Bitcoin Network is a peer-to-peer network that is operated through cryptographic protocols. Users use Bitcoin Cryptocarbon Wallet software and transmit bitcoins through digital messaging using the messaging system. Transactions are recorded in a distributed, reprinted public database known as Blockacain, and consolidation is achieved in the proof of mining proof of work protocols. Bitcoin Designer Satoshi Nakamoto claimed that the design and coding of Bitcoin began in 2007. The project was released in 2009 as open source software .
The Bitcoin network requires a minimal framework for sharing transactions. A special-decentralized network of volunteers is enough for that. Messages are promoted on the basis of maximum effort. Nodes can opt out of the network as desired, can be re-connected. After reconnection, a node can verify and download new blocks of other nodes to complete the local copy of Blockchain.
#Transaction - A bitcoin can be expressed as a sequence of transactions signed in a digital way, which starts from the birth of the bits of coins as a prize of the block. Bitcoin owners are required to hand over Bitcoin to the next owner by signing a digital signature in the Bitcoin transaction system, to authorize bank checks in general terms. One recipient can check each transaction previously for chain chain ownership verification. However, bit checks like the general check approval are not reversible, due to which the risk of chargaback fraud is eliminated.
Although it is possible to manage each bitcane separately, but it requires a different transaction for each bitcane in any transaction, it becomes a complex process. Therefore, there may be multiple inputs and outputs in one transaction, so that bitcoin can be separated or even merged. In general transactions, there will be a single input from a previously traded transaction or there may be several inputs in the form of small transactions in the previous one. And the output will be two - one for the payment, the other to send the retail money (if needed) to the sender. The difference between the transaction's input and the total amount of the quantity goes as a transaction fee to miners.
#Mining- Bitcoin uses a "proof of work network" to create a distributed timestamp server as a peer-to-peer network. This work is often called Bitcoin Mining. The signature is not available, but the signature is found out. This process is intensely related to energy. More than 90 percent of the total expenditure is spent on electricity for miner management. In order to operate an information center established in China for Bitcoin Mining, maximum capacity is up to 135 megawatts.
The original invention of Satoshi Naakamoto was the need to prove proof of work to provide signature for Blockchain. There is a block in the mining process, which provides a smaller number than the target of the given difficulty when hash twice with the SHA-256. Where the required average amount of work increases in the opposite proportion of the target of the target, then a hash can be verified by launching a round dual SHA-2556.
Bitcoin can be found to be valid for a timestamp network by increasing the value of any number of times it can be used. As long as the value of the required number of non-zero bits for the hash of the block is not available, the value of the number is increased till then. Once the hash process returns a valid result, the block can not be changed until the task is re-executed. Later when the blocks are chained with it, the next one has to work again to change the blocks.
Most consensus is expressed in bitcoin with the largest chain, and the maximum effort is required to create this chain. If the majority of the power measurements are controlled by the proper node, then the number of honest chains will also increase rapidly and it will surpass any competitive chain. To change any of the previous blocks, an attacker has to repeat the evidence part of the block and all the subsequent blocks and print the work of a good node. As soon as the block is added, the likelihood of being able to keep pace with an aggressive attacker decreases exponentially.
#Difficulty - Bitcoin mining is a competitive endeavor. A kind of "best weapon-winning competition" was seen through various hashing technologies used in Bitcoin mines. In many gaming computers, FPGA and ASIC, common CPUs, the use of higher GPUs reduces the profitability of the little specialized technology. Special ASIC for Bitcoin has now become a basic way for bitcoin mining and the drop in GPU has exceeded 300 times. Since mitigation of bit coins has become more difficult, computer hardware manufacturers are seeing increased sales of high speed ASIC products.
The computer power is often gathered or deposited ("pooled") to minimize the difference between income from miner. Each mining rig has to wait a long time to ensure transactions and payments made. When the participating server can solve a block every time, all miners participating in a pool pay the money. This money is given based on the amount of work done by each miner to find that block. Bitcoin data centers generally spread out of the public eye and spread around the world, and there is also the tendency of having centers around the areas around low-cost electricity.
#Power consumption - In 2013, Mark Gimin calculated that the cost of electricity could be 40.9 megawatts (982 megawatt-hours a day). In 2014, according to Hac McCack, the cost was 80.7 megawatts (80,666 kilowatt). In 2015, according to the Economist, if all miners use modern facilities, then the combined electricity costs can be 166.7 megawatts (1.46 terawatt-hours per year).
To reduce costs, Bitcoin mines have been placed in places like Iceland where geothermal energy is cheap and free of cold polar air free. Chinese Bitcoin Miners use Tibet's hydroelectric power to reduce electricity costs.
#Security - Its practical or theoretical use has been considered as a possible attack and payment method in the Bitcoyan network. There are some features of the Bitcoin Protocol that can prevent unintended attacks like unauthorized costs, double costs, bitcoin fraud and blockchain tempering. Users need considerable alerts in other attacks, such as stealing personal keys.
#Unauthorized expenditure - With the implementation of public-private key cryptography, the amount of unauthorized expenditure can be reduced. For example, when Elise sends Bitcoin to Bob, Bob is the new owner of Bitcoin. If someone named Eve name sees the transaction, he might want to spend the bits received by Bob, but he can not sign the transaction if he does not know what the private person is.
#Dual expenditure - The problem that must be resolved on Internet payment systems is "dual expenditure", where a user gives the same bitcate to two or more customers. For example, such a problem will be created if Eve sends the same bitkayena first alice and later sends Bob. To protect against double expenditure, the Bitcoin Network records all Bitcoin transactions in an account (Blockchain) which is visible to all users and ensures that the transaction bits have never been used before.
#Race Attack - If Eve gives Elise the money in exchange for a product and sign contracts for the transaction, at the same time it can arrange for the same bitcoin to send to Bob. According to the rules, the network will only accept a transaction. This is called a "race attack", because there is a race competition about which transactions will be accepted earlier. Alice can reduce the risk of race attack by imposing this condition of the contract, that unless the eve payment is made visible in Blockchain, she will not be able to supply the product.
A miner is needed in a different race attack (which is called the Finni attack according to the fast-paced rear). Instead of sending a request for a refund to both the network (Bob and Alice with the same coin), the Eve network only asks for the payment of Alice to the network, but at the same time trying to milele a block that includes Bob's payment instead of Alice. There is a good chance that before Alice's payment can be rejected by the fraudulent miner network, it will make its own disadvantages. Alice can reduce the risk of a fundamental attack like a normal race attack while waiting for your payment to be included in Blockquenne.
#Change history - There is a block containing transaction information given at the beginning of each block added to Blockchain which is called the approval of that transaction. In the typical case, before accepting the payment, the business and services that accept payment through Bitcoin should wait for at least one authorization distributed on the network. If a trader waits for more approval, it is difficult for an attacker to reverse the blockchain transaction - unless the attacker brings more than half of the total network capacity, ie 51% attacks.
#Clients diayanonimaijesana - For data mining, deanimation is such a technique to reconstruct the anonymous data sources that the anonymous data is matched to other data sources. In addition to the transaction graph analysis (which may reveal connections between Bitcoin's pseudonymous addresses) as well as an attack that may link the user's pseudonym to its IP address. If the peer connection is using "tor", it is attacked in a way that peer connections are disconnected from the Tor network, then forced to use their actual IP address for any subsequent transaction. Such attacks may also misuse Bitcoin's peer address and anti-dose protection transmission mechanism. Costs less than € 1500 per month to attack on a complete Bitcoin network.
#Payment Verification - You can define every miner in a block that will not contain any transactions. The number of transactions in a block is not equal to the higher level of computational power needed to solve the block.
After receiving a new transaction information, a node must verify it; Especially the transaction has to be sure that no input has been spent before. Then we need to check the nodes needed to access the blockchain. If a user can not rely on neighbors of his network, he must keep a complete copy of the blockchain, so that any input can be verified.
As the white paper in Nakamatu is written - it is possible to verify the Bitcoin payment (which is called simplified payment verification) without a full network node. In this process, only one copy of the longest chain block headers of a user is available - the network node search is available until it receives the longest chain. The mercklays branch is then attached to the fixed block link. In relation to linking transactions in any of the channels, it is understood that the network node has accepted it, and the added blocks are further guaranteed.
