The Importance of Decentralization
As you now know, the blockchain protocol is able to confirm a transaction without a third party and no single authority has control over the network. This is why it is decentralized. But why is this important?
Firstly, decentralization is very secure. In fact, the security features of a decentralized blockchain are so secure that it is almost impossible to hack. Before I explain why I want you to think about how a centralized network functions.
Let’s take a look at an organization like Yahoo. They are one of the largest companies in the world who offer lots of services such as email, news, and video content. All of their data is stored on a centralized server, which in most cases is fine. But what happens if the centralized server fails?
This is exactly what happened in 2016 when a group of hackers managed to gain control of the Yahoo servers, which then allowed them to access more than 3 billion private email accounts.
This isn’t a one-time incident either. Whether its social media, banks, internet service providers or the U.S. election, centralized servers are hacked all the time. However, the good news is that decentralized servers are virtually impossible to hack. Here’s why!
Do you remember how my “What is Blockchain” guide explained that to confirm a transaction, lots and lots of people contribute their computational power? These “Nodes” not only help verify a movement of funds, but they also keep the network secure. This is because more than half of the nodes on the entire network would need to be hacked at the same time for something bad to happen!
Even if this was possible (which it isn’t, really), the hacker would only be able to make changes to the blockchain for 1 block, which in the case of Bitcoin, would be about 10 minutes!
Decentralization isn’t only important for security, but for equality, too. Everyone who engages with the blockchain has the ability to contribute to the system. Furthermore, as each and every transaction is available to view on the public ledger, it makes the network transparent. No corruption, no fraud, and no inequality!
Now that you know why decentralization is important, the next part of my What is Blockchain tutorial is going to look at how anonymous the blockchain is!
How Anonymous is the Blockchain?
When Satoshi Nakamoto created Bitcoin in 2009, he not only wanted to create a fair, secure and transparent payment system, but he also wanted to allow people to send and receive funds anonymously.
Think about how you spend your money in everyday life. When you withdraw money from the ATM machine, the bank knows where you are and how much you are spending. When you use your credit card on holiday, the credit card company also knows where you are and how much you spend.
When you receive your monthly salary, the bank knows how much you are being paid. The list goes on and on, but the point is that third-party intermediaries have lots of information on you. But what gives them the right to know exactly what you’re doing with your hard-earned money? Nothing does! They shouldn’t know.
This is where blockchain technology is different. When you obtain a cryptocurrency, you store it in a digital wallet. This can be stored on your desktop or mobile, online or even on a hardware device. The cryptocurrency is then attached to something called a wallet address. You can have as many wallet addresses as you want, but no two can ever be the same.
When you send funds to somebody, you send them from your wallet to somebody else’s wallet. Here is what a blockchain Bitcoin transaction would look like.
Wallet “1BoatSLRHtKNngkdXEeobR76b53LETtpyT”
Sent “2 BTC” to
Wallet “1CfaunqrVpcXmpLheUVWeSP1KPsKDha1Nb”
On Friday 18th May 2018 at 15.37.
As you can see from the above information, as soon as the transaction is confirmed, everybody can see the amount that was sent and the date and time of the transaction. However, the only information that people know about the sender and receiver is their wallet address.
It is because of this that blockchain transactions are not anonymous, but pseudonymous (like an alias).
However, this is just like spending cash in the physical world. When you walk into your local supermarket and pay with cash, the supermarket knows what you look like, but they don’t have any other information about you!
So, now that you know that the blockchain is pseudonymous rather than anonymous, the next part of my “What is Blockchain” guide is going to look at how it can be used in the real world.
ethereum programming clockworkmod tether bitcoin презентация
bitcoin solo
bitcoin кредит bitcoin dollar мавроди bitcoin bitcoin forecast bitcoin darkcoin продаю bitcoin bitcoin motherboard bitcoinwisdom ethereum bitcoin conference global bitcoin happy bitcoin bitcoin json 60 bitcoin bitcoin nvidia bitcoin фильм bitcoin путин ethereum прогноз 2016 bitcoin reddit cryptocurrency bitcoin dollar ethereum logo bitcoin miner monero pro to bitcoin lamborghini bitcoin платформу ethereum cardano cryptocurrency bonus bitcoin bitcoin hacker
san bitcoin рынок bitcoin etherium bitcoin спекуляция bitcoin bitcoin casino tether android bitcoin biz регистрация bitcoin bitcoin блок ethereum dag gek monero bitcoin telegram Bitcoin is the first successful implementation of a distributed crypto-currency, described in part in 1998 by Wei Dai on the cypherpunks mailing list. Building upon the notion that money is any object, or any sort of record, accepted as payment for goods and services and repayment of debts in a given country or socio-economic context, Bitcoin is designed around the idea of using cryptography to control the creation and transfer of money, rather than relying on central authorities.Crypto mining graphic: It shows a distributed ledger in cryptocurrency miningAmong its perceived flaws as a currency, bitcoin is viewed by many to be too complicated to ever achieve widespread adoption. In reality, the dollar is complicated; bitcoin is not. It becomes very simple when abstracted to the least common denominator: 21 million bitcoin; and who controls the money supply: no one. Not the Fed or anyone else. At the end of the day, that is all that matters. Bitcoin is in fact complicated at a technical level. It involves higher level mathematics and cryptography and it relies on a 'mining' process that makes very little sense on the surface. There are blocks, nodes, keys, elliptic curves, digital signatures, difficulty adjustments, hashes, nonces, merkle trees, addresses and more. cryptocurrency calendar bitcoin passphrase bot bitcoin bitcoin analytics bitcoin card бесплатный bitcoin bitcoin bcn monero майнить bitcoin daemon bitcoin doge разработчик bitcoin world bitcoin вложения bitcoin monero usd bitcoin сша крах bitcoin
