Bitcoin (symbol: Ƀ; abbrev: BTC or XBT, peer-to-peer electronic cash system) is a decentralized cryptocurrency-like digital currency, as well as an alternative economic system, featured in 2008 on The Cryptography Mailing mailing list by a programmer, or a group of programmers, under the pseudonym Satoshi Nakamoto; It is considered the world's first decentralized digital currency, and is seen as responsible for the resurgence of the free banking system.
Bitcoin allows financial transactions without intermediaries, but verified by all nodes of the peer-to-peer Bitcoin network, which are recorded in a distributed database, called a blockchain.
The peer-to-peer (or P2P) topology of the Bitcoin network, or alternative economic system, and the absence of a central administrative entity, which makes it impossible for any financial or governmental authority to manipulate the issuance and value of bitcoins or induce inflation by producing more money. However, large speculative movements in supply and demand can cause its value to fluctuate in the foreign exchange market, being freely defined 24 hours a day.
Is Bitcoin a Ponzi or Pyramid Scheme?
A Ponzi scheme is a fraudulent investment operation that pays returns to its investors with its own money, or the money of subsequent investors, rather than profits made by the people who run the business. Ponzi schemes are designed to collapse at the cost of the last investors when there are no more new entrants.
Bitcoin is a free software project with no central authority. Consequently, no one is in a position to make fraudulent representations about return on investments. Like any other currency such as Gold, US Dollar, Euro, Yen etc., there is no guarantee that the purchasing power and exchange rate will fluctuate freely. This leads us to volatility, where bitcoin owners can unpredictably make, or lose, money. In addition to speculation, Bitcoin is also a helpful and competitive form of payment that is being used by thousands of users and businesses.
How are bitcoins created?
New bitcoins are generated through a competitive, decentralized process called “mining”. This process consists of rewarding users for their services. Bitcoin “miners” are processing transactions and making the network secure using specialized hardware and collecting new bitcoins in exchange.
The Bitcoin protocol is designed in such a way that new bitcoins are created at a fixed ratio. This makes Bitcoin mining a very competitive business. As more miners join the network, it becomes increasingly difficult to make a profit and miners need to look for efficiency to cut their operating costs. No central authority or developer has any power to control or manipulate the system to increase its profits. Every Bitcoin node around the world will reject anything that does not conform to the rules the system is expected to follow.
How does mining help keep Bitcoin safe?
Mining creates the equivalent of a competitive lottery that makes it very difficult for anyone to consecutively add new blocks of transactions to the blockchain. This protects net neutrality, preventing any individual from gaining the power to block certain transactions. This also prevents any individual from replacing parts of the blockchain to reverse their own spending, which could be used to defraud other users. Mining makes it exponentially more difficult to roll back a past transaction, requiring all blocks following this transaction to be changed.
BITCOIN CASH – BCH
Bitcoin Cash (BCH) is a harshly forked version of the original Bitcoin BTC. It is similar to bitcoin in terms of its protocol; Proof of work SHA-256 hashing, and has 21,000,000 units available, same lock time and reward system.
However, two main differences are the block limits, as of August 2017, Bitcoin has a 1MB block limit while BCH proposes 8MB blocks. Also, BCH will adjust the difficulty every 6 blocks as opposed to 2016, as with Bitcoin.
Bitcoin Cash is a proposal by mining group viaBTC and mining group Bitmain to conduct a UAHF (User Enabled Fugitive) on August 1 at 12:20 UTC.
They rejected the agreed consensus (also known as BIP-91 or SegWit2x) and decided to conquer the original bitcoin block and create this new version called “Bitcoin Cash”. Bitcoin Cash can be claimed by BTC owners who have their private keys or store their Bitcoins in a service that will split the BCH for the customer.
Why was a fork needed to create Bitcoin Cash?
The original Bitcoin code had a maximum limit of 1MB of data per block, or about 3 transactions per second. While technically simple to raise this threshold, the community was unable to reach a consensus, even after years of debate.
Has the 1MB Block Size Limit Caused Problems for Bitcoin?
Yes, in 2017, capacity reached the “invisible wall”. Fees skyrocketed, and Bitcoin became unreliable, with some users unable to confirm their transactions even after days of waiting.
Bitcoin stopped growing. Many users, traders, companies and investors have abandoned Bitcoin. Its marketshare among other cryptocurrencies quickly dropped from 95% to 40%.
Does Bitcoin Cash Solve These Problems?
Yes. Bitcoin Cash immediately increased the block size limit to 8MB as part of a massive chain-scale approach. There is ample capacity for everyone's transactions.
Low fees and fast confirmations have returned with Bitcoin Cash. The network is growing again. Users, traders, companies and investors are building the future with peer-to-pair real money.
What is Bitcoin Gold?
Bitcoin Gold is a fork of the bitcoin chain that took place on October 25, 2017. At the predetermined block height, Bitcoin Gold miners will start creating blocks with a new proof-of-work algorithm, which will cause a fork of the Bitcoin chain of block. The original Bitcoin block will remain unchanged, but a new branch of the blockchain will separate from the original chain. The new branch is a distinct blockchain with the same transaction history as Bitcoin all the way to the fork, but then diverges from it. As a result of this process, a new encryption will be born.
What is the purpose of Bitcoin Gold?
The purpose of Bitcoin Gold is to make Bitcoin mining decentralized again. Satoshi Nakamoto's idealistic vision of "one CPU one vote" has been replaced by a reality where the manufacturing and distribution of mining equipment has become dominated by a very small number of entities, some of which have engaged in abusive practices against individual miners. and the Bitcoin network as a whole. By switching Bitcoin's proof-of-work algorithm from SHA256 to Equihash, all specialized SHA256 mining equipment will be obsolete for Bitcoin Gold bit block mining. Thus, Bitcoin Gold will provide an opportunity for countless new people across the world to participate in the mining process with widely available consumer hardware that is manufactured and distributed by reputable mainstream corporations. A more decentralized democratic mining infrastructure is more resilient and more in line with Satoshi's original vision.
Bitcoin Cash and B2X are hostile forks that use the same PoW algorithm as Bitcoin – SHA256 – which results in a permanent conflict state over a finite amount of ASIC mining hardware that is required for SHA256 proof-of-work resolution. Bitcoin Gold, on the other hand, uses the Equihash PoW algorithm, which cannot be solved using ASICs that were designed for Bitcoin. This ensures that Bitcoin Gold is not in competition with Bitcoin over limited resources. Instead, Bitcoin Gold will have an entirely different mining infrastructure made up of general purpose hardware (GPUs).
Which wallet should I keep my BTC to make sure I get my free BTG?
Any secure Bitcoin wallet that gives the user exclusive control of cryptographic private keys is a suitable place to store your coins before the October 25 fork. Some wallets may offer direct access to your BTG, while others may require you to take additional technical steps. Verified wallets that support BTC and BTG side by side will be listed on the Bitcoin Gold homepage. We will publish guides to recover BTG from the most popular wallets including Bitcoin Core, Electrum, Mycelium, hardware wallets, paper wallets and more.
How do I mine Bitcoin Gold?
You can mine BTG alone using the full node client or you can mine with a pool. Some public mining pools that have worked with us are listed on our homepage. We invite you to join our #mining Slack channel for technical help and advice on mining BTG.
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