the “fingerprint” of some file, or, in the case of the blockchain, of a block. In this chained block system, this fingerprint is essential.
The hash will sign the contents of the block; if any information is changed, the hash changes. When you generate a new block that also contains the hash of the previous one, it creates a kind of seal: it is possible to check and signal if any block has been altered, to then invalidate it. So P2P (peer to peer) system used in bitcoin make it easy to do transactions. Each blockchain network also has “nodes”, which group participants who have the same interest; in bitcoin, it’s transferring money. These nodes can be either transactional, which write or generate blocks, or miners, who check whether the written block is valid. The computational process required for mining actually involves adding hardware that continually and The blockchain is so secure by a proof of work consensus (PoW) mechanism that uses processing power to solve very complicated mathematical calculations to ensure that the block’s cryptographic hash is valid. When someone solves the operation and manages to validate the block, he receives a reward – the other people in the network can also confirm that the result is correct.
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