Bitcoin

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Revision as of 09:53, 12 February 2020 by Bjorn (talk | contribs) (The Bitcoin Halving Process)
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What is Bitcoin:

Definition:
“Bitcoin is a non-debt based, irreversible, digital asset, with an intrinsic value in the security and inclusion of the payment system and decentralized governance structure that runs on a global transparent ledger on open networks like the Internet.”
 

  • Non-Debt Based, There is no lone connected, like a piece of Gold. The opposite would be value of paper money, not coins, is a lone paper form the central bank and digital money is a what the bank own or has lent you.
  • Irreversible, Once a transaction is done there is no going back. No one can delete a transaction, just create a new transaction to send the value back.
  • Digital asset, The thing (asset) is bits and bytes on a computer (digital) not physical.
  • Intrinsic, The Origin is a medical term, not a financial. It means you need something to get a function ex. you need a knee to bend your leg. In this case you need security, inclusion and agreed decentralized governance structure to get value.
  • Security, The strength of the system.
  • Inclusion, How many can take part in this system
  • Decentralized, no singe point of failure can stop or hurt the system in anyway.
  • Governance structure, Who is in charge, if anyone and what are the rules (law).
  • Transparent, anyone can see or look up all the information that is available for system.
  • Ledger, a record of all inputs / transactions.
     

Features

The features of Bitcoin are: The features organizations want:
Open Source Closed Source
Global Local
Immutable permanent ledger Editable ledger (for correcting slipups)
Permission-less (anyone can join) Permission (Only for verified customers)
Censorship resistant Censored (think about sending value to WikiLeaks)
Decentralized / Flat structure Centralized / Hierarchical structure
Pseudonymous Control Identity / KYC
Proof of work consensus Proof of Stake / PoAuthority / PoState
Innovate without permission Controlled team of innovators
This is Bitcoin. This is not Bitcoin
 
The Internet of money or IoM like IoT (Internet of things), a currency / value token that can buy gods and services globally using the Internet.
The value token network that runs on the Internet with sets or blocks of transaction data packaged and blocks are built on top of each other to locked them in sequential order.
Digital assets / money that is programmable and can be self regulated.
 
 

Bitcoin FAQ

  • Only 20 999 999,99755530 or less bitcoins will ever exist.
  • The consensus algorithm is Proof of Work SHA256 (Secure Hash Algorithm 256).
  • The lowest denomination of bitcoin is 1 Satoshi. There are 100 million Satoshi’s to every bitcoin. That is 8 numbers behind the coma, (1 Satoshi = 0,00000001 Bitcoin).
  • Bitcoin is run decentralized on a flat structure as opposed to a centralized hierarchical structure.
  • Bitcoin is design to be the senders “push transaction” and that no entity like banks, governments or 3rd party can stop a sender from pushing transaction to be executed. In effect the sender is the ultimate authority and decides who he or she pays value to.
  • The Bitcoin code has never been successfully hacked, but we have seen many examples of centralized wallets that have been broken into (Hacked).
  • The software is open sours and the code is available on GitHub.
  • The difficulty parameter, that is built into the software, is adjusted every 2016 blocks to change to try and keep a 10-minute block time on average based on the blockchain performance the last 2016 blocks.
  • Hashing is a brute-forced mechanism by the miners (supercomputers with ASIC CPU’s (Application Specific Integrated Circuits Central Processing Units)) guessing the right combination.
  • An executed SHA256 hash is one try to guess the right combination on the complex lock holding the blocks together.
    • Side note:
      • 1 guess = 1 hash
      • 1024 hash = 1 Kilohash
      • 1024 kilohash = 1 Megahash
      • 1024 Megahash = 1 Gigahash
      • 1024 Gigahash = 1 Terahash
      • 1024 Terahash = 1 Petahash
      • 1024 Petahash = 1 Exahash
  • The miners get rewarded for the blocks that they solve and broadcast to the rest of the network first.
  • Every 210.000 blocks the miner reward gets halved.
  • In the current bitcoin software, Bitcoin Core ver. 0.17.1 the block size limit is set to 1 Mbite of transaction data.
    • Many new proposals of software with larger block size have been set on the network backwards compatible with Bitcoin Core.
    • To change the current software (Hard fork) 75% of miners need to be mining on to the new software. At the time when 75% is reached, there will be "Grace period" of 1,209,600 second (two weeks) before the new features will be in effect and the Hard fork is completed. This acording to BIP0101.
       

