What , Why and How Bitcoin Work?


In an age when the Internet spread and revolutionized all aspects of life, electronic banks and financial movements that began to spread on the Internet and had a significant impact on the financial situation in the real world followed the revolution. Online Financial Transactions. until the morning of January 3, 2009, when a new currency yet established by BITCOIN

For those who do not know BITCOIN is a pseudo-encrypted virtual currency known as “Satoshi Nakamoto”, and is somewhat similar to the known currencies of the dollar, euro, and other currencies, but they differ in that they are fake, The transactions are online and have no physical presence, and encrypted, i.e. cannot track the sales and purchase carried out or even knowledge of the currency, and to simplify the mechanism of work of this currency Let us take a simple example

How does BITCOIN WORK?

BITCOIN

 

Imagine that there is a room with surveillance cameras watching every small and large and recorded for life, and in this room five transparent shops so that the coins can be seen inside clearly, and each of the proceeds of the five owned by someone standing outside the room with a code to open the proceeds, and this The person wants to buy something, so he goes to the dealer and gives the trader the code of the proceeds, then the dealer enters the room and his face is covered so that he cannot be seen and take the money and put it in his possession in the same room and come out, so these cameras have recorded that it was The transfer of a sum of money, but do not know the proceeds of gold or money to or from lost in Thing

 However, why BITCOIN

Everything has its pros and cons, and the pros of this currency are summarized in three sentences

Low fees and speed

Instead of the need for an intermediary between you and the trader to transfer money, this broker deducts a percentage of the money, with the existence of BITCOIN currency, this process does not exist, because the currency did not move, but the currency code is extracted from your portfolio and entered into the merchant’s wallet, The process is done between you and the merchant without an intermediary and is called P2P or peer to peer

Confidentiality

Buying and selling cannot monitor or interfere with. This is a positive point for those who like privacy and it reduces the control of the government and banks on the currency

Global

It is not linked to a specific geographical location can be treated as a local currency.

And the most important thing in this currency is that it has no (officer or link) that the expression and this cancels the control of the central banks on the printing of money, which caused inflation and high prices, and the reason that makes this currency protected from inflation is limited number has put Satoshi Nakamoto plan With 21 million coins to be produced by 2140, and their limited number gave them a great value in the market, from a mere six cents to more than $ 1,000 and then to about $ 600. The big sudden changes are that they are unstable after, you can track their price on the coin desk website

However, where do people get the BITCOIN CURRENCY?

People get it in several ways, but the main way is the mining process

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Two images

The process of mining is similar to the process of extracting gold mining in mines either individually or in groups, but in the process of mining BITCOIN, replace the drilling tools with computers and the more processing capacity, the ability to extract coins faster, Gold is a program to solve complex equations that carry currency codes. Those who find the currency code become their currency. There are many around the world that became obsessed with this currency and book full servers operating throughout the day to solve equations and extract coins

Here is a comprehensive article on TechCrunch on the process of extracting or mining BITCOIN

Although this currency is a fake, some companies such as Titan Bitcoin are working to get this currency into reality in the form of coins of the same value and carry ID of 8 digits, but this loses its most important features are confidentiality and speed and low fees

The disadvantages of this BITCOIN lie in some of its most important features

The first of its disadvantages is the confidentiality of the currency and encryption, as this is an advantage, but it is reflected in some of the disadvantages in that it gives some easy to suspicious operations on the Internet, especially in the deep network and the best example is the site of silk road, which was traded drugs, but must bear in mind that this The site was at the beginning of the life of the currency and its closure did not pose a significant risk to the currency, but it remains a problem

And for those who do not know the deep network and what you can see this video

The second is doubts about the mining process. No one knows what equations the machine is solving. Some have questioned the existence of an organization that works in secret to solve equations that may need hundreds of years in a short time to divide equations on servers

And the third is in the identity of Satoshi Nakamoto unknown, no one knows if a man or a woman or a group of people, and do not know how much this figure of currencies if a country hiding behind this figure and the largest share of it will cause the change in power centers on the map .

It is also worth mentioning that not all economists and experts stand in the ranks of this currency, some have fears that it is just a bubble and will explode and economic crises with it

In the end, the reason for my writing for this article is not to publicize the currency or the stimulus to buy it, but rather to warn against it strongly or ignore it strongly

In light of the economic inflation that is taking place in the world due to the excessive printing of paper money, it has caused the economic collapse to be a matter of no more time, so this coin may be the last resort for the future. All I hope is that the Arabs begin to pay attention to this problem and prepare for it. Our children and we suffer the trouble of ignoring this, and not necessarily in this currency

Do you think this currency is good for the world and will be a competitor to gold

The BITCOIN currency can consider the future of the new currencies that have recently come into the arena, which has made us ask whether we are really considering another alternative economic currency, or can we consider it a way to make money? In fact, the answer is yes, it has several reasons and more to gain this fame

