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| Explanation Of The Concept Of Applying Blockchain To Bitcoin |
The goal of blockchain is to allow digital information to be recorded and distributed, but not edited. This concept can be difficult now, so let's take a look at how this technology works and applies to Bitcoin .
In fact, blockchain is not recent but it was first appeared in 1991 by Stuart Haber and W. Scott Stornetta, two researchers who wanted to implement a system that could not be tampered with with the traditional document and paper system.
Stuart Haber
But not nearly two decades have passed, and with the launch of Bitcoin in January 2009, this technology had its first actual application in the financial system.
The Bitcoin protocol is built on the blockchain In a research paper on digital currency, Bitcoin's creator Satoshi Nakamoto notes that it is "a completely new peer-to-peer electronic cash system, with no trusted third party."
Blockchain application on Bitcoin
Of all the people around the world who own and deal with Bitcoin, according to a 2017 study from the Cambridge Center for Alternative Finance, the number could be as high as 6 million.
Suppose that one of those 6 million people wants to spend their Bitcoins, whether for shopping and buying, the role of the blockchain, which organizes this relationship, comes in here.
When it comes to printed money, the use of printed currency is regulated and verified by a central authority, usually a bank or government - but Bitcoin is not under anyone's control, instead, transactions made in Bitcoin are verified by a network of devices. Computer.
For example when someone pays to shop with Bitcoin, computers race on the Bitcoin network to verify the transaction. In order to do so, users run a program on their computers and try to solve a complex mathematical problem or Bitcoin mining , which is called "hashing."
When the computer solves the problem by “hashing”, its computational work will also verify the block as a whole. The completed transaction is publicly recorded and stored as a block in the blockchain, at which point it becomes immutable in the case of Bitcoin, and most other chains, computers that are rewarded It successfully verifies blocks on its currency with cryptocurrencies (for a more detailed explanation, see: Is Bitcoin Mining Profitable ?
Although transactions are generally logged on the blockchain, the user data is not or, at least, incomplete. In order to conduct transactions on the Bitcoin network, participants must run a program called a "wallet". Each wallet consists of two unique and distinct cryptographic keys: a public key and a private key.
The public key is the location where transactions are deposited and withdrawn from, this is also the key that appears on the blockchain ledger as the user's digital signature.
A user's public key is a shortened version of the private key, which is generated through a complex mathematical algorithm, however, due to the complexity of this equation, it is almost impossible to reverse the process and create a private key from a public key, for this reason, blockchain technology is very secretive.
Blockchain & Bitcoin
Bitcoin is a digital currency that was created primarily to speed up transactions across countries, to reduce government control, and to simplify the entire process without the presence of third-party intermediaries.
Bitcoin is not considered an officially accepted payment method in many countries, but people around the world use it in various types of transactions, since it is not physically or tangible, it is very safe and secure, and Book Shin is the best way to do these transactions.
A blockchain is a type of ledger that records all transactions and assists with peer-to-peer transactions, it is open, secure and easily accessible for everyone.
Thus the blockchain acts as the Bitcoin ledger and handles all Bitcoin transactions, since then the blockchain has grown from strength to strength and now meets the needs of small transactions across various industries.
Blockchain has made technology adapt to different fields and industries so that technology can be changed according to the high quality standards required by each company.
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