Bitcoin History Facts

  • 1982, - David Chaum wrote a paper on eCash: "Blind Signatures for Untraceable Payments".
  • 1997, May - Adam Back invents Hashcash.
  • 1998, - Nick Sabo makes Bit Gold.
  • 1998, November - Wei Dai outlines B-Money.
  • 2004, - Hal Finney makes Reusable Proof of Work.
  • 2008, August 18th. at 01:19:55 PM - The domain name "Bitcoin.org" was registered.
  • 2008, October 31st. at 02:10:00 PM (EDT) Eastern Daylight Time - The "Bitcoin: A Peer-To-Peer Electronic Cash System" white paper surfaced.
  • 2008, November 09th. - The Bitcoin project was registered at the open-source-projects community resource, SourceForge.net.
  • 2009, January 03rd. at 06:15:05 PM - The Bitcoin blockchain started with the Genesis Block.
  • 2009, January 09th. at 02:54:25 AM - The Second Block, "Block #1" was added to the Bitcoin Blockchain.
  • 2009, January 09th. - Satoshi Nakamoto releases the Bitcoin Core v0,1 software for download on bitcoin.org .
  • 2009, January 11th. at 04:33:00 PM - Hal Finney twitted "Running bitcoin" which was the first-ever Bitcoin-related tweet.
  • 2009, January 12th. at 03:30:25 AM - The first Bitcoin transaction happened, other than mining, in "Block #170" for 10 Bitcoins from Satoshi Nakamoto to Hal Finney.
  • 2009, December 30th. at 06:11:04 AM - The first Blockchain difficulty change happened in "Block #32256". This happen after 15 potential difficulty changes before it. The actually change from 1 to 1.18, indicating that there were quite few maskings mining before this stage.
  • 2009, December 31st. at 11:59:59 - The Price of Bitcoin was $0,00 USD.
  • 2010, February 6th. - Bitcoin Market, the first official cryptocurrency stock exchange, is launched.
  • 2010, May 22nd. - First online purchase using bitcoin. Laszlo Hanyecz (indirectly) buys Papa John's pizza for 10,000 coins (25 USD – Bitcoin value was 0.0025 cents for 1 coin).
  • 2010, October 7th. - Bitcoin exchange rate begins to escalate, after several months stuck at USD $0.06 per BTC.
  • 2010, December 16th. - First block generated by mining pool under user sluch.
  • 2010, December 31st. at 11:59:59 - The Price of Bitcoin was $ 0,30 USD.
  • 2011, January - The Electronic Frontier Foundation (EEF), a non-profit group, started accepting bitcoins.
  • 2011, June - WikiLeaks and other organizations began to accept bitcoins for donations.
  • 2011, June 2nd. - USD to BTC rate is 10 USD to the coin. For 6 days, the Bitcoin value is fixed at 31.91 USD on MtGox.
  • 2011, December 31st. at 11:59:59 - The Price of Bitcoin was $ 4,60 USD.
  • 2012, November - WordPress had started accepting bitcoins.
  • 2012, November 28th. - The reward to miners halved to 25 bitcoins in "Block #210 000".
  • 2012, December 31st. at 11:59:59 - The Price of Bitcoin was $ 13,62 USD.
  • 2013, October - The FBI seized roughly 26,000 BTC from website Silk Road during the arrest of alleged owner Ross William Ulbricht.
  • 2013, October 31st.- The World first Bitcoin ATM (BTM) was open for business at WAVES Coffee House 900 Howe St. #100. Vancouver, BC V6Z 2M4 Canada.
  • 2013, November - The University of Nicosia announced that it would be accepting bitcoin as payment for tuition fees.
  • 2013, November 30th. - A Bitcoin All Time High as set, was set at $ 1 156,14 USD.
  • 2013, December 31st. at 11:59:59 - The Price of Bitcoin was $ 754,01 USD.
  • 2014, February - Mt. Gox had filed for bankruptcy protection in Japan amid reports that 744,000 bitcoins had been stolen.
  • 2014, December - Microsoft began to accept bitcoin to buy Xbox games and Windows software.
  • 2014, December 31st. at 11:59:59 - The Price of Bitcoin was $ 320,19 USD.
  • 2015, December 31st. at 11:59:59 - The Price of Bitcoin was $ 430,57 USD.
  • 2016, July 10th. - The reward to miners halved to 12,5 bitcoins in "Block #420 000".
  • 2016, December 31st. at 11:59:59 - The Price of Bitcoin was $ 963,74 USD.
  • 2017, February 09th. - The price of one bitcoin is approximately $1070, - USD roughly 8900, - NOK.
  • 2017, February 09th. - The Bitcoin Blockchain is running at approximately 4 ExaHash per second, that is 4.611.686.018.427.390.000 guesses per second.
  • 2017, August 01st. - The Bitcoin / Bitcoin Cash Hard fork in "Block #478 558".
  • 2017, December 17th. - The Bitcoin All Time High, at this moment, was set at $ 20 089,00 USD.
  • 2017, December 31st. at 11:59:59 - The Price of Bitcoin was $ 14 156,40 USD.
  • 2018, December 31st. at 11:59:59 - The Price of Bitcoin was $ 3 742,70 USD.
  • 2019, April 12th. - The Bitcoin Blockchain is running at approximately 47,68 ExaHash per second,that is 54.975.581.388.800.000.000 guesses per second.
  • 2019, September 18th. - The Bitcoin Blockchain is running at approximately 98,08 ExaHash per second, that is 113.083.380.034.552.000.000 guesses per second.
  • * 2020, May 25th. - The reward to miners halved to 6,25 bitcoins in "Block #630 000".
  • * 2024, February - The reward to miners halved to 3,125 bitcoins. in "Block #840 000".
  • * 2140, - All Bitcoins will have been mined and there are no more rewards, however the transaction fee will be incentive for the miners to continue.

