Summary of things I would like to know to perfectly understand the virtual currency "Bitcoin"

ByJason Benjamin

Virtual currency "Bitcoin (bit coin)"ofI have already summarized the conceptHowever, it is a fact that it is difficult to imagine the innovation and true value of bit coins simply by understanding the concept. In order to understand more deeply about "What is bit coin?"Blockchain (block chain)Understanding about "is indispensable. Understanding that "block chains are bit coins" understands bit coins as well. The second summary "Understanding bit coins" is from the following.

Tinkercoin Blog | Bitcoin 101

Block chain
Bit coin isP2PThe system is maintained with the mechanism that there is no central organization that operates the bit coin system. Instead of central organization "Bitcoin-QtInstalling software called "bit coin client" The bit coin network is maintained by the computer resources of people all over the world. Computers with bit coin client installed are constantly updating certain data by communicating with each other through the network. That data is "Block chain"This is what is called bit coin itself is not an exaggeration.


Block chain alreadyMiningIt is a "bit coin transaction record" which recorded all of the bit coin exchanges that existed in the world as it was mined (mined). A bit coin is registered in the block chain when it is born by mining, and then it is transmitted by a transaction, and its history is recorded in the block chain each time the owner changes. In other words, by looking at the block chain, you can see who sent the bit coin to whom. Tracing this history supports the reliability of bit coins. Every time a bit coin increases, the contents of the block chain are rewritten each time a transaction is made, and its data size is now about 9 GB.

This is an image of the bit coin transaction recorded in the block chain. From the top "Ross handed out three bit coins (3 BTC) to Gareth" "John gave 1 BTC to Gareth" "Gareth handed 2 BTC to Ross" was recorded It is.

If Gareth does not possess a bit coin before this transaction, "Gareth currently has 3 + 1-2 = 2 BTC", this content is recorded in the block chain That means that. And, if anyone can see this block chain, it means that you can check the history of who owns the bit coin at the moment, the history of who has moved the bit coin from whom To do. And the bit chain coin block chain is released so that anyone in the world can easily see it.

Of course, Mr. Gareth, Ross, John who are listed here is only a parable, and it is represented by a unique character string (for example, "1 tinKeRXU 3 Um 35 ar 884 Rq Raep Qeux X 9 R 6") in an actual block chain,It is impossible to identify who the bit coin owner isis. However, it can only be distinguished from others as owner of 1 tinKeRXU3Um35ar884RqRaepQeuxX9R6 bit coin address. This means "anonymity of bit coin".

Understanding the mechanism of block chains that support such bit coins clearly shows that concepts such as "bit coin" and "bit coin" do not have any meaning. Bit coins do not have a unique "coin", only the total amount of bit coins is in the block chain. And the power balance of who owns the share and the history of the change in its power balance are only recorded in the block chain.Having a bit coin means recording the bit coin address unique to the block chain and its own holding rateIt is.

Encryption by secret key "signature"
If you can understand that bit coin = block chain, it is natural to think "can not fake a block chain to become a bit coin owner?" But this is impossible. Block chains can not be tampered with. This is the birth parent of bit coin "Tetsushi NakamotoIt is an innovative invention.

For bit coins, in order to realize strong securityPublic key cryptographyThe technology is adopted. In public key cryptosystem, only a person with a secret key can decrypt the encryption, but bit coin adopts public key cryptography technology for "signing" behavior in the block chain.

This represents the transaction history in the block chain. The meaning of the contents of "Transaction 25 (25 th processing)" is as follows.

The person who sent the bit coin at Transaction (the 24th process) is the signature of this "John B" (John).

John sent a bit coin to someone named Gareth. That signature of Gareth is "Gareth MacLeod".

That is, Transaction 25 states that "John sent a bit coin to Mr. Gareth (the bit coin moved from John to Gareth)".

And in the next Transaction 26, if Gareth sends a bit coin to Ross, such a record will be made. In this way, the "signature" of the bit coin owner is recorded on the block chain, and the block chain is rewritten only when the signature matches.

If someone tries to record the lie's transaction using the lie signature in the block chain, if the signature already in the block chain does not match, the contents will not be rewritten.

And, to this block chainSignature acts can only be done by a person with a private keyIt is structured as a system. This means that only those with private keys can rewrite block chains, that is, they can send bit coins to others. In other words, having a bit coin's secret key means holding a bit coin,It proves that only the fact that I have a private key is a bit coin ownerThat's why.

The secret key of the bit coin is a character string similar to the bit coin address (for example, "5 Kb 8 k L f 9 z g W Q nogid D a 76 M z P L 6 T s Z Z Y 36 h W X M s S n N Y Y Y B 9 KF") and it can also be a QR code. But carelesslyBit coin will be stolen if the secret key is released on TV etcIt will be useless.

Case where Bitcoin's QR code is imaged on TV immediately happens to be stolen - GIGAZINE

Bit coin wallet
In order to trade with bit coin, we found that bit coin address and secret key are necessary. And since the bit coin address is published in the block chain, we could understand that only the secret key is necessary for trading with bit coin. Then, what you need to use bit coin is said to be "managed secret key".

I often hear that "bit coin has been stolen", but this means "the secret key has been stolen". A major exchange of broken bit coins "Mt.Gox"At the press conference, CEO Marc Calpress said," There are places where security is weak and bit coins disappeared (original mom) ", although the bit coin disappeared, it was not" no longer " , Meaning that the control of bit coin has been transferred to the person who got the secret key kept by hacking.

The fate of a bit coin needs to be managed as long as the secret key is held, but doing it is "Bit coin wallet"is.

ByBTC Trinkets .com

Although the bit coin wallet is the most simple one if it is a tool to record the secret key string, many bit coin wallets have the function of not only storing the secret key but also the function of clearing the bit coin It is. That is, it is possible to issue an instruction to rewrite the block chain.

The types of bit coin wallet are roughly divided into the following three types.

·Desktop wallet
A type that stores private keys on your local computer is called a "desktop wallet". Although it is named "desktop", you can manage not only desktop PCs but also mobile terminals such as smartphones yourself.

Actually, the software Bitcoin-Qt maintaining the bit coin system described above also fulfills the function as a bit coin official desktop wallet. However, it has the drawback of having to store about 9 GB of chain chains together, as a desktop wallet that does not require storage of block chains with improved this, "MultiBit"there is ........., ........., etc.

Desktop wallet has the merit of being able to completely control bit coin by itself, but it is necessary to be careful that the risk of losing secret key by hacking is always attached because it is connected to the network.

·Online Wallet
"Online wallet" lets the third party manage the bit coin secret key. It is a service of uploading bit coins on the cloud and entrusting management to third parties, which has the convenience of being able to conduct bit coin transactions regardless of location in environments where you can access the Internet. The service Mt.Gox was doing corresponds to this online wallet.

However, online wallet has a big problem of reliability because we leave important secret keys to the hands of third parties. It can be said that the risk of bit coins becoming "gone" is still hanging on.

·Paper wallet (cold wallet)
In order to reduce the risk of hacking damage to zero, there is no choice but to keep bit coins in a state of being blocked from the network. For example, if it is a primitive technique of "keeping the secret key of a bit coin on paper and keep it in the drawer of the desk", there is no possibility of bit coin being stolen by hacking. Such a thing is called "paper wallet". In addition, the wallet connected to the network is called "hot wallet", and in contrast the paper wallet is called "cold wallet".

Such a primitive storage method requires the trouble of entering a secret key each time a bit coin is dealt as a price to eliminate hacking risk. In addition, it takes time and effort to physically manage the paper wallet itself. Even if secret key data is stored in the hard disk to shut it off from the network,There is no difference in losing the bit coin if there is no hard diskIt is.

About 7.6 billion worth of hard disk saved Bitcoin is buried and missing - GIGAZINE

Future of bit coin
First, bit coins wrote that the system is running on P2P. This fact is becoming very important in fortifying the future of bit coins.

Bit coin system resources are covered by energy to mining using bit coin clients, and bit coins are planned to dig into all the 21 million BTC set by 2140.

"The simple question of how to maintain the system after the last bit coin has been digged?" Is called "transaction fee" prepared by bit coin The mechanism will solve it.

When sending a bit coin, it is calculated whether the transaction is made by a genuine signature or whether there is no mistake in the past history, so it takes time until the transaction is actually established and settlement is completed It is always. However, by paying the transaction fee, a mechanism that allows the calculation to be given priority, and those who want to make settlement quickly and surely can pay a transaction fee. The amount of this transaction fee can be decided by the person who performs the bit coin transaction by himself / herself.

Since this transaction fee is paid to the bit coin miner (mining person) who executed the calculation concerning the settlement first, it is thought that this fee is motivated and the bit coin system will be kept semi-permanently.


And with regard to the question "Are bit coins not crushed by power authorities such as the government?" Thanks to P2P and strong encryption,Virtually impossible to stop the systemFor exampleBitTorrentJust as it is difficult to crack down copyright infringement acts inThere is only measures to prohibit public transactions by lawIt can be said.

When the bit coin system collapses is when no one provides resources for maintaining the bit coin system, but it appears that a new virtual currency appealing more than bit coins appears and takes the lead role It may be time.

in Note,   Pick Up, Posted by darkhorse_log