[Bitcoin's Trajectory] | Crypto Academy - S4W5 | Homework Post for @imagen
Introduction
Hello to everyone,
In this post, there are assignments given by professor @imagen in Bitcoin's Trajectory course. I will try to present you information in a simple and understandable language as much as I can. Let's start!
Question 1
How many times has Bitcoin been "halved"? When is the next expected? What is the current amount that Bitcoin miners receive? Mention at least 2 cryptocurrencies that have halved or halved.
In order for my answers in this section to be more understandable, I would first like to give brief information about a few topics.
In order for Bitcoin and many other blockchain technologies to work and function; Decentralized nodes are created by coming together, these nodes provide both the security of the network and the confirmation of transactions on the network and the creation of blocks. In this way, the network becomes sustainable and continuous.
Networks with blockchain technology use different consensus mechanisms for these transactions. Bitcoin, on the other hand, uses the Proof of Work (PoW) algorithm from these consensus mechanisms.
If we talk about the way the PoW algorithm works; There are nodes called Miner on each network. To be able to verify and generate transactions and blocks on the network, miners must solve some complex problems. Since these problems are very difficult to solve, powerful computers are needed. Because the miner who first solves the problem and verifies the transactions in the block broadcasts the transaction on the network, as a result, he is entitled to receive the cryptocurrency reward determined for mining and the fees for the transactions on the block.
The Bitcoin network also has a certain miner reward as it uses the PoW consensus algorithm. As Bitcoin, which has a total supply of 21 million, and many cryptocurrencies; There are many reasons such as keeping nodes in the network for a long time, preventing price drops, prolonging the time to reach the maximum amount to be produced. Because when mining rewards run out in a blockchain network, nodes leave that network and turn to other alternatives. For this reason, it is a right decision to decrease the block rewards as the number of miners increases.
How many times has Bitcoin been "Halving"?
After Bitcoin hit the market in 2009, mining rewards are halved every 4 years, or every 210,000 blocks. To date, Bitcoin has been halved three times in total. While the initial mining reward was 50BTC per block in 2009, it was reduced to 25BTC per block in the first halving in 2012. Later, another Halving took place in 2016 and fell to 12.5BTC, while another occurred in 2020 and fell to 6.25BTC.
When is the next Halving?
As we mentioned earlier, Bitcoin performs a halving every 210,000 blocks. If we consider that the creation time of each block in the Bitcoin network is 10 minutes, it takes about 4 years. Since the last Halving to occur is 2020, the next expected Halving will be in 2024.
What is the amount received by Bitcoin miners?
As we mentioned before, after the halving in 2020, the amount of rewards decreased to 6.25BTC. After the expected halving in 2024, this amount will decrease to 3.125BTC.
Mention at least 2 cryptocurrencies that are or have halved.
DogeCoin (DOGE)
Doge Coin was first introduced in 2013. Then, not long after, Halving was performed on April 28, 2014. Before the halving, the Miners reward per block was 250DOGE, while after the halving it was reduced to 125DOGE. However, there is an issue that should not be forgotten; DogeCoin has only performed this Halving once.
Verge (XVG)
Verge coin was first launched in 2014 under the name DogeCoinDark. Contrary to its name, it has nothing to do with DogeCoin. For this reason, it has gone through an innovation and its name was changed to Verge in 2016. In the previous halving of Verge Coin, the reward per block was reduced from 200XVG to 100XVG. Later, it performed another halving and the mining reward decreased to 50 XVG. There is a period of approximately 5 months for the next halving, which will take place. In this halving, the reward amount, which is 20XVG per block, will be reduced to 25XVG per block.
Question 2
What are the consensus mechanisms? How are Proof-of-Work and Proof-of-Stake different?
Consensus Mechanisms
Consensus Mechanisms; It is formed by the combination of the words Consensus and Mechanism.
Consensus: Means a generally accepted opinion or decision among a particular group.
Mechanism: It is the fulfillment of any task within the framework of certain rules by fulfilling the specified number of steps.
When we combine the two definitions; We can say that it is a decision or consensus of a certain group based on general acceptance within the framework of certain rules.
Consensus Mechanisms are one of the basic building blocks of blockchain technology. Its task is; It is the system that enables the creation and verification of blocks and transactions on the blockchain network.
To define it more comprehensively; In blockchain technology, transactions and data are recorded in a distributed ledger and are kept in this ledger until the accuracy of transactions and data is ensured. Without a central intermediary to verify these transactions, the participants (Nodes) that make up the network must arrive at a decision and validate the transaction for the information added to the distributed ledger according to predetermined rules. In short, the nodes in the network need to reach a consensus. In this way, consensus is achieved in a fair and reliable manner without the need for a centralized structure.
There are many types of Consensus Mechanisms. The most common of these are; Proof of Work (PoW) and Proof of Stake (PoS) algorithms.
Proof of Work (PoW)
The PoW blockchain algorithm can be considered the ancestor of all consensus algorithms because it was implemented in the first cryptocurrency, Bitcoin. In the PoW algorithm, validators are called "miners".
The PoW algorithm is an algorithm used by miners to add a new block to the blockchain and confirm transactions. The PoW algorithm also plays a very important role in the security of the network. E.g; It provides solutions to many problems such as double spending, DoS attack.
How Does the PoW Mechanism Work
In short, it is an algorithm where Miners compete with each other to solve complex cryptographic puzzles. These cryptographic puzzles are not easy to solve, but once solved, they can be quickly verified. In this way, if the miner finds a solution for a new block, it shares that solution with other nodes. When other nodes approve this solution, the block is validated and published.
Miners in the PoW mechanism are responsible for adding new blocks to the chain as we said earlier. However, they try to solve these cryptographic puzzles by trial and error, so they need powerful computers. Because the miner who solves the cryptographic problem the fastest is entitled to receive the mining reward.
Proof of Stake (PoS)
On the basis of the Proof of Stake algorithm, it was created to eliminate these deficiencies by considering the deficiencies of the PoW algorithm. In the PoS algorithm, nodes do not need to do work to confirm blocks and transactions. For this reason, powerful computers are not needed.
In the PoS algorithm, validators (nodes) can verify blocks and transactions according to the amount of coins they stake, and thus gain the right to receive mining rewards. In short, in this algorithm, miners (validators) have mining power proportional to the amount of coins they have.
Differences Between Proof of Stake (PoS) and Proof of Work (PoW)
| Proof of Work | Proof of Stake |
|---|---|
| It requires powerful computers that require high processing power. | The amount of coins staked is important when creating a new block. |
| Powerful computers incur high costs. It also causes high energy consumption. | It does not need powerful computers, so it does not consume high energy. |
| Nodes compete with each other to win a prize, and the first node to find the solution is entitled to receive the prize. | The reward system is directly proportional to the amount of coins you stake. |
| Block production speed is slow. | Blocks are produced quickly. |
| Transaction costs are high. | transaction costs are low. |
| May be subject to 51% attack. (Although it is difficult for Bitcoin, it can be easy for altcoins. | It is more difficult to be attacked by 51%, because if he wants to perform this attack, he must have 51% of the coins staked. |
Question 3
Enter the Bitcoin explorer and specify the hash corresponding to the last transaction. Show Screenshot.
In this section, to examine the last transaction performed on the Bitcoin network;
- First, we visit the Blockchair platform.
- Then we click on the "Explorers" option. From the drop-down menu, we hover over the “Bitcoin” option and click on the “Transactions” option.
- On the next screen, blocks and operations are displayed. In order to open the last transaction, we click on the top transaction (shown with the box).
- On the next screen, we can see the Block and Transaction information in detail.
Block: 704129
Hash: 000000000000000000007daaed7b668bacd77321dee738903dfa00e6b29c3ad3d
Creation time: October 8, 2021 20:47 UTC
Question 4
What does Altcoin Season mean? Are we currently in Altcoin Season? When was the last Altcoin Season? Mention and show 2 Altcoin charts after their growth in the latest Season. Give reasons for your answer.
What is Altcoin Season?
First, let's make sure we know exactly what the term Altcoin is.
Altcoin: It is the general name given to the top 50 cryptocurrencies other than Bitcoin and Ethereum cryptocurrencies.
If it is Altcoin Season; It covers a 90-day period in which 75% of altcoins in the top 50 outperform Bitcoin.
Are we currently in Altcoin Season?
To see if we are in altcoin season, we go to BlockchainCenter.Net.
- As you can see in the screenshot above, our scale currently shows 53.
