Bitcoin is one of the most innovative payment methods that has achieved substantial success due to its decentralized blockchain technology. Even though there are other factors that have triggered the success of Bitcoin still, the platform, for the most part, is one of the main reasons why it has achieved longevity, and it is widely used across many sectors today. Here we explore the main aspects of Bitcoin as a platform and the benefits it offers to its users.
Blockchain Technology
Bitcoin operates on a peer-to-peer-based, distributed blockchain network without the influence of any central authority or bank. The BTC transactions are jointly managed by the miners, which are users of the network that are bestowed with the responsibility of processing, approving blocks of BTC transactions. The mining process simultaneously produces new BTC in the network.
The design of the blockchain network is publicly available, and no one owns or can own and control the platform. This is the first payment system to have this kind of success thanks to its unique characteristics and decentralized design. The blockchain network is defined as an open, distributed ledger where the transactions are stored and recorded, and linked using cryptography. Some of the essential components of the platform are smart contracts, proof of work, and mining.
Smart Contracts
This is a crucial part of the blockchain network. A smart contract is defined as a computer program that automatically executes and controls certain actions and events. Based on the lines of code written into the protocol, smart contracts pre-determine the execution of the BTC transactions between the buyer and the seller in the blockchain network.
Otherwise, the BTC transactions are irreversible, secure, and completely transparent in the blockchain network. The timeline of the transactions as well their information is available to every user, and the miners have a clear preview of the real-time entries in the network. Because the BTC transactions are based on smart contracts, there is no need for any central authority to process them.
For example, the Bitcoin Billionaire is an automated trading system that automatically buys and sells BTC for its users, and you can potentially earn huge daily returns here. The minimum deposit is $250, whereas you can earn a daily profit of up to 80% on the site. Plus, there is a comprehensive trading guide for the members on the platform. In addition, the site is adapted to mobile devices, and you can trade on the go.
Proof of Work
Proof of work is another very important part of the blockchain network that is also replicated by other cryptocurrencies. It solves the double-spending problem, which represents the problem of spending the same BTC more than once in a transaction. However, Nakamoto resolved this problem when it is introduced proof of work in the mining process.
More specifically, when the miners find the block of transactions, and then they approve the block, they also need to solve a complex numeric puzzle that proves that this is a valid block of transactions.
Bitcoin Halving
Bitcoin halving is another protocol that really helped with the popularisation of Bitcoin and the platform. This event was designed by Nakamoto to reduce the number of BTC in circulation, and it cuts in half the quantity of BTC being produced by the miners every four years or whenever the threshold of 210,000 blocks is achieved.
By halving the number of new BTC, it minimizes the current supply, and with that, it triggers the bull cycles of the cryptocurrency when the demand is increasing at a pace faster than the supply. So today, thanks to the halving, which happened in 2020, and it had reduced the block reward to 6.25 BTC, there is an incredible bull market phase. Actually, a lot of investors are happy that the price surpassed $60,000 in March 2021 as a result of this bull cycle.
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