Many people have heard of Bitcoin, but few are aware of its relationship with the blockchain. Bitcoin is a technology that stores and verifies transactions on the Bitcoin network using a network of thousands of computers.
What is a bitcoin?
It is a digital token that can be transferred through a computer or smartphone without an intermediate financial institution. This type of system removes the need for the usual banking network that acts as the middleman when two or more parties wish to transact.
While bitcoin is simple to transfer, its value is difficult to calculate. Peer-to-peer technology allows funds to be transferred directly between two people without the use of an intermediary. Bitcoins, like paper money, can be used to make electronic purchases or as investment vehicles.
What is Blockchain technology?
The Blockchain is the public ledger that records every transaction ever made on the network. Blockchain is the technology that underpins bitcoin. Soon, the Blockchain will continue to grow as “completed” blocks are added to it with a new set of recordings. Every ten minutes or so, a block including transactions is appended to the Blockchain through mining. The integrity and the chronological order of the Blockchain are enforced with cryptography.
Difference between Blockchain and Bitcoin?
We can say bitcoin is just one application of Blockchain technology, albeit the most popular one. Other applications are being developed by startups and established companies alike. Whereas Blockchain is an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way. It also enables an Internet of Value where money can be sent around the world in minutes without needing traditional financial institutions.
Difference between Bitcoin and other currencies?
One way in which bitcoin is different from other common currencies is that it is decentralized. No banks or governments are issuing new bitcoins, which means there’s no central authority to regulate them either. Some pundits suggest that this lack of central oversight on mining may make it easier for criminal organizations and other nefarious actors to use bitcoin. Still, others remain unconcerned, especially as governments’ track records in regulating cryptocurrencies continue to be disappointing.
At last, bitcoin is a type of cryptocurrency, whereas Blockchain is a type of distributed database. Please let us know if you want to learn more about Blockchain and bitcoin.
