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Ultimate Guide For Crypto Concepts : Bitcoin, Ethereum

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In the 21st Century, Cryptocurrencies has become a Global phenomenon while still somehow it’s been difficult for many people to understand it thoroughly. This blog offers you a walk through and provides you a better understanding and overview of important Crypto Concepts like Bitcoin, Ethereum, Blockchain.

An overview of Bitcoin:

Bitcoin, an innovative virtual currency which is known as the first decentralized & also partially anonymous currency built on cryptography & peer to peer networking. It’s a blockchain type protocol that let an easy & direct transfer between consumers and merchants. The govt. of any country has no authority over bitcoin, it regulated by the bitcoin users. So, the privacy of bitcoin users can’t even breach by the govt. In recent years, Bitcoin earned popularity for its liquidity, privacy, low transaction cost among the customers. The value of bitcoin relies on the policy of demand and supply.

Now, bitcoin marketers predicted that in the coming future it would be the most used & considered as an ideal transaction between buyers and sellers.

An overview of Satoshi:

Bitcoin, the first innovative digital currency in the world has a unit which is known as “Satoshi”. It is named after the inventor of Bitcoin, Satoshi Nakamoto, whose real identity is unknown to us. Satoshi is the smallest unit of the bitcoin currency. It is a one hundred millionth of a single bitcoin (0.00000001BTC)

What is Blockchain?

The Blockchain is known as a digital, decentralized ledger which is built on cryptography & peer to peer networking. It keeps a complete record of cryptocurrency transactions. Most importantly, it allows market contributors an easy & direct asset transfer without any intervention of the third party. Basically, it is designed to authorize and transfer the cryptocurrencies such as Bitcoin, Ripple, IOTA, Darkcoin, Litecoin, Tether and Ethereum in a secure, low cost & efficient way.

An overview of Ethereum:

Ethereum is an open source, decentralized blockchain platform which features smart scripting functionality.
In 2015, Ethereum was founded by Vitalik Buterin. He had a strong will & vision to build a decentralized cryptocurrency like bitcoin, but with an additional feature where the decentralized applications can also be created on this Ethereum blockchain. It gives the users complete control over their own data.
It also allows the developers and designers to store the registers of debts, to build markets and move funds without risk. With it, anyone can easily design their own cryptocurrency. It made possible to build –

  • Puzzle-based cryptocurrency
  • Complex smart contracts.
  • Tradable token
  • Decentralized autonomous organizations
  • Decentralized autonomous apps.

ICO

Initial Coin Offering is the full form of ICO. It is used by startups to bypass the rigorous and regulated capital-raising process required by venture capitalists or banks.

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Bounty

Bounty is a simple term where a company/coin developer provides you some rewards, in return, you have to do some simple tasks for them. If you are wondering, what you need to do in return. Then let me tell you, the jobs are super easy.

Some examples of these tasks are:

  • Post on Facebook, Twitter or LinkedIn.
  • Make a blog post.
  • Join a forum.
  • Create a logo.

So, basically, you just need to promote their coin/service.

ERC20 Standard

The full form of ERC20 is “Ethereum Request for Comments”. This technical specification is responsible for planning or recommending improvements. ERC20 token standard explains the terms of the common laws that every Ethereum token needs to follow.
In programming terms, ethereum provides an interface that you can implement in your smart contract solidity file.

Ethereum units

Ethereum possesses a metric method of denominations which are known as units of ether. Each denomination owns a particular name. The smallest one is known as Wei. There are a list of denominations are known as unique names such as Kwei (babbage), Mwei (lovelace), Gwei (shannon), microether (szabo) and milliether (finney).

Smart Contracts

Smart contracts are software programs which are designed to assist you to securely exchange anything valuable in a secure way without the intervention of a middleman. Let’s have a look at the example:

Example:
Maria rents an apartment from rhea. Maria is planning to pay the rent through her bank. For the payment process, now she has to trust her bank for the transaction. She has to hope, it doesn’t steal her money or didn’t get hacked. So, the complete process does not look secure.

Instead of it, in the blockchain, Maria can directly send the money to Rhea. Once the transaction is done, the information would be updated. Everyone in the network including Maria and Rhea can see the money. It would be completely secure, no third party needed for the transaction. Even if any hacker tries to hack the computer, he has to hack all the computer in the network which is basically impossible.

The creation procedure of small contract can be finished easily right on the website using ethereum platform. On the top of your desired website, you have to look for ‘Deploy new contract’. After clicking it, you will be offered to finish the further procedure “an agreement of future contract” by this platform. The four factors of your future contract are:

  • Start block: Like other platforms, to create ICO on Ethereum platform, you have to select a block. At the starting point of the contract, the sale of token begins.
  • End block: End block implied conclusion block. At this moment, you stop issuing tokens
  • ‘Rate’: It will decide the exchanging rate of ethers & startup tokens.

GAS and when is GAS consumed?

Gas is a unit which costs to complete a transaction or action on the ethereum platform. Gas is like the diesel or petrol for your vehicle. The way your car needs diesel or petrol to perform, “gas” also need to be paid for the mining nodes.

On Ethereum networking, gas limit is a restriction where the consumer sets a fixed amount of ETH so that they can avoid overspending. It’s like if your car needs 10-gallon diesel for 10-mile driving, in the same way, to perform 10 lines of codes on the Ethereum networking, it needs 10 gas units.

Whitepaper

A Whitepaper is a report where the new cryptocurrency startup project writes about their new venture plan. Here the firm/ company discusses-

  • An overview of new venture & its mission goal.
  • How much budget needs to start this project, what sort of currency will be accepted.
  • The time duration of ICO campaign.
  • Team members of the project.

Public Key & Private Key

When a user creates his first transaction in his account, two significant tools, public key & private key, are created to secure the user’s holding.
A Public key is used as a cryptographic code to safeguard the security of the users. It let the users accept cryptocurrency safely.

Private Key is a top-secret number which is known to the user only. It lets the user do any transaction they want. The user always keeps it very securely.

Altcoins

Altcoins are the innovative virtual currency which is quite similar to bitcoin. Let me tell you, bitcoin is not only cryptocurrency present on the market. There are hundreds of cryptocurrency available nowadays which are quite similar to bitcoin but has their own distinct feature & functionalities. They are known as altcoins. Many people think that altcoin is a term of cryptocurrency, but it’s not true. Basically, it suggests any cryptocurrency which is not a bitcoin. Some examples of altcoins are Ripple, IOTA, Darkcoin, Litecoin, Tether, and Ethereum.

Wallet

A wallet is a public address which is used to send or receive cryptocurrency. The wallet has a public address which can be viewed by anyone, and a private key which should not be kept secret. A wallet can also be used to receive fund from venture capitalists, Cryptocurrency platform requires a wallet as most of the investors feel comfortable to contribute in ICO through it. Coinbase is a popular example of a crypto wallet.

Node

A node is an active blockchain network which contributes to the peer-to-peer network by processing transactions and blocks. All interactions with the blockchain, eg: smart contracts, are done via node. You can setup your own node or use ethereum network such as ropsten (sandbox) and mainnet (production) to run your blockchain applications.

P2P

P2P which means peer-to-peer networking. It lets the market participants’ trade directly without any intervention of the third party.

Mining

Mining is proof of cryptocurrency transactions. It is also known by various names such as crypto coin mining cryptocurrency mining, bitcoin mining or altcoin mining.

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Siddhesh Deshpande

Siddhesh is an efficient blockchain developer at Webs Optimization Software Solution. Being soft spoken in nature, his perfection and dedication in work would speak for him louder. He is a stellar blockchain developer with in-depth knowledge of each crypto concepts. One would always find Siddhesh enthusiastic to learn new technologies and utilizing his abilities to provide successful solutions.

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