Connect with us

Global Banking and Finance Review is an online platform offering news, analysis, and opinion on the latest trends, developments, and innovations in the banking and finance industry worldwide. The platform covers a diverse range of topics, including banking, insurance, investment, wealth management, fintech, and regulatory issues. The website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website. .

Finance

Explaining Bitcoin and Blockchain
Explaining Bitcoin and Blockchain

Published : , on

By Danny Scott, CEO at CoinCorner

Bitcoin and Blockchain – I’m sure most people have heard of both over the last few years, but many are still not quite sure what these are.

A little reminiscent of the ‘Internet’, ‘The Cloud’ or even more recently the ‘Internet of Things’, people hear new terms like these and even use them in everyday conversations, but in the background are often quietly confused about what they are or even what they actually do. As with anything new, it can be difficult to break the jargon down and not only explain what it is, but how it’s used in the real world. After 5 years of working in this exciting and fast-paced industry, here are a few key Bitcoin buzzwords worth understanding!

Where does Bitcoin’s story begin?

A little over 9 years ago Bitcoin was launched in a 9-page white paper by Satoshi Nakamoto (a publicly mysterious person or group) as a platform for trustless peer-to-peer transacting. Peer-to-peer simply means that transactions can take place between computers using code, rather than through third-party companies.

 Nakamoto concluded in the white paper that what was being proposed was ‘a peer-to-peer network using proof-of-work to record a public history of transactions that quickly bec[ame] computationally impractical for an attacker to change if honest nodes control[led] a majority of CPU power’. Pretty technical stuff, right?

 Essentially, what Nakamoto did was to very cleverly piece together a variety of concepts and technologies to create what we refer to as Bitcoin. In this article, I’ll highlight the different parts of ‘Bitcoin’ by breaking it down to explain how each piece fits together. These comprise of ‘Digital Currency’, ‘Code’, ‘Nodes’, ‘Miners’, ‘Blockchain’,and the ‘Internet’!

 Digital Currency

At the top level we have ‘bitcoin’, the Digital Currency. This is the part of the puzzle that has an actual value, with today’s price currently sitting at $6,709. At CoinCorner we offer services that enable consumers to buy and sell bitcoin.

 Code

Next up is the Code that actually runs Bitcoin – let’s call this the law. The code is often referred to as the ‘Bitcoin Protocol’. It’s open source which means that anyone in the world with Internet access can see the code and help to develop the protocol. In being set up like this, no single authority or company owns or manages Bitcoin.

 Nodes

Nodes are people like you and me who run software on a computer. This software connects the whole Bitcoin network together and essentially allowing each computer to talk to others in the network. Each node connects to other nodes and enables transactions to be passed around the network.

Miners

A Miner is a computer run by a real person or company, and it’s sole task is to process Bitcoin transactions and confirm them. The mining process involves running a node on a computer which helps the miner to find all of the transactions on the network and ‘mine’ (or simply add them) them into a block on the Blockchain. Miners are rewarded with bitcoin as a thank you for their efforts, which comes from transaction fees paid by the user and as a reward from the ‘code’.

 Blockchain

The blockchain is a database or ledger of all transactions that have been processed (confirmed) on the network by the miners. Bitcoin’s blockchain cannot be edited or deleted, only added to. Nodes around the world will keep a record of the blockchain (all the Bitcoin transactions to ever occur) on their computer. This means that the blockchain is distributed on thousands of computers worldwide – it has no one point of failure which removes the risk of the network going down.

 Internet

This may seem like an obvious one, but all of this couldn’t be completed without the Internet. I feel that this is one under-appreciated piece of the puzzle! The internet facilitates the connection of all of the nodes and the passing of data around.

 Bitcoin in Summary

This is a high-level overview of the different parts that make up Bitcoin, which shows that each part is as important as the next. At present, the Blockchain is being hyped as a revolutionary technology (which it is to an extent), but in reality, it’s actually only one piece of the Bitcoin puzzle and is no more important than the others mentioned here. If you took away any one of the above parts in this current scenario, Bitcoin wouldn’t work or have survived this long.

Uma Rajagopal has been managing the posting of content for multiple platforms since 2021, including Global Banking & Finance Review, Asset Digest, Biz Dispatch, Blockchain Tribune, Business Express, Brands Journal, Companies Digest, Economy Standard, Entrepreneur Tribune, Finance Digest, Fintech Herald, Global Islamic Finance Magazine, International Releases, Online World News, Luxury Adviser, Palmbay Herald, Startup Observer, Technology Dispatch, Trading Herald, and Wealth Tribune. Her role ensures that content is published accurately and efficiently across these diverse publications.

Global Banking & Finance Review

 

Why waste money on news and opinions when you can access them for free?

Take advantage of our newsletter subscription and stay informed on the go!


By submitting this form, you are consenting to receive marketing emails from: . You can revoke your consent to receive emails at any time by using the SafeUnsubscribe® link, found at the bottom of every email. Emails are serviced by Constant Contact

Recent Post