Do you think you know all about Bitcoin?
Don’t conclude yet until you have gone through the lessons in this Bitcoin Education tutorial.
There are Twelve (12) Lessons in all, each lesson contains both text and videos.
The text presents a summary while the videos give you better details in a very interesting and enjoyable manner.
The videos are short so it’s not tiring, boring or data consuming but very informative.
Enjoy…
Bitcoin Education Summary
The lessons include:
Click on the Lessons to view their content.
Let’s go do some learning!
LESSON 1: BITCOIN and bITCOIN
People usually confuse the 2.
Bitcoin (capital “B”) is an open-source software protocol that enables a blockchain to be built on a trusted peer-to-peer decentralized network on the internet.
This can be used to host a public database that tracks changes in the ownership of the assets and is secured by cryptography and consensus.
A bitcoin (lower case b) is a unit of digital currency that exists on the Bitcoin blockchain and is stored in a wallet (Coinbase, Ledger Nano X, etc.).
It can be used to track the exchange of value in a free market economy i.e you can buy anything with it where it is accepted.
There are several merchants accepting bitcoin because they know it is the future and they will also maximize their value.
In other words, merchants accept bitcoin because it is rising in value.
By the end of 2017, experts predicts that 1btc should equal $5,000.
So merchants make more money by accepting bitcoin.
Moving on to Lesson 2 now.
LESSON 2: Who Created BITCOIN?
Satoshi Nakamoto created Bitcoin.
This invention was published on 31st October 2008 to a cryptography mailing list in a research paper called “Bitcoin: A Peer-to-Peer Electronic Cash System”.
It was implemented as open-source code and released in January 2009.
He, She, or They were active in the development of bitcoin up until December 2010.
The first genesis block has a timestamp of 18:15:05 GMT on January 3, 2009.
No one knows who Nakamoto is. No one really knows who created the Bitcoin technology.
Nakamoto has claimed to be a man living in Japan, born around 1975.
However, it is believed that Nakamoto is a number of cryptography and computer science experts that are not Japanese, living in the United States and Europe.
One person, Australian programmer Craig Steven Wright, has claimed to be Nakamoto, though he has not yet offered proof of this.
As at 10 December 2016, Nakamoto owns roughly one million bitcoins.
Next in line is Lesson 3.
LESSON 3: The Blockchain
A blockchain is a public ledger of all Bitcoin transaction that has ever been executed.
It is constantly growing as ‘completed’ blocks are added to it with a new set of recordings.
The blocks are added to the blockchain in a linear, chronological order.
Each node gets a copy of the blockchain, which gets downloaded automatically upon joining the bitcoin network.
**A node is a computer for validating and relaying bitcoin information.
The blockchain has complete information about the addresses and their balances right from the genesis block to the most recently completed block.
A new block is completed every 10 mins.
No matter where the transaction takes place in the world, you can see it.
Keep on reading to discover what Lesson 4 has in stock.
LESSON 4: Decentralized Network
So to understand this, let’s look at a centralized network.
A centralized network would be something like a bank.
A bank is controlled by a corporation and government. They also have vulnerability because they have a central location where data is kept.
For example, if someone wants to rob a bank, he would walk in and take the money because it is in a bank vault.
A decentralized network means there is no main destination. Bitcoin has no central office building, support, staff, etc.
It’s completely peer-to-peer i.e even if a small country basically disappears off the blockchain, it would continue as long as it has 1 other peer to communicate with.
The blockchain is self-healing; it doesn’t need anyone to manage it.
It runs constantly regardless of if you are using it or not.
There is also a massive amount of redundancy, so everyone becomes a backup for the system according to the protocol of Bitcoin.
Don’t stop reading now. We are nearing the interesting part.
LESSON 5: What is Bitcoin Built On?
Bitcoin is built on the internet itself and everything that makes up the internet… All servers, cables, computers, etc.
So it is built on a pretty solid and stable foundation.
The internet can never stop. The internet operates the entire world.
Many confuse the internet with the worldwide web (www).
The internet operates on the TCP protocol which is the rule for the internet that can never be changed by anyone or groups of persons.
Just like the internet, Bitcoin has a protocol that cannot be changed by anyone or many people.
This allows bitcoin to become global.
Lesson 5 done, moving onward to Lesson 6.
LESSON 6: Public Data Base for Bitcoin
All of the information i.e transaction taking place are public, meaning everyone can see everything.
Not public as in your identity or what you bought, but as wallet transfer, amounts, etc.
No worries!! No one can do anything with this information. This is part of the open trusted transaction in Bitcoin.
Some of the several important features that set it apart from government-backed currencies are:
1. It is Decentralized
No central authority controls the Bitcoin network. The bitcoin network is made up of all the machines that mines and processes transaction on the bitcoin network.
That means that, in theory, one central authority can’t tinker with monetary policy and cause a meltdown.
Or, simply decide to take people’s bitcoins away from them; like the central European bank decided to do in Cyprus in early 2013.
And if some part of the network goes offline for some reasons, the money keeps on flowing
2. It’s Easy to Set Up
Conventional banks make you jump through hoops simply to open a bank account.
Setting up a merchant account for payment is another tedious task, beset by bureaucracy.
On the other hand, you can set up a bitcoin wallet in few seconds.
All you require is your email address, no questions asked, and with no fees to pay.
It’s completely free with no restrictions.
3. It’s Anonymous
Well, kind of.
Users can hold multiple bitcