When a transaction happens, it is known almost immediately by the entire network. Only after a specific amount of time, however, does the transaction get confirmed. The confirmation is the critical concept when it comes to cryptocurrencies. As a matter of fact, you could say that they are all about the aspect of confirmation.
So long as a transaction is unconfirmed, it is considered to be pending and can be forged. When it is finally confirmed, it is set in stone and is no longer forgeable. This means that it can’t be reversed and is part of an immutable record of transactions, also known as the blockchain.
Being able to submit cryptocurrency guest blog posts means that you speak as an authority on a burgeoning marketplace. But how can you speak authoritatively about something if you aren’t familiar with it yourself?
Understanding cryptocurrency, not just Bitcoin, is essential if you aim to be that voice of authority on a growing market. Knowing the essentials of cryptocurrency can help you be as prepared as possible to speak from a knowledgeable perspective.
What is Cryptocurrency Mining?
In theory, everyone can be a miner. Since there is no decentralized authority to delegate the task, cryptocurrency needs to have a mechanism in place to prevent one singular party from abusing it. If one person could create thousands of peers and spread forged transactions, it would destroy the entire system.
The idea is to create a product of a cryptographic function that connects the new block with its predecessor. This is known as Proof-of-Work and is an essential function in the blockchain theory of functioning.
Essentially, the algorithm used by Bitcoin and other companies is a sort of cryptologic puzzle that miners compete to solve. When they find a solution, they essentially build a block and then add it to the blockchian. The incentive here is that the miners get to add coinbase transactions (Bitcoins, likely) to their accounts.
This is only done if that cryptographic puzzle is solved by the miner. This all depends on the specific amount of cryptocurrency token that is created in a given time and is how a peer-to-peer network functions.
Refinement and ease of use need to be implemented in order to make cryptocurrency more of a universal thing for everyone to use, but the potential is there and Bitcoin has only begun to scratch the surface of what cryptocurrencies can do.