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Basics of Bitcoins for Beginners: How Bitcoin Process Works

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platinumpca
15 diapositives · 249 Views · Apr 13, 2018

Bitcoin is a digital or virtual currency. It is a form of cryptocurrency. As a new user, you can get started with the bitcoin without understanding the technical details.

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Basics of Bitcoins for Beginners: How Bitcoin Process Works
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  1. Basics of Bitcoins for Beginners: How Bitcoin Process Works

  2. Index • Bitcoins for Beginners • How Bitcoin Process Works? 1. Blockchain- Balance 2. Private Keys- Transactions 3. Mining- Processing

  3. Basics of Bitcoins For Beginners

  4. Bitcoins for Beginners • As a new user, you can get started with the bitcoin without understanding the technical details. • Once you installed a bitcoin wallet on your mobile or computer, it will generate your bitcoin address then you can create more whenever you need one.

  5. You can disclose your bitcoin addresses to your friends so that they can pay you or vice versa. • In fact, this is somewhat similar to how email works, except that Bitcoin addresses should only be used once.

  6. How Bitcoin Process Works?

  7. 1. Blockchain - Balance • The blockchain is a shared the public ledge on which the complete bitcoin network relies. • All confirmed transactions are included in the blockchain.

  8. In this way, Bitcoin wallets can calculate their spendable balance, and new transactions can be verified to be spending bitcoins that are owned by the spender. • The integrity and the chronological order of the blockchain are enforced with cryptography.

  9. 2. Private Keys - Transactions • A transaction is a transfer of value between the Bitcoin wallets then gets included in the blockchain. • Bitcoins wallets keep a secret piece of data called a private key which is used to sign transactions, providing a mathematical proof that they have come from the owner wallet.

  10. Also, the signature prevents the transaction from being altered by anybody once it has been issued. • All transactions are broadcast between users and usually begin to be confirmed by the network in the following 10 minutes, through a process called mining.

  11. 3. Mining - Processing • Mining is a distributed consensus system that is used to confirm waiting transactions by adding them in the blockchain. • It enforces a chronological order in the blockchain, protects the neutrality of network and allows various computers to agree on the state of the system.

  12. To be Confirmed, the transaction must be packed in a block that fits strict cryptographic rules that will be verified by the network. • These rules prevent previous blocks from being modified because doing so would invalidate all the following blocks.

  13. Mining creates the equivalent of a competitive lottery that prevents any individual from easily adding new blocks consecutively in the blockchain. • This way, no individuals can control what is included in the blockchain or replace parts of the blockchain to roll back their spends.

  14. Thank You