Introducing Bitcoin Cryptocurrency - The world is evolving, so is our currency. Introducing
cryptocurrency. Cryptocurrency is a digital medium of exchange, in a less fancy
way internet money. I will talk about the invention of cryptocurrency, how it works
and some stories about cryptocurrency.
To start, the first cryptocurrency ever created was the
Bitcoin which was created in 2009 by a developer nicknamed Satoshi Nakamoto
according to Wikipedia. No one knows where this mysterious lives or his real name.
He stayed anonymous for many reasons. The code for the currency was open to the
world, to this day you can still see the code. The code was so well made that
no one has found a loophole or a glitch that can be exploited.
This sparked an interest to a lot of people to invest in
this currency and copy the code and make a different type. This is where
Litecoin, Dogecoin, Peercoin, Goldcoin, Stable Coin, Grandcoin, BBQ coin,
Franko, Diamond, Neocoin and many more came from. Now that we know the past, we can
move on to the fun part, how it works! If you want to go into more details visit
bitcoin.org. To aid, in comparison, I will use the word Coin instead of
cryptocurrency. To start, if you want to get any coin you must first get the
wallet of that type of coin. The wallet is installed on your computer.
The system of the coin is not like real money, it’s a peer
to peer system. Peer to peer is like a book with all the transaction of the coin’s
ever done, so the balance of your wallet is calculated on every transaction in
and out of your account, so no coins can just appear in a wallet there is
always a paper trail. No transaction can be faked since it’s a block system;
this is the most complicated part of the code since you need a lot of computer
power. A block is what authorize transactions, a block has a complicated math
equation attach to the block that needs a computer to solve it.
Once solved the transaction is broadcast to the world,
updating all the wallet (books) saying that person one sent person tow a coin.
So the computer that solves the math equation is called a miner. Miners a person
that lest the computer to the service of the coin, to solve blocks. Miners get
coins for every block they solve.
This is how the system controls the amount of
coins in the system, like the government controls how much money is printed.
(Example Nigeria government printing too much money) Now a day’s miner is getting stronger computer, more efficient ways of the mining. For example, people
found out that graphic cards run math equations way faster there was 2
problems, took a lot of power and created a lot of heat.
People would buy a lot of graphic cards and put them in one
computer. 8 months the ALU was created. ALU stands for, arithmetic logic unit.
An ALU is a CPU (Computer processing unit) that is tweaked to process math
problem faster, using less power and creating less heat but cost a lot. I
myself am a miner and i do make money, but it’s not a money printer, there are a
lot of things you must do and there is a lot of cost to start up.
To recap, I will use an example. So let’s say that I want to
give Mrs. a coin, l need to go look in my book “Wallet” to see if l have a
enough from difference transaction, Looking at my book I see that she has sent
me a coin. Now i send out a message saying that a want to send a coin to Mrs.
That is picking up by a block. The block is then testified by the miner. Alex, who
is the miner receives some coin for completing the block. Once done the
transaction, Alex tells Mrs. and Marion. Then Marion would tell a couple of
people, this would go on until everyone knows that I sent Mrs. one coin.
Now that Mrs. has a coin what does she do with it? Like real
money you can buy goods and services. Here are some things you can buy Computer
parts, frozen TV dinner, drugs and alpaca socks. You can also sell you coins
for real money. As of this morning on BTC-E.com one Bitcoin cost 460$ and one
Litecoin cost 11$. The price of Bitcoin has fluctuated over the past year,
going up to 1100$ on December 2013 only 4 months ago. This was the
cryptocurrency hype train, a bubble was created, everyone was joining, lots of
investor came in wanting to buy bitcoins so the price went up.
Then some hackers came around going into computers and
stealing all the bitcoin in people's wallet. They stole 6% of all Bitcoin which
is 744 000 coins. At today’s price that’s 342 million dollars. People got
scared and starting, selling, more offers = lower price. Now a day’s the price
moves from 600$ to 400$ so there is still money to made.
Now here are some stories about cryptocurrency
According to the article on tokeofthetown.com a bitcoin miner got raided by the police. The unusual high power usage suspected of growing marijuana in their house. Residents have been charged a $5,200 inspection fee even if no marijuana or signs of a grow operation are found.
Kristoffer Koch invested $26.60 in 5,000 bitcoins in 2009. peer-to-peer digital currency in April 2013 jogged his memory. He then sold it for $886k. A journalist from Bloomberg was given a bitcoin on live TV in December 2013, it was promptly stolen by a viewer.
Here are some fun facts, Vancouver has the first bitcoin cash machine. Bitcoin was once worth more than an ounce of gold. Subway sandwiches can be bought with bitcoin in one location in the US. A limousine can be hired in certain areas of the US using Bitcoin. China also banned banks from trading in Bitcoin.
