The transcription of the word “bitcoin” is used on the official website, as well as on Wikipedia. There is also an abbreviation for BiTCoin – it is BTC or the same in Russian letters – BTK, but the latter is not used with us.
Bitcoins are considered the money of the future. They began to be recognized all over the world, there are large companies that are already accepting payments for their services or for equipment sold in bitcoins. We sorted out the stories a bit; let’s get back to bitcoin itself.
What are bitcoins and what is satoshi
Bitcoin is a cryptocurrency, that is, such a monetary unit that it is impossible to touch with your hands, like ordinary money or gold. At its core, bitcoins are simply a collection of numerical values.
One bitcoin can be divided into parts, like, say, a dollar can be divided into cents. By the way, the minimum part of bitcoin is called Satoshi in honor of the creator of the entire system:
one satoshi is equal to 10 to minus 8 degrees of one bitcoin (one hundred millionth part of bikoin or 0.00000001 bitcoin), and some even use the term “cent” in relation to such satoshi,100 Satoshi or one millionth of a bitcoin is called a microbitcoin, one thousandth of bitcoin is called minibitcoin, and it is equivalent to 100 thousand satoshi.
If you explain in simple words, then bitcoin is an object. Let’s imagine that it is a gold coin. So, everyone who owns at least one satoshi in one way or another has this gold coin, but at the same time this person cannot manage the whole coin, but only that part that belongs to him, that is, only one satoshi.
Imagine an ideal coin that cannot be counterfeited, cannot be copied or prohibited. A coin that can be settled at any time. In addition, she will not tear and she will not have wear and tear, as is the case with paper money. This is Bitcoin.
Bitcoins are limited in their production, in total there can be no more than 21 million.
Why bitcoins and their concept are needed
At the moment, bitcoins do not belong to any state in the world, which means that they cannot depreciate with geopolitical changes or the influence of one country on another.
Moreover, bitcoins are not tied to any GDP of any country or all countries as a whole. This is exactly the concept of bitcoins. It says that there must be such money that can belong exclusively to you, it will not be possible to fake it, and instantly at your request you can transfer the required amount by paying for services or goods in any part of the world, if you have Internet access.
Already there are people who use bitcoin mining as their only source of income. And some get paid exclusively in bitcoins.
Digital Signature Algorithm
By sending money, you send to the network the amount by which your balance decreases and the recipient’s balance grows. In this case, a simple rule applies: when performing a transaction, the entry (funds received to your wallet) must be fully spent, i.e. in order to send an amount that is not equal to any of the inputs, you will need to send change to your account.
The one of the best and secure platform for the bitcoin transaction and trade is bitcoin storm.
The nodes or computers of the Bitcoin network copy this transaction into their registers and transmit it to the following nodes. Just like a regular signature, it verifies the message sent to the network, but does so using a mathematical algorithm that prevents counterfeiting and copying in digital space.
A digital signature works at the level of two different but related keys – a private one, which creates a signature and a public one, with the help of which other network members verify it. In other words, the private key is the true password, and the signature is the intermediary who assures that you know the password without having to disclose it. The public key serves as an address for receiving bitcoins.