Bitcoin, Cryptocurrencies, Public chain–Steemit Crypto Academy Season4-Homework post for Task5
Hello guys,
I humbly welcome all to my assignment post, the Season4 beginners' fixed course given by my awesome Prof @stream4u.
This course promises to be very fruitful as it tends to enlighten us on so many things.
Before I proceed any further, I request for the permission to do the needful by listing the three solid questions before me of which I am instructed to do.
(1)
WHAT IS CRYPTOCURRENCY AND HOW YOU WOULD LIKE TO SEE CRYPTOCURRENCY IN THE FUTURE
(2)
WHAT IS BITCOIN AND WHAT WAS THE AIM BEHIND BITCOIN INVENTION?
IS CRYPTOCURRENCY GOOD FOR A BUSINESS TO ACCEPT AS PAYMENT? WHY?
(3)
WHAT IS PUBLIC CHAIN AND WHAT WILL BE THE ADVANTAGES AND DISADVANTAGES OF PUBLIC CHAIN?
As seen above, all the listed questions are interesting and educative.
It saddens me to know that I am just going to discuss one of them.
I have decided to explore question 2 which has been mentioned above.
I chose to explore question 2 because it has so many potentials as it is linked to question one, so that way, we will be indirectly exploring question one also. This will be great.
In our adventure, we shall discuss on the origin of cryptocurrency and how it relates to our main topic and also the aim of Bitcoin project.
Eliminating any further delay, shall we proceed to the first subheading.
WHAT IS BITCOIN
Due to the interrelatedness of Bitcoin and cryptocurrency, it would be unrealistic to discuss about Bitcoin without first exploring what cryptocurrency is, as Bitcoin happens to be the first and leading cryptocurrency in existence.
Cryptocurrency are digital assets/currency that are developed on a decentralized system using a block chain technology.
Cryptocurrency can be said to be another form of currency that can be used to purchase goods but this time, a currency that runs on a decentralized system.
Unlike the currencies that we are well familiar with that is controlled by a central authority, cryptocurrency is controlled by no one, as it is managed using what is known as cryptography.
Cryptocurrency can also be referred to as a binary data that is developed to run as a means of exchange where the records of individual coin owner are kept secured in a ledger that exists as a computerized database.
As earlier stated, cryptocurrency makes use of a strong cryptography to secure records of transactions carried out, to validate ownership of coins, to control and facilitate the creation of coins.
Having explored this, let's make progress by examining a little, the identifying mark of Cryptocurrencies.
FEATURES OF CRYPTOCURRENCY
There exists numerous unique qualities of cryptocurrency, some amongst them are;
- SECURITY:
One of the most unique characteristics of cryptocurrency is it's tight security.
The security designed for cryptocurrency makes it almost impossible to hack and this is due to the fact that it runs on a blockchain technology. - BLOCKCHAIN TECHNOLOGY:
Another unique identification of cryptocurrency is that it runs on a blockchain technology.
A blockchain us a digital ledger in which information if transactions are recorded and this is done in a method almost impossible to hack. - DECENTRALIZATION:
As earlier stated, cryptocurrency runs or is built on a decentralized system, that is, it is under the control of no one. - IMMUTABILITY:
Once a transaction has been carried out on cryptocurrency, it becomes irreversible, unchanged, irrespective of the amount involved. - TRANSPARENCY:
Transparency in the transaction of cryptocurrency is another thing I love the most about cryptocurrency, you cannot be cheated as everything will be openly exposed to you.
Shall we continue on our wondrous adventure as we proceed on the types of cryptocurrency we have.
Popularly known, there are majorly two types of Cryptocurrencies and they are BITCOIN and ALTCOINS(alternative coins).
All other coins are summed up to alternative coins because none can measure up to BTC.
Finally, we have gotten to our first target, which is the exploration of BTC.
BTC is the first cryptocurrency to ever come into existence and it may be expressed as a digital currency that runs on a decentralized system, that is, free of control of central authority.
BTC also runs on a network known as peer-to-peer network.
It is good to note that everything we discussed about cryptocurrency all applies to BTC, as BTC happens to be the first cryptocurrency.
The cryptocurrency BTC that runs on a peer-to-peer network was developed in the year 2008 by the name Satoshi Nakamoto and it was developed on a blockchain technology.
Bitcoin is a currency that can be mined by miners, the total amount of BTC that can ever be mined is 21million and this number can't be exceeded.
