Bitcoin: Confused About Bitcoin?

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BitcoinConfused About Bitcoin Technology

Bitcoin

Bitcoin

"General tax principles that apply to property transactions apply to transactions using virtual currency.”

Statement made by the IRS on trying to claim their slice of the Bitcoin pie…..

Bitcoin

Bitcoin Basics

You may be entirely clueless, like, that is, devoid of even a single ounce of knowledge when it comes to the phenomenon called Bitcoin, but after reading through this quick synopsis of Bitcoin and the technology behind Bitcoin, you’ll be a quintessential Bitcoin whiz.

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Well, okay, not quite but you get the drift.

If you’re new to bitcoin and you’d like to get started because you’ve heard it’s cutting edge craft and you feel you are missing out big time, relax you really don’t need to be a techie geek sort.

After all, even your grandmother could figure Bitcoin out, so there’s no excuse why

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You need to install a bitcoin wallet either on your smartphone/mobile device or computer. Once that’s done you’ll get a Bitcoin address. Give this address out to your friends (and granny), and they can then pay you or you can pay them – in Bitcoin, of course.

It’s a similar concept to email and how that technology works, with the exception that a Bitcoin address should be used one time only.

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Balances - Blockchain

The entire Bitcoin network has to run on some foundation and the foundation is called blockchain. Every single confirmed transaction is listed in the blockchain. As such, Bitcoin wallets are able to recalculate a new balance and transactions are verifiable.

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The chronological order and integrity of the blockchain are sanctioned by cryptology, so you’re not going to lose your shirt by someone stealing your Bitcoin.

Private Keys for Bitcoin Transactions

A Bitcoin-related transaction is reallocation of value among Bitcoin wallets, which of course is listed within the blockchain. It would be, wouldn’t it?

Every Bitcoin wallet holds a very secretive part of data which is termed as a seed or a private key. This is used to sign for a transaction and thus algorithmic (think Google algorithms) proof is available that the transaction was made by the wallet owner.

Bitcoin

Bitcoin

Transactions occur between Bitcoin users are confirmed within the blockchain network within around 10 minutes’ time. This part of the process is referred to as ‘mining’, a term not to be confused with digging for coal.

Mining

What is mining? In techie type of terms it’s a distributed consensus system which is utilized to confirm every transaction that is waiting. These transactions are included in the blockchain.

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Mining allows the chronological order to be enforced within the blockchain, serves as protection for the neutrality of the network, and permits various computing systems to come to agreement about the system’s state – aka condition.

The network verifies transactions that are packed within a block. This follows very strict cryptographic regulations and allows the transaction’s confirmation.

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The regulations do not allow any modification to previous blocks. If that occurred then everything that followed would be invalidated, or messed up, in layman’s terms.

No-one that uses Bitcoin has any control over the blockchain. If they did, they could easily recharge their own Bitcoin accounts, which would be something similar to illegally wiping your credit card clean after maxing it out on a holiday to Timbuktu.

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http://wesleyyuhninfo.com/

http://www.scoop.it/t/bitcoin-by-wesley-yuhn-1

https://bitcoin.org/en/how-it-works

www.economist.com/bitcoinexplained

venturebeat.com/2014/02/17/bitcoin-for-idiots-an-introductory-guide/