How does Cryptocurrency Work

Bitcoin is a decentralized cryptocurrency. Its emission is not controlled by any state, transactions are transparent and anonymous. The system is securely protected, it is simple and at the same time extremely complex. In a couple of years, the cryptocurrency and mining are spreading all over the world.

Who Invented Bitcoin?

The history of the Bitcoin creation is ambiguous, intriguing and mysterious. The author of the cryptocurrency is the ephemeral Satoshi Nakamoto – an Internet user (or a group of users) who published an article on cryptocurrency in the mailing list at the end of 2008. They described the digital peer-to-peer currency. At the beginning of the next year Nakamoto released the first software for working with cryptocurrency.

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Bitcoin Basis

  • Hash function. A mathematical transformation by an algorithm that turns any set of information into a unique number-letter value of a certain fixed length – a hash. Something like a cipher. Even a small change of one character in the original data set, causes the output (hash) to change drastically.
  • The key element of the bitcoin system is a blockchain. It is a chain of blocks where information on transactions in the network is stored for the entire time of its existence. A copy of this unique database is kept by every member of the system, gradually and constantly updated due to the receipt of new blocks.

Blockchain , Distributed ledger technology , bitcoin concept. Electric circuit graphic and infographic of Block chain , network connect , security , binary coded icons.

Why is It Safe?

What happens if someone decides to change the transactions in the block and cancel the money transfer or change the addressee? He can do it, but then the hash of the block will change. A new branch will appear in the chain.

To fix its fraudulent block, a hacker will have to solve a new task in 10 minutes faster than others. And one can not solve it beforehand by building blocks, because the solution depends on the hash of the previous block. Thus, an attacker will have to own at least half the power of a Bitcoin network, in order to solve a new task with 50% probability and build new blocks. All in all, this is practically unreal and completely unprofitable.

How are Bitcoins Mined?

Performance diagrams of the network clearly demonstrate that video cards are not of the utmost importance in the field of mining. CPU left this niche in 2011, GPU – in 2013. Now the Bitcoins are mined on the application-specific integrated circuits (ASICs), which are exclusively for the hash calculation. Nevertheless, lots of other cryptocurrencies are still being mined on video cards.

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Canadian VersaBank is Building a Digital Storage for Cryptocurrency

The smallest in terms of assets the Bank of Canada VersaBank announced the creation of a digital vault for cryptocurrency. The new service will be launched in June.

“We’re using what banks are all about — safety and security — only what we’re doing now is saying that physical box in the basement is getting obsolete,” said David Taylor, chief executive officer.

Secure and Super Private Place

To work on the new service, the bank attracted the BlackBerry specialist Gurpreet Sahota. He will lead the team of developers of virtual storage VersaVault. The digital assets will be stored on servers around the world. As in the case of safe deposit boxes, the bank doesn’t know what is inside. In addition, the financial institution will not even have access to the contents of the storage.

“Our differentiator in this market is to be secure and super private,” said Taylor.

The large funds have already shown interest in the novelty. The cost of services in the bank has not yet been determined, but it will not be “cheap”.

The Rapid Fall of Bitcoin. What’s Happening to Cryptocurrency Market?

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Until recently, the Bitcoin rate was around $ 15,000, occasionally increasing or decreasing. But after the news about a possible ban on trade of cryptocurrencies in South Korea and the termination of mining in China, the cost of cryptocurrency began to decline. This morning the Bitcoin’s exchange rate dropped below $ 12 thousand. So, over the last week, the cryptocurrency lost about $3 thousand.

The main key for investors is to stay calm

Over the past year, bitcoin has fallen sharply several times. But after the falls, the currency usually returned to growth and topped its historical highs. However, the last time Bitcoin jumped very high up to $20,000 – on December 17. This is not the fact that the currency will ever be able to beat this record, especially after the recent changes in the market.

In addition  we note, that along with Bitcoin, the price of almost all cryptocurrencies falls down. That is, the whole market of cryptocurrency follows a downward trend. At the time of writing these lines, the global capitalization of all cryptocurrencies is $540 billion.

Cryptocurrency Got the Voice of «Virtual Currency Girls»

Not so long ago in Japan a musical group «Virtual Currency Girls» appeared. The girls have already become popular all around the world.

The Virtual Currency Girls have already had their devoted fans. There are eight participants in the pop group. Earlier this group performed under the name «Kaso Tsuka Shojo». Every performer gets the name of one widespread cryptocurrency. There are Bitcoin and Ethereum among them.

The leader of the group, 19-year-old Rara Naruse reported that their musical group is going to shed some light on the Altcoins and block chain. In an interview for Japan Today, Naruse described the objectives of the team. She said that they carefully selected several cryptocurrencies, which would undoubtedly continue to exist in the future. Rara stated that the group strived to expand understanding of cryptocurrencies and block chain with the public through entertainment.

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Japan becomes a country where the authorities are loyal to the introduction of cryptocurrencies. Eastern neighbours South Korea and China have applied strict rules. They try to abolish the cryptocurrency movement. On the contrary, the Japanese are open to innovations and easily accept changes.

In addition, the Japanese group “J-Pop” also hopes to spread the deep understanding of the digital currencies among their fans. “J-Pop” was at the peak of popularity in the 1990s. It seems that nowadays the group will be able to announce itself once again and return to show business thanks to cryptocurrencies.