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But this does not mean you do not know everything about it before you deal with it. You have to ask where you came from, how you deal with it, what exactly to do, in fact, you can buy what you love. Do you want ice cream candy? Want to buy a concert ticket? If they serve you then, but they are not like other currencies, you cannot touch them and put them in your bank account in front of you, because they are in short a digital currency intangible, so some consider them a fake currency, so you always pay attention to your currencies and protection, Manufactured? This done by a very complex calculation called “mining

What is Bitcoin

BITCOIN

Is a digital currency created by a developer who is still anonymous to today and calls itself the Satoshi Nakamoto alias in 2008, in order to provide a viable financial alternative to the current financial infrastructure, where you can spend it for purchase by algorithms and technical calculations called smooth Blocks blockchain

In terms of protection, it has two keys, a public first key known to all, and a user-only key so that no currency can spend without knowing the private key

What is the method of buying BITCOIN

You cannot get this currency as you usually do with your money via ATM, so we will give you the steps today to put your hand on this currency

Make sure the platform or person you buy the currency from is selling you legally, as you usually do when you buy from the Internet

Use a reliable exchange platform such as Gemini to buy, where you must register all your information, and then deposit your own if it is in dollars or genetic sterling or other, then buy Bitcoin at the current exchange rate.

You can also sell Bitcoin in the same way as before.

Transfer your currencies as soon as you buy to another location so that they are safe, do not store them long on the exchange site

So the question here: how will we store it

As we said at the time of purchase, do not keep coins in the site, immediately put them in a safe place, because the platform is to make a safe purchase, and ends its role here, the rest of you, you should not keep your currencies because it will not be under your control

You can use a digital wallet such as Bitcoin-QT to store and secure your currencies on your computer. The wallet will be encrypted and backed up to stay safe. You will also need a permanent virus check and a good understanding of online protection

Alternatively, you can experience an online portfolio such as available on a blockchain, do not worry things may be confusing but when you fully understand the mechanism of action the process will be very easy for you

However, if you do not like or are not comfortable with the previous methods, you can use your paper wallet to send your coins to the offline BITCOIN address in any exchange program like the previous one, where your coins will be spent using your own key

How currencies protected?

This is exactly the case when you protect your bank account. The more you protect it, the less likely you are to reach it. So when you are asked for a password, use a word that you remember immediately but it is strong and unique, be sure to vary between lower and upper case letters and numbers. Using passwords you have used elsewhere, in order for your currencies to remain secure if that sites compromised

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You can also use the “Binary authentication” next to the password. After entering your password, another interface will be displayed asking you to enter the code that sent to your smartphone now, which takes 20-30 seconds to arrive and then enter it to finally login to your account. Has supported by a powerful additional security feature

How is BITCOIN MINING?

Very fast and very powerful special devices that are used for giant and complex programs create them, not at all by our computers. Without these devices, you cannot create digital currencies at all, so your digital currencies cannot verify

Where you have two options to mine, either by buying these devices which are very expensive too or instead you can mining online by using a specific cloud mining service such as Genesis Mining or Ambit Mining Farm which allows BITCOIN mining without maintenance or equipment problems

The original Bitcoin and Bitcoin Cash Bitcoin Cash or BCH

Since the release of Bitcoin every day, the pressure on its block bins has doubled, leading to slower verification of transactions, which increases the conversion fee to form the initial DAT transaction verified by the two metals? The mass size of 1 MB, or 1000 bytes identified in 2010, will often cause slow processing times, which limits the currency’s potential and does not make it different from the normal transfer of funds. The Pitcairn every day is gaining a great popularity, it is thousands who have known BITCOIN in the early years, now the popularity of Bitcoin has reached an unimaginable level and 1 MB in mass transactions will never be valid for the popularity of BITCOIN.

The block size limit added in the BITCOIN code in order to prevent spam attacks on the network at a time when the BITCOIN value was low. By 2015, the value of the Bitcoin had increased significantly and the average size of the block was 600 bytes, creating a scenario that the transaction times would take delays as the number of blocks reached maximum capacity and thus the transaction would check in a short time

Over the years, Pitcairn has developed a number of proposals to process transactions, often based on increasing the size of the mass. Because a central authority does not manage the Bitcoin code, changes to the code require the purchase of all the distributed bonds for the developer from developers and miners. This consensus-based approach could lead to long overdue proposals. This led to the creation of separate groups to account for the bauxite using new standards, called fork. Many of the forks, such as Bitcoin XT and Bitcoin Unlimited, these two divisions or forks failed to get the approval of the masses significantly. Nevertheless, the BITCOIN Cash Bitcoin Cash or BCH split in the new was highly appreciated by a large number of metals

 

 

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