( *=Estimated )Report errors or additions to b(a)mrbitcoin.no

The Bitcoin Halving Process

The halving happens every 210 000 Blocks
Block 0 (Genesis) to 209 999 the block reward was 50 Bitcoins per block. In total 10 500 000 bitcoins where generated from 2009-01-03 to 2012-11-28
Block 210 000 to 419 999 the block reward was 25 Bitcoins per block. In total 5 250 000 Bitcoins where generated from 2012-11-28 to 2016-07-09
Block 420 000 to 629 999 the block reward are 12,5 Bitcoins per block. In total 2 625 000 Bitcoins are generated from 2016-07-09 to estimated 2020-05-12
Block 630 000 to 839 999 the block reward will be 6,25 Bitcoins per block. In total 1 312 500 Bitcoins could be generated Estimated from 2020-05 to 2024-05
Block 840 000 to 1 049 999 the block reward will be 3,125 Bitcoins per block. In total 656 250 Bitcoins could be generated Estimated from 2024-05 to 2028-05
Block 1 050 000 to 1 259 999 the block reward will be 1,5625 Bitcoins per block. In total 328 125 Bitcoins could be generated Estimated from 2028-05 to 2032-04
Block 1 260 000 to 1 469 999 the block reward will be 0,78125 Bitcoins per block. In total 164 062,5 Bitcoins could be generated Estimated from 2032-04 to 2036-04
Block 1 470 000 to 1 679 999 the block reward will be 0,390625 Bitcoins per block. In total 82 031,25 Bitcoins could be generated Estimated from 2036-04 to 2040-04
Block 1 680 000 to 1 889 999 the block reward will be 0,1953125 Bitcoins per block. In total 41 015,625 Bitcoins could be generated Estimated from 2040-04 to 2044-03
Block 1 890 000 to 2 099 999 the block reward will be 0,09765625 Bitcoins per block. In total 20 507,8125 Bitcoins could be generated Estimated from 2044-03 to 2048-03
Block 2 100 000 to 2 309 999 the block reward will be 0,04882813 Bitcoins per block. In total 10 253,90625 Bitcoins could be generated Estimated from 2048-03 to 2052-03
Block 2 310 000 to 2 519 999 the block reward will be 0,02441406 Bitcoins per block. In total 5 126,953125 Bitcoins could be generated Estimated from 2052-03 to 2056-03
Block 2 520 000 to 2 729 999 the block reward will be 0,01220703 Bitcoins per block. In total 2 563,4765625 Bitcoins could be generated Estimated from 2056-03 to 2060-02
Block 2 730 000 to 2 939 999 the block reward will be 0,00610352 Bitcoins per block. In total 1 281,73828125 Bitcoins could be generated Estimated from 2060-02 to 2064-02
Block 2 940 000 to 3 149 999 the block reward will be 0,00305176 Bitcoins per block. In total 640,86914063 Bitcoins could be generated Estimated from 2064-02 to 2068-02
Block 3 150 000 to 3 359 999 the block reward will be 0,00152588 Bitcoins per block. In total 320,43457031 Bitcoins could be generated Estimated from 2068-02 to 2072-01
Block 3 360 000 to 3 569 999 the block reward will be 0,00076294 Bitcoins per block. In total 160,21728516 Bitcoins could be generated Estimated from 2072-01 to 2076-01
Block 3 570 000 to 3 779 999 the block reward will be 0,00038147 Bitcoins per block. In total 80,10864258 Bitcoins could be generated Estimated from 2076-01 to 2080-01