#Blakaceinera data - It is possible to save any digital file in BlockChain - the size of the transaction is as large, the associated fee is more. Various types of content - Child pornography from URL, ASCII art image of Ben Bernanke, Content of WikiLeaks cable, Bitcoin can be funded by miner's prayers and original Bitcoin white paper.
Criminal activity - The use of Bitcoin for criminals has attracted the attention of the regulator, lawmaker and enforcement agencies and the media. In this regard, the FBI has created an intelligence assessment, SEC has issued a warning message about the investment process using the virtual currency, and in the US Senate in November 2013, a hearing on virtual currency was held.
Several news organizations have claimed that with the increase in popularity of Bitcoin, opportunities for purchasing illegal goods have also increased. In 2014, researchers from the University of Kentucky found strong evidence that "the encouragement and illegal activities of computer programming increased the attractiveness of Bitcoin." They found limited or zero support for the use of Bitcoin for political and investment purposes. . "
#Black Market - According to a CmU researcher, in 2012, 4.5% to 9% of the drug trade in the world is operated on a single web drug market. Black marketplace sites have complaints of child pornography, mercenary killers and arms bits for sale. Because the sites are anonymous and due to lack of central control in this market, it becomes difficult to know whether these services are really real or bad bills.
Various authorities stopped black marketing of some deep web. In 2013, the US law enforcement agency closed Silk Road - this reduced the cost of bitcoin for a short time. In 2015, the founder of the site was sentenced to life imprisonment. But in a few days, alternative sites were available, that is why in the first half of 2014, the Australian Broadcasting Corporation reported that the closure of the Silk Road has made little impact on the online drug trade of Australians, but the amount of drug sales has increased. In early 2014, the Dutch authorities closed the online market of illegal goods, Utopia and confiscated 900 bits. At the end of 2014, at the end of a joint police campaign, the authorities of Europe and America confiscated many Bitcoins and closed 400 dip web sites, including the illegal goods market, Silk Road 2.0. This kind of act of law enforcement agencies resulted in the punishment of several offenders. In December 2014, Charlie Sharme was sentenced to two years in prison for indirect aid to send 1 million dollars to the drug trading site Silk Road. In February 2015, Silk Road founder Ross Woolbrich was convicted of drug trade - he was sentenced to life imprisonment.
Some black marketers may betray bittacense from customers. Bitcoin identified a site called Community Ship Marketplace as a fraud. After the site has been accused of stealing Bitcoin, the way to lift Bitcoin is blocked and closed. In a separate incident, in the first half of 2014, due to ownership of several black market patrons, Bitcoin escrow accounts were hacked.
According to a UK based charity organization, Internet Watch Foundation, Bitcoin is used in child pornography business, about 200 websites accept Bitcoin as a medium of payment. But Bitcoin is not the only means of child pornography online marketing. In this regard, O'Reilly, the Chief Trail of Europol's Cyber Crime Unit, said, "EuCash and Passhecord ... are also used to pay for such materials." However, the Internet Watch Foundation lists about 30 sites that only accept Bitcoin. Some of these sites have been closed, including a Crowdfunding website of Deep Web which aims to collect money for new child pornography. Furthermore, when transactions are done, the hyperlink of child porn website is added to Blockchain as a free database.
#Money Laundering - Bit coins may not be ideal for money laundering because all transactions are made publicly. Various authorities, such as the European Banking Authority, the FBI and the Finance Action Task Force of G Seven have expressed concern that beta coins may be used for money. In early 2014, the operator of the American Bitcoin Exchange, Charlie Shrim was arrested for money laundering. Later on, he was sentenced to two years in prison for "help and assistance in the payment of uninsured money." On July 25, 2010, BTC-e's so-called owner Alexander Viik was arrested in Greece for allegedly laundering $ 4 billion in money laundering and disobeying US law laundering laws. A report released by the UK Treasury and Home Office entitled "Money Laundering and Assessing the Risk of Terrorist Financing"
#Ponzi scheme - Between 2011 and 2012, a Ponzi scheme or a fraudulent scheme using bit queues promises to generate 7 lakh bits of coins by making promises to profit up to 7 percent a week. In July 2013, the US Securities and Exchange Commission accused the company and its founder of "cheating with investors in the PNG scheme of bit coins". In September 2014, Judge Bitcoen Savings and Trust and his owner fined $ 40 million.