Bitcoin Introduction / பிட்காயின் அறிமுகம் – Episode 1

 

Countless commenters asked to talk about Crypto Currency. If we want to talk about it, there are many things that we can cover. Some beings consider it as an resource and say that it should be part of your portfolio. Some other people say that it is just speculation, it has no value and simply that girls are pumping up the cost. The residue say that I don’t even have an opinion on this because I don’t know what it is. The intention of this sequence is to explain what Bitcoin is, how it succeeds, and why it is getting this much attention now.Not a financial suggestion. If we have a good understanding of this bitcoin, we should be able to make a decision whether we can participate in this or not. Hello Everyone. My name is Vijay Mohan. You are watching Investment Insights. Before looking into Bitcoin, tells’ check out the history of money that we are using Today. In olden days, there was Barter System. That is, a method in which people exchange rice for lentils or cow for colt. Then came Commodity Money idea. That is, commodities like golden or silver-tongued were transform into coppers and was used as currency. The special thing about this stock money is, it had an intrinsic ethic. No one can take away its appreciate. Because a gold coin is gold. A silver-tongued silver is silver-tongued. As it was not convenient to carry the commodities around as money for sales, a paper currency backed up by real merchandises was initiated. Eg: Like an ounce amber is one dollar was introduced. Now beings were able to use this paper currency easily in place of actual amber( stock ). Flexibility of exchanging that dollar for golden was also always there. Those were in olden days. Now we are using paper currency announced “Fiat currency”. You might ask what is that “Fiat currency”. “Fiat” in Latin signifies an official order issued by an official – “it shall be” or “let it be done”.Because currency nowadays are issued by Government authority, we are calling it as “Fiat Currency”. This fiat currency does not carry intrinsic value like stock money. Its cost collected from two sources. 1. Supply and Demand – the value of the currency comes from the demand of the currency. 2. Stability of the government issued the money. If the currency published by a stable government like US, it has more importance. But if the currency is issued by an shaky authority? – Zimbabwe has taught us that in the history. Money would lose its value so much that a loaf of bread will cost 10 Million Zimbabwean dollars. You might envisage, what is the need for the history of coin now. There is a reason. The chances of this cryptocurrency to be the next step in the history of money is increasing every day. Before rejecting this as speculation, when we look at the history of the money as a whole, we should be able to evaluate the chances of this crypto money forming it to the history of coin. And for that reason, we plastered the short-lived biography of money.We all know that Bitcoin has got the leading market share in crypto currency. Approximately 70%. So lets use Bitcoin as an example to understand how crypto currency undertakings. This excuse will be bit technological. But I will try my best to explain it in simple terms. Bitcoin works in a peer to peer structure. That is, numerous computers in a system acquire Bitcoin network. Any one can include their computer to this network. If I want to include my computer in the bitcoin structure, all I have to do is just install a application. Today, there are close to 100,000 computer nodes in bitcoin structure. Bitcoin network is run by common people like this. No one has any centralized dominion in this network. All computers in this network have same authority.All computers work together to make a decision. No computer can make any decision all by itself without depending on others in the network. Because the decision power is distributed across the network, Bitcoin is called as “Decentralized”. When fiat currency is controlled by the issued government, Bitcoin is controlled by its system. This is the firstly concept that we have to understand about bitcoin. We will see how it is controlled more in detail in next episode.Next thing we need to understand is “Transaction”. A transaction is just grant or take. If I refer 10 bitcoins to my friend, then it is a transaction. If that friend refers 5 of those received bitcoins to his friend, then it is another transaction. Any coin exchange like this becomes a transaction. A busines will have details on sender, receiver, and the amount. Just like a bank check. But a twisting in this one is, we will not envision the name of the sender or the receiver. There will precisely be ID’s. Altogether anonymous. If I want to send coin for a public motive anonymously, I can use bitcoin. No one can find out that it was me who sent the money.OK. Now we have created a transaction. What should we do now? What happens after we write a check? Whoever received the check, will situate it in their bank. The bank will treat the check, takes the money from the check columnist and monies it into receivers account. They will penetrate this deal in their ledger. Ledger is like our bank passbook. It is bank’s accounting record. All money that is coming in and going out will be in this ledger as deals. Bitcoin uses same perception as well. After creating a transaction, we should submit the transaction to bitcoin network just like depositing a check in the bank. Computers in bitcoin system will ratify this busines by confirming that all data is looking good and then accepts the transaction. These successfully consented transactions are entered into a block by bitcoin structure. “Block” is like a page in the ledger book.All valid deals will go into this block. So a block is nothing less than groupings of successfully treated deals. A block has approximately 2000 transactions. An important thing to note about these transaction is, that it is irreversible. That is, if a transaction is sent to bitcoin network and if it is accepted, then it cannot be changed back. It is like positioning in stone. Permanently recorded. That signifies, if we mail a bitcoin to a wrong party by mistake, then it cannot be taken back unless the receiver decides to give it back.Gone for good. That is why it is very important that the data is verified before submitting a transaction to the bitcoin network. OK. Now bitcoin network is filling a block with business. What is the case when that block is replenished? What does bank do when a page in record bible is filled with events? They will go to the next sheet. Same concept now as well. When a block is filled, bitcoin structure automatically organizes a brand-new block and links this new block to the previous block. As brand-new events are now in and blocks get crowded, new blocks are created and connected. How would it appear? It will look like a chain and stops giving like Hanuman’s tail.These associated blocks looking like a order is called “Block Chain”. Because of this continuous chain link, complete record of bitcoin is in this block chain. We should be able to see all details including, who are all viewed it and how many entrusts have it exchanged. That is all to a “Block Chain” Technology. A quantity of things in future could potentially be developed use this block bond technology. For speciman, if we kept the land ownership deed in a block bond, the history of the land ownership will be permanently in the block chain. No one would be able to cheat on that. Just like this, block series engineering has great potential in all the fields where storing permanent records is important. Now with this knowledge, if anyone talks about Block chain technology to you, you can comfortably take part in that conversation. So far we have seen that bitcoin toils thru the peer to peer computers connected in the bitcoin network. Each coin exchange is called as “Transaction”. Grouped transactions are called as “Block” The chain constituted by linking all the new blocks with the previous one is called “Block Chain”. That is all. Simple. In this episode “were having” flooded all the technical details to understand the bitcoin better. In the next bout, we will take a closer look on how bitcoin has grown since its “genesis block” introduced in 2009. If you like this episode, don’t forget to “Like” or “Share”.Thank You.

 

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