ethereum видеокарты locals bitcoin Cryptography in Bitcoin Transactionsbitcoin links bitcoin review bitcoin игра
bitcoin cz поиск bitcoin bitcoin transactions Zero was liberation discovered deep in meditation, a remnant of truth found in close proximity to nirvana — a place where one encounters universal, unbounded, and infinite awareness: God’s kingdom within us. To buddhists, zero was a whisper from the universe, from dharma, from God (words always fail us in the domain of divinity). Paradoxically, zero would ultimately shatter the institution which built its power structure by monopolizing access to God. In finding footing in the void, mankind uncovered the deepest, soundest substrate on which to build modern society: zero would prove to be a critical piece of infrastructure that led to the interconnection of the world via telecommunications, which ushered in the gold standard and the digital age (Bitcoin’s two key inceptors) many years later.bitcoin лотереи
bestexchange bitcoin bitcoin рынок bitcoin пирамида putin bitcoin форекс bitcoin The system as a whole owes far more dollars than exist, creating an environment where on net there is a very high present demand for dollars. If consumers did not pay debt, their homes would be foreclosed upon, or their cars would be repossessed. If a corporation did not pay debt, company assets would be forfeited to creditors via a bankruptcy process, and equity could be entirely wiped out. If a government did not pay debt, basic government functions would be shut down due to lack of funding. In most cases, the consequence of not securing the future dollars necessary to repay debt means losing the shirt on your back. Debt creates the ultimate incentive to demand dollars. So long as dollars are scarce relative to the amount of outstanding debt, the dollar remains relatively stable. This is how the Fed’s economy works, incentivize credit creation and you create the source of future demand for the underlying currency. In a sense, it’s kind of like a drug dealer. Get an addict hooked on your drug and he will keep coming back for more. In this case, the drug is debt, and it forces everyone, on net, to stay on the dollar hamster wheel.bitcoin nachrichten ethereum пулы ann ethereum биржи bitcoin simplewallet monero ico cryptocurrency bitcoin ann bitcoin бумажник bitcoin tube bitcoin xyz ethereum стоимость bitcoin checker
bitcoin wm основатель ethereum seed bitcoin nicehash bitcoin
ethereum кошелька bitcoin song bitcoin scrypt bitcoin ads bitrix bitcoin bitcoin сети bitcoin tm casinos bitcoin 4.1Bitcoin-type proof of worksafe bitcoin монет bitcoin Alternatively, if you were to sell the BTC after holding it for more than 12 months, the $16,000 profit will be subject to long-term capital gains which offer you more favorable tax rates (0%, 15%, or a maximum 20%).bitcoin weekly
bitcoin покер bitcoin invest best cryptocurrency double bitcoin monero пул
bitcoin казино bitcoin talk okpay bitcoin bitcoin настройка hyip bitcoin tether майнинг bitcoin playstation etherium bitcoin знак bitcoin sberbank bitcoin monero криптовалюта dark bitcoin 100 bitcoin monero майнинг bitcoin раздача bitcoin scripting pools bitcoin ethereum russia куплю bitcoin
bitcoin farm зарабатывать bitcoin bitcoin лучшие bitcoin валюты bitcoin btc
bitcoin информация инвестиции bitcoin bitcoin funding system bitcoin maining bitcoin bitcoin novosti bitcoin casino bitcoin vpn bubble bitcoin bitcoin world loan bitcoin ethereum pools bitcoin okpay bitcoin java новые bitcoin валюта monero bitcoin daily bitcoin виджет блоки bitcoin life bitcoin bitcoin обменники запуск bitcoin bitcoin сети tabtrader bitcoin mine monero casinos bitcoin loans bitcoin bitcoin suisse сложность ethereum bitcoin теханализ bitcoin сервисы bitcoin iq котировки ethereum armory bitcoin play bitcoin mac bitcoin платформу ethereum bitcoin haqida bitcoin wallpaper
bitcoin автомат
bitcoin википедия bitcoin bat bitcoin q bitcoin investing hashrate bitcoin bitcoin frog ethereum browser bitcoin conf bitcoin окупаемость tether ico supernova ethereum cryptocurrency mining raiden ethereum ann bitcoin ethereum хешрейт ethereum pool kupit bitcoin bitcoin аналитика
лохотрон bitcoin bitcoin red что bitcoin ethereum pools map bitcoin bitcoin kran
security bitcoin bitcoin mining logo ethereum monero freebsd alpha bitcoin bitcoin protocol
bitcoin count php bitcoin биржа bitcoin monero график смесители bitcoin bitcoin greenaddress converter bitcoin bitcoin fpga bitcoin bounty bitcoin blue 1000 bitcoin bitcoin apple 8 bitcoin настройка bitcoin security bitcoin ethereum asic bitcoin usa ubuntu bitcoin get bitcoin instant bitcoin компиляция bitcoin
hub bitcoin tether plugin
mine ethereum eobot bitcoin top bitcoin earning bitcoin usb bitcoin bitcoin pools bitcoin programming
oil bitcoin ssl bitcoin bitcoin check bitcoin purse ethereum алгоритм
bitcoin qiwi
china bitcoin ethereum blockchain bitcoin софт bitcoin cny bitcoin хардфорк bitcoin community bitcoin knots bitcoin 2016 ethereum torrent
конвертер bitcoin bitcoin visa captcha bitcoin bitcoin links bitcoin ставки bitcoin payeer bitcoin 4 neo bitcoin ethereum supernova bitcoin weekly рынок bitcoin ads bitcoin carding bitcoin фермы bitcoin monero blockchain доходность bitcoin bitcoin review bitcoin conveyor master bitcoin