Block 3 780 000 to 3 989 999 the block reward will be 0,00019073 Bitcoins per block. In total 40,05432129 Bitcoins could be generated Estimated from 2080-01 to 2083-12
Block 3 990 000 to 4 199 999 the block reward will be 0,00009537 Bitcoins per block. In total 20,02716064 Bitcoins could be generated Estimated from 2083-12 to 2087-12
Block 4 200 000 to 4 409 999 the block reward will be 0,00004768 Bitcoins per block. In total 10,01358032 Bitcoins could be generated Estimated from 2087-12 to 2091-12
Block 4 410 000 to 4 619 999 the block reward will be 0,00002384 Bitcoins per block. In total 5,00679016 Bitcoins could be generated Estimated from 2091-12 to 2095-12
Block 4 620 000 to 4 829 999 the block reward will be 0,00001192 Bitcoins per block. In total 2,50339508 Bitcoins could be generated Estimated from 2095-12 to 2099-11
Block 4 830 000 to 5 039 999 the block reward will be 0,00000596 Bitcoins per block. In total 1,25169754 Bitcoins could be generated Estimated from 2099-11 to 2103-11
Block 5 040 000 to 5 249 999 the block reward will be 0,00000298 Bitcoins per block. In total 0,62584877 Bitcoins could be generated Estimated from 2103-11 to 2107-11
Block 5 250 000 to 5 459 999 the block reward will be 0,00000149 Bitcoins per block. In total 0,31292439 Bitcoins could be generated Estimated from 2107-11 to 2111-10
Block 5 460 000 to 5 669 999 the block reward will be 0,00000075 Bitcoins per block. In total 0,15646219 Bitcoins could be generated Estimated from 2111-10 to 2115-10
Block 5 670 000 to 5 879 999 the block reward will be 0,00000037 Bitcoins per block. In total 0,07823110 Bitcoins could be generated Estimated from 2115-10 to 2119-10
Block 5 880 000 to 6 089 999 the block reward will be 0,00000019 Bitcoins per block. In total 0,03911555 Bitcoins could be generated Estimated from 2119-10 to 2123-09
Block 6 090 000 to 6 299 999 the block reward will be 0,00000009 Bitcoins per block. In total 0,01955777 Bitcoins could be generated Estimated from 2123-09 to 2127-09
Block 6 300 000 to 6 509 999 the block reward will be 0,00000005 Bitcoins per block. In total 0,00977889 Bitcoins could be generated Estimated from 2127-09 to 2131-09
Block 6 510 000 to 6 719 999 the block reward will be 0,00000002 Bitcoins per block. In total 0,00488944 Bitcoins could be generated Estimated from 2131-09 to 2135-09
Block 6 720 000 to 6 929 999 the block reward will be 0,00000001 Bitcoins per block. In total 0,00244472 Bitcoins could be generated Estimated from 2135-09 to 2139-08
Block 6 930 000 and onwards the block reward will be 0 Bitcoins per block. Estimated from august 2139 on wards
In total, all block rewards will equal 20 999 999,99755530 Bitcoins, almost 21 million

Follow the countdown to the next halving here on Bitcoin Block Reward Halving Countdown

First vertion of Bitcoin.org

Bitcoin.org ver1.png


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