What you need to know about "virtual currency" that is likely to enter the diffusion period finally Summary
Bitcoin (bit coin)Represented by "Cryptocurrency (Virtual currency)It is expected to become more and more popular and increasing importance in the future. About the virtual currency you do not know and know, first of all we should hold down that "What is virtual currency?"BlockgeeksIt is easy to summarize.
What is Cryptocurrency: Everything You Need To Know [Ultimate Guide]
Market capitalization of bit coin will record the highest ever in 2016Virtual currencies are becoming a global trend, such as. However, the virtual currency whose understanding is still not well understood is a creepy existence for many people, and as of the end of 2016, the opportunities to use the virtual currency in the real world are limited, most of them are just projects to be published in the thesis It is the present condition. Blockgeeks says that even bankers, consultants, scientists, even software developers do not have enough knowledge about virtual currency, and some people do not even understand basic concepts Thing. Under such circumstances, the basic knowledge to know in order to understand the virtual currency in preparation for the coming of the upcoming virtual currency era is as follows.
◆ History of the birth of virtual currency
It is not well known that virtual currency such as bit coin was born as a by-product of another invention. It still has the greatest achievement as a creator of bit coinTetsushi NakamotoHe did not invent the virtual currency itself. However, Nakamoto's idea supports the entire system of virtual currency.
Development of the remittance system of the digital world used by local governments in the 1990s was advanced, but all attempts failed. All of them are the mechanism that one core server manages the currency settlement system centrally and it is impossible to construct a system that will never be broken by currency service where the highest level of reliability is required There was, inevitably, the construction of the digital currency system could not be realized.
Nakamoto, who saw the centralized system fail, tried to build a digital currency system that does not use a central server. And it was used in the file sharing system to create a non-centralized system (distributed system)Peer-to-peer (P2P)I used. This decision was accompanied by technical complexity, but the philosophy that was lacking until now was found for the realization of the digital currency.
The most important thing in the digital currency settlement system is "prevention of double payment". Unlike real-world currencies, digital currencies that do not have physical media can be easily copied, so it is one of the big challenges how to secure security against double use of currency technically. Nakamoto's invented distributed system does not have a core server. Therefore, we were able to realize the reliability of the steel wall that can not be tampered with.
◆ Virtual currency system
In Nakamoto's idea, all the encryption used in the virtual currency system consists of a peer network. And all peers have a complete history of all transactions (balance record of all accounts). This history is a collection of files called "transactions" such as "Bob gave Alice BOX BTC", but all arePublic key cryptographyIt is encrypted in the system. The fact that transactions signed (encrypted) with the public key are delivered within the peer network themselves can be said to be an ordinary form without any special points as P2P.
Transactions are almost instantaneously grasped throughout the network, but they will be "confirmed" only after a certain period of time. This confirmation work is an important concept to ensure the reliability of the virtual currency. This checking operation is a task of confirming that the transaction has not been tampered, that is, confirming that the transaction has been done properly and not double-settled, and if confirmed, it is recorded in the ledger "Blockchain (block chain)" , It is fixed, it becomes no longer changeable.
Only "miner" (minor) can do the important "transaction confirmation work" in this virtual currency system. Minor confirms legitimate deal and stamps and spreads it throughout the network. When a transaction is confirmed by a minor, all nodes are added to the database, which is part of the block chain. This minor confirmation work supports the virtual currency system, and the minor system accepts tokens (generally virtual currency distribution) as compensation for confirmation work in all virtual currencies.
There are no entry restrictions on minor to provide machine power and receive tokens in return. Everyone is able to provide machine power and become a minor. However, since there is no authority to delegate confirmation work to the distributed network itself, a mechanism to prevent abuse by cryptic overtreading is required. Therefore, Nakamoto imposed a role of "Proof-of-Work (work proof)" that finds an encrypted hash that connects transactions and transactions to a minor to perform verification work. For example, with bit coinsSHA-256A hash excavation work by hash algorithm is adopted. A bit coin is created when the minor completes the decryption work of the virtual currency system and solves the cryptographic puzzle. This excavation work is a mechanism that increases difficulty as computer performance gets higher, and this prevents peers in the network from being broken.
For example of bit coin, the details of the virtual currency encryption system and the mechanism of the block chain are explained in detail in the following article.
