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This article introduces the knowledge of "how to understand Bitcoin and blockchain". Many people will encounter this dilemma in the operation of practical cases, so let the editor lead you to learn how to deal with these situations. I hope you can read it carefully and be able to achieve something!

What is Bitcoin?

Before we begin, let me briefly introduce the history of currency transactions.

History of currency transactions

In currency transactions or anything of value, people have always relied on banks and other trusted third parties, such as banks and governments, to ensure trust and certainty.

These trusted parties now play an important role in promoting digital transactions. This gives rise to the so-called double expenditure problem.

But what if there is a way to remove the flow of digital assets? So, today there is a technology that makes this possible.

In 2009, Satoshi Nakamoto designed a peer-to-peer electronic cash system called Bitcoin, which can transfer online payments directly without a middleman.

What is a blockchain?

A chunk chain is simply a data structure in which each block is linked to another block in time-stamped order.

It is a distributed digital ledger with immutable public records of digital transactions.

Each new record is validated in a distributed network before it is stored in a block.

All information stored in the ledger is verifiable and auditable, but not editable.

Each block is identified by its encrypted signature.

The first block in the chain of blocks is called the Genesis block.

How to implement blockchain in Bitcoin

Blockchain is the basic technology of Bitcoin and can overcome all the problems of traditional banking. Let's take a closer look.

1. Distributed public ledger

Everyone on the Internet has a ledger. There is no single centralized original copy. The ledger here refers to copies of all transactions that have occurred.

Blockchain is a distributed database that stores all bitcoin transactions that have taken place in bitcoin history. This ensures that no one can make changes to the ledger because everyone else marks it as corrupted immediately.

two。 Hash encryption

Everything stored on the block chain is encrypted. In this way, everyone can see all the transactions, but at the same time, no one will know which accounts belong to you.

Isn't that what we expect from the banking system?

3. Proof of workload

Workload proof is a concept invented in the Bitcoin blockchain, in which miners (special users of Bitcoin) will validate transactions by solving complex mathematical problems called workload proof.

Technically, there is a hash target value assigned to each block before time. Miners aggregate a set of unverified bitcoin transactions (about 250) into a block, calculate their hashes, and then compete to find a specific set of characters called Nonce.

The total hash obtained from the hash, transaction data, and random numbers of the previous block must match the final pre-allocated target hash. This Nonce requires a lot of computation. Only people with huge computing power and power can solve it in an average of 10 minutes.

4. Validated incentives

The most interesting part of Bitcoin is Bitcoin mining. This is the concept that some users complete a job and receive a 12.5 bitcoin (BTC) reward per block. Each block takes an average of 10 minutes to mine.

This incentive is used for computing work and covers the power and infrastructure costs required to achieve the calculation. Currently, large pools control 10-20% of global mining capacity, and are usually the only ones that can successfully mine bitcoin.

Bitcoin mining

Bitcoin mining is the process of validating a transaction to a new block and adding that block to an existing block chain. Successful Bitcoin miners have acquired a fixed number of new bitcoins, which are mined into the bitcoin economy. Currently, each successful miner gets 12.5 BTC (which may be replaced every four years or through bitcoin community decisions) as a reward for successfully adding a transaction to the blockchain.

Encrypted currency wallet

Bitcoin wallets are often used to transfer bitcoin between different accounts. These are like supersets of wallets that contain Bitcoin and all other cryptocurrencies such as ethernet, Litecoin,Dash,Ripple and Auroracoin.

All transactions on the Bitcoin network are conducted through one of various Bitcoin wallets. Some popular bitcoin wallets include Jaxx,Zebpay,Blockchain.info,Electrum,Keep Eye,Exodus and Mycelium.

Types of blockchain wallets

We will explore the most popular blockchain wallet types based on private keys, devices and customer locations.

Hot wallet

Hot Wallets is the easiest to use to transfer cryptocurrencies. Instead of downloading the entire blockchain, all private keys are stored online for fast transmission. Compared with cold wallets, they are less reliable.

Cold wallet

Cold Wallet downloads the entire blockchain on the system and each transaction is signed offline and posted online. They are the safest way to transfer encrypted currencies online.

Online wallet

Online online wallets are popular wallets in which block chains exist online and users transfer them using their private keys and the recipient's public address.

mobile wallet

Mobile wallets are similar to online wallets. They are designed for mobile phones. Usually, mobile wallets also have their own online version.

Desktop wallet

Desktop wallets are cold wallets where the private keys of Blockchain accounts, such as Bitcoin and Ethernet Fang, are stored on cold servers, and a separate client computer acts as an intermediary between the Internet and the server.

Physical wallet

A physical wallet is a wallet in which bitcoin (or other cryptocurrency) details (such as private keys, public addresses, and QR codes) are physically stored for long-term use.

Bitcoin client

Bitcoin customers are wallets specific to bitcoin transfers. These customers help users process their bitcoin transactions by charging a small fee. Some of the most popular bitcoin clients are Keep Eye,Electrum,Exodus and Mycelium.

Hardware wallet

Hardware wallets can be used to transfer Bitcoin (cryptocurrency) directly from hardware to another Bitcoin (cryptocurrency) account when Bitcoin is connected to the Internet. In most cases, the wallet itself contains an interface for entering the recipient's details and the amount to be transferred.

Demo-transfer Bitcoin between wallets

Now let's take a look at how to use blockchain wallets to transfer bitcoin to multiple bitcoin accounts. We will use the popular wallet Jaxx for demonstration.

Step 1: download the Jaxx wallet from Jaxx.io

Step 2: create your Bitcoin wallet account on Blockchain.info

Step 3: fill in the details from the Jaxx wallet. The To address can be obtained from your Jaxx wallet under your current Bitcoin address field. Fill in other details, such as bitcoin amount and optional description.

Step 4: confirm that all the details are correct, and then click the "send Bitcoin" button to confirm the transaction.

Step 5: you can now refresh your Jaxx wallet and view the updated bitcoin balance. It takes about 30 minutes for the transaction to be confirmed in three blocks.

That's all for "how to understand Bitcoin and blockchain". Thank you for reading. If you want to know more about the industry, you can follow the website, the editor will output more high-quality practical articles for you!

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