Welcome to Crypto Trading CANADA

ALL YOU NEED TO KNOW ABOUT CRYPTO WORLD

What is BITCOIN and how can I invest

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• ABOUT CRYPTOApr 7, 2022

  Life is all about taking risk

  

  

• ABOUT BITCOIN INVESTMENTApr 7, 2022

  FIRST WHAT IS BITCOIN

  Bitcoin is a digital or virtual currency created in 2009 that uses peer-to-peer technology to facilitate instant payments.

  ..How does it work..

  Fortunately, it’s easier to define what Bitcoin actually is. It’s software and a purely digital phenomenon—a set of protocols and processes.

  It is also the most successful of hundreds of attempts to create virtual money through the use of cryptography. Bitcoin has inspired hundreds of imitators, but it remains the largest cryptocurrency by market capitalization, a distinction it has held throughout its decade-plus history.

  Like standard currency, Bitcoin is produced and has processes and safeguards in place to prevent fraud and ensure appreciation in its value. The main building blocks of Bitcoin are blockchain, mining, hashes, halving, keys, and wallets. They are discussed in detail below.

  (A general note: According to the Bitcoin Foundation, the word “Bitcoin” is capitalized when it refers to the cryptocurrency as an entity, and it is given as “bitcoin” when it refers to a quantity of the currency or the units themselves. Bitcoin is also abbreviated as BTC.1Throughout this article, we will alternate between these usages.)

  

  

  

  

  
  How exactly to categorize Bitcoin is a matter of controversy. Is it a type of currency, a store of value, a payment network, or an asset class?

  Fortunately, it’s easier to define what Bitcoin actually is. It’s software and a purely digital phenomenon—a set of protocols and processes.

  It is also the most successful of hundreds of attempts to create virtual money through the use of cryptography. Bitcoin has inspired hundreds of imitators, but it remains the largest cryptocurrency by market capitalization, a distinction it has held throughout its decade-plus history.

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  Like standard currency, Bitcoin is produced and has processes and safeguards in place to prevent fraud and ensure appreciation in its value. The main building blocks of Bitcoin are blockchain, mining, hashes, halving, keys, and wallets. They are discussed in detail below.

  (A general note: According to the Bitcoin Foundation, the word “Bitcoin” is capitalized when it refers to the cryptocurrency as an entity, and it is given as “bitcoin” when it refers to a quantity of the currency or the units themselves. Bitcoin is also abbreviated as BTC.1Throughout this article, we will alternate between these usages.)

  KEY TAKEAWAYS

  • Bitcoin is a digital currency, a decentralized system that records transactions in a distributed ledger called a blockchain.
  • Bitcoin miners run complex computer rigs to solve complicated puzzles in an effort to confirm groups of transactions called blocks. Upon success, these blocks are added to the blockchain record, and the miners are rewarded with a small number of bitcoins.
  • Other participants in the Bitcoin market can buy or sell tokens through cryptocurrency exchangesor peer-to-peer.

  Mining is intensive, requiring big, expensive rigs and a lot of electricity to power them. And it’s competitive. There’s no telling what nonce will work, so the goal is to plow through them as quickly as possible.

  Early on, miners recognized that they could improve their chances of success by combining into mining pools, sharing computing power, and divvying the rewards up among themselves. Even when multiple miners split these rewards, there is still ample incentive to pursue them. Every time a new block is mined, the successful miner receives a bunch of newly created bitcoins. At first, it was 50, but then it halved to 25, and then it became 12.5. The fourth halving in bitcoin’s history occurred on May 11, 2020, and now the reward is set at 6.25.

  

  The reward will continue to halve every 210,000 blocks, or about every four years, until it hits zero. At that point, all 21 million bitcoins will have been mined, and miners will depend solely on fees to maintain the network. When Bitcoin was launched, it was planned that the total supply of the cryptocurrency would be 21 million tokens.5

  The fact that miners have organized themselves into pools worries some. If a pool exceeds 50% of the network’s mining power, its members could potentially spend coins, reverse the transactions, and spend them again. They could also block others’ transactions. Simply put, this pool of miners would have the power to overwhelm the distributed nature of the system, verifying fraudulent transactions by virtue of the majority power it would hold.

  That could spell the end of Bitcoin, but even a so-called 51% attack would probably not enable the bad actors to reverse old transactions because the proof of work requirement makes that process so labor-intensive. To go back and alter the blockchain, a pool would need to control such a large majority of the network that it would probably be pointless. When you control the whole currency, with whom can you trade?

• (no title)Apr 11, 2022