Summary of things I would like to know to perfectly understand the virtual currency "Bitcoin" - GIGAZINE
In the end, the reliability of the virtual currency system is protected by strong encryption. In other words, the reliability of the system is guaranteed only by mathematics, not by human beings. In theory, the probability of tampering with the virtual currency system is kept strong enough to say that the probability of asteroid falling down to home is lower.
◆ Characteristics of Transaction
The transaction, which is the transaction history of the virtual currency, has the following five features. All these are grounds to support the safety and convenience of the settlement system of the virtual currency.
Transactions that are confirmed and recorded in the block chain can never be returned. Even if you send money to a scammer or if a hacker steals a virtual currency from a computer, nobody can help it. In other words, in the virtual currency world there is no heavy safety net like a credit card.
All virtual currency accounts and transactions are connected to someone in the real world. However, in the virtual currency usage scenario, we handle virtual currency such as bit coin in the form of random alphanumeric address of about 30 characters. It is possible to analyze the flow of the transaction itself, but it is impossible to connect to the user behind it. In other words, the anonymity of the transaction is guaranteed perfectly.
3: Fast and global
Transactions are propagated instantaneously into the peer network and confirmation work is completed in a few minutes. Transactions in virtual currency occur within the network and are indifferent as to where the trading entity of the virtual currency actually exists in the world. Remittance to people in front of you, remittance to people on the other side of the earth is exactly the same. In other words, it is the virtual currency that enables high-speed transactions on a global scale, and it is free from physical restrictions such as countries and regions.
The virtual currency is encrypted with the public key cryptosystem. In other words, only the owner of the secret key can decrypt the encryption, it is possible to use remittance processing and use the virtual currency. It is impossible to break a strong cryptosystem and a strong system of enormously large numbers.
In order to use virtual currency, you do not need to ask permission for someone or ask for a procedure. Using software that anyone can download for free, you can send and receive encrypted communication by yourself and virtual currency settlement is possible. In other words, it is impossible for someone to stop using virtual currency.
Dawn of new economy
In the virtual currency system which combines the above five features, no one needs permission, anyone can use the virtual currency anytime anywhere in the world and can not restore the transaction. As there is no institution with currency issuing authority, exchange operation such as controlling inflation / deflation is impossible and transaction price is determined by a balance between pure demand and supply, so the virtual currency is " The expression "gold" is perfect. Compared to worldwide standard gold, the virtual currency is still new and unstable, but the virtual currency shows solid traction and it is expected that the standardization for using the virtual currency will increase over the next few years It is.
A virtual currency, a revolutionary system similar to the existing financial system, has succeeded because of its innovation. For example, bit coins attract enthusiastic support, and there are also estimates that it is closer to religion than technology. The digital gold virtual currency is a safe financial asset that is not politically affected,British EU withdrawal problem (Brixit)YaDonald Trump elects the next president of the United StatesWe are attracting more people among the swells of worldwide politics, such as.
Virtual currencies that increase their presence are also becoming more attractive as speculation targets. Doubling or halving the market value in just one day can happen in virtual currency. In addition to the bit coin which is the representative of the virtual currency, the virtual currency which was born like the rice bamboo shoots steadily gathers support and increases the transaction volume.
The main virtual currencies as of the end of 2016 are arranged in order of transaction volume as follows. Bit coin is nothing less than 10 times less than the second place. The bit coin that started from the state with zero market value rises to 1 $ 650 (about 76,000 yen) 1 BTC after 7 years, and the transaction amount per day has grown to over 200,000 transactions per day.
In addition to bit coins, the number of hiring will increase in banksRipple, Sibling virtual currency based on bit coin represented as "silver" for "gold" bit coinLitecoin, We adopted the cryptonite algorithm to further enhance privacyMoneroIn addition to the current standard bit coin, a lot of virtual currencies are born.
The market of the virtual currency has only just begun, its movement is faster than imagined, and it is eliminated as the new virtual currency is born like every day. Investors from the beginning of the creation of the virtual currency, if the virtual currency develops, there is a possibility of getting a huge wealth, so many people will clump to a promising virtual currency, but after a few months There are few virtual currencies surviving in the world, and it is a fascinating world that the dead zombie virtual currency is spreading. Even bit coins that occupy the status of the standard at the present moment are not guaranteed to grow in the future, there is a good chance that they will be replaced by new virtual currencies. Either way, it is expected that only the continuation of virtual currency growth will continue after 2017.