Miners are being rewarded for being able to mine a block of BTC successfully as this requires time and calculations. They are rewarded with what is known as block rewards.
These block rewards are usually divided into two, that is, they are usually halved after the successive mining of 120000 blocks and this happens roughly within an interval of four years.
Way back in the year 2009, 50BTC happened to be the block reward for mining a block of BTC, but after undergoing it's first halving, it was reduced to 25btc and it's second halving reduced it to 12.5btc.
And from calculations, it's last halving occurred on May 11th, 2020 and it's reward was reduced to 6.25BTC.
This means that the current block rewards of BTC is 6.25btc for each block mined.
True, the halving of BTC has significant influence on the price of BTC, it gradually diminishes the inflation rate of BTC and correspondingly increases it's purchasing power (price).
In the year 2011, the inflation rate of BTC happened to be 50% and it decreased to 12% in the year 2012 after it's halving, and it later declined to 5% in the year 2016 after it's next halving.
As stated, the decrease in the inflation rate of BTC often leads to increase in price, for example, the price of BTC escalated from $650 to $20000 in the year 2016 after it underwent its 2nd halving.
As earlier stated, it takes the successive mining of 210000blocks before an halving event can occur.
Now let's calculate how many blocks remaining for it's next halving.
From history and calculations made, we were made to understand that BTC has undergone halving 3times and the next one will be it's 4th halving.
For the 4th halving event to occur, 840,000blocks must have been mined successfully and this is gotten from 210000×4, which is the total number of block per halving multiplied by it's number of halving.
From the above screenshot, the block height of BTC as of when this post was made is 701,390blocks and we need a total of 840000blocks for it's next halving.
The number of blocks remaining is gotten by 840000-701390=138610blocks.
This means that an additional 138610blocks must be mined for the next halving to occur.
Source
I also visited coinmarket cap for further exploration and the following analysis was gotten from my adventure as of when the post was made.
| BTC | Analysis |
|---|---|
| Price | $44,983.73 |
| Low | $44,659.16 |
| High | $48,105.31 |
| Circulating supply | 18,821150 |
| Total supply | 18,821,150 |
| Max supply | 21000000 |
| Market cap | $846,915,167,149 |
| Fully diluted market cap | $945,207,673,826 |
| Vol 24hr | $31,549,089,214 |
| Vol/market cap | 0.03726 |
Having explored this, let's move to the founder of BTC.
The truth remains that the identity of the founder of BTC remains anonymous, all we know is that BTC was invented by the name Nakamoto Satoshi.
It is not indicated if the name belongs to a female, amale, a group of persons or a company.
Although there have been some claims on the identity of Nakamoto Satoshi and some of them with their pictures will be given below
It is also important to explore the unit of measurements of BTC.
BTC is measured in Satoshi, it is named after it's founder and
1satoshi= 1×10-8BTC
And 1btc= 1giga Satoshi.
Shall we proceed, with no confusion on our previous adventure to the next task
WHAT WAS THE AIM BEHIND BTC INVENTION
Definitely, Nakamoto cannot just work so hard in the invention of BTC without having a good aim/goal in mind.
BTC was invented to make available an alternative means of payment that would be free of the control of central authorities.
The main motivation for the development of BTC was due to the financial crisis that occurred back then in the year 2008 and this was due to total reliance of the world on banks for financial transactions.
So in other words, BTC was created so that transactions can be carried out without the intervention of third party.
Without any further Ado, shall we make progress to our next task
IS CRYPTOCURRENCY GOOD FOR A BUSINESS TO ACCEPT AS PAYMENT? WHY?
As for me, I think cryptocurrency is good for a business to accept as payment.
I said this for the following reasons;
- TRANSACTION FEES: The transaction fees for Crypto payment is very low, irrespective of where it is transferred to.
- OWNERSHIP OF FUND: Individuals will have 100% control over their funds as it can be assessed whenever it is needed
- SECURITY:. Security of funds is also another factor, the use of cryptocurrency as payment guarantees security of funds.
- PRIVACY: Yes, privacy is also something that will be enjoyed, as you will need to give no explanation on how your money is spent.
CONCLUSION
I sincerely appreciate Prof @stream4u for this wonderful assignment as it has increased my knowledge on cryptocurrency and most especially BTC.
I really enjoyed the assignment.
My comment box is open to all who has additional information to add or who has questions to ask, please feel free to visit.