In order for us to be in altcoin season, the value of 53 must have a value of 75 or higher.
When was the last Altcoin Season
To find out, we go to the BlockchainCenter.Net platform and when we scroll down our page, a graphic welcomes us.
- As we can see in the graphic in the screenshot above; It is a 90-day process covering the months of March and June.
Mention and show 2 Altcoin charts after their growth in the last Season. Give reasons for your answer.
When we go down a little bit on the page, a painting welcomes us.
- The table above shows the top 50 Performances over the past season (90 Days).
Axie Infinity (AXS)
As we can see in the top 50 altcoins chart, AXS is among the top 3 altcoins.
As you can see in the screenshot above, the AXS token was worth less than $1 when it first came out. However, with a growth value of 630.5%, its current price is around 124 USD. The ATH value is 155.08 USD.
Fantom (FTM)
As we can see in the top 50 altcoins chart, FTM is among the top 3 altcoins.
As you can see in the screenshot above, the FTM token was worth less than $0.1 when it first came out. However, with a growth value of 977.6%, its current price is around 2.41 USD. Its ATH value is 2.43 USD.
Question 5
Purchase at least 15 USD of your chosen exchange from your verified account in a currency that is not in the top 25 of Coinmarket (SBD, tron or steem not allowed). Why did you choose this coin? What is the purpose or purpose behind this project? Who are the founders/developers? Specify the currency's ATH and current price. The reason for your answers. Show Screenshots.
In this section I choose FTT token to invest. I will receive the purchase from my verified account on the verified FTX exchange.
- First, I enter my FTX account and open the spot market option, which is worth 15 USD; I buy 0.2 FTT tokens.
Why I Chose FTT token
First of all, I would like to point out that; I generally use the FTX platform in my trades and therefore I prefer to buy this token, There are also features that the FTX exchange offers to its users, of course. If you have FTT tokens in hand, the FTX exchange offers many opportunities to its users. Some of these; It has features such as providing discounts in transaction fees according to the amount of FTT held by its users, and allowing users to directly buy leveraged tokens without margin trading. It is also a reliable and high-volume exchange token, a token with a future and backed by Alameda Research, one of the largest cryptocurrency liquidity providers.
Purpose Behind the Project
To put it broadly, the purposes behind the FTT coin are:
When users use leveraged transactions; It aims to perform transactions in a safe, fast and automatic way. The FTT token stands out thanks to this feature. Because with this feature, they have integrated security and automatic transaction elements into their ecosystem. In addition, as we mentioned before, the FTX exchange aims to provide many benefits to its users. These; We can earn interest at certain rates by staking the FTT tokens we hold, as well as discounts on the commission fees we pay during our trades.
The Team and Founders Behind the Project
Under the management of FTT; Sam Bankman-Fried is CEO of Alameda Research and FTX. Another name next to Sam is Gray Wang.
The entire team, as you can see in the screenshot above:
- Sam Bankman- Fried (CEO and Founder)
- Gary Wang (GTO and Founder)
- Nishad Singh (Head of Engineering)
- Jen Chan (Chief of Staff)
- Dan Friedberg (Regulatory Officer)
- Can Sun (General Counsel)
They also have many Affiliates as you can see in the screenshot above.
FTX Token (FTT) Price and ATH Value
As you can see in the screenshot above;
Instant FTT Price: 55.11 USD
Again, as we can see in the screenshot above;
All Time High (ATH): USD 85.02
All Time Low (ATL): 0.8313 USD
Conclusion
After Bitcoin, the ancestor of cryptocurrencies, was released, many projects and new cryptocurrencies followed it. While not every emerging cryptocurrency has gained popularity, many have succeeded. Following this, we have included the first 50 of the new cryptocurrencies in a category we call Altcoins. Altcoins have succeeded in making up for Bitcoin's shortcomings in many ways. In addition, a wide range of investments has emerged for traders. In this lesson, we tried to deal with these issues in detail.
I would like to thank professor @imagen and everyone who read my post for this beautiful lesson that contains a lot of information to learn. I wish you all a healthy and beautiful day.
Gracias por participar en la Cuarta Temporada de la Steemit Crypto Academy.
Felicitaciones!
Continua esforzandote, espero seguir corrigiendo tus asignaciones.