3 big parts of Bitcoin (Learn Bitcoin)

Learn Bitcoin simply when you break it into 3 parts.

Blockchain

The blockchain is simple when you compare it to a ledger. Each block of the blockchain is like a page in a ledger. A new block is created about every 10 minute including new transactions, and a complex reference number attaching it to the last block.

Miners

Miners are the backbone of the bitcoin community, not only do they keep the Blockchain secure, they also serve as a fair distribution of bitcoins. Mining is something anyone with computer processing power and internet can do. It is a free application that calculates hashes repeatedly until it solves a complex math problem. The difficulty of the problem changes every 2016 block so that the average amount of time for a block generation stays around 10 minutes, no matter how much mining is going on. The miner who solves a given block is rewarded a small amount of bitcoins, along with any transactions fee’s that might be included in the transactions. The amount of bitcoins that are awarded each block decreases by half every 4 years, until sometime 2140 when they will be all mined up.

 

Cryptography SHA-256 is your Bitcoin wallet.

Modern cryptography allows you to own and send bitcoins, through a private key and a public key. The public key is 32 numbers and letters starting with 1 or 3. Often you will see this as a QR code for easy scanning. This is what you use to check your balance and have money sent to your account. The Private key is a file that contains a complex signature that proves you own your wallet, and allows you to send bitcoins to a different wallet. You need to keep this safe and always secure it with a good password. If someone has your private key they can spend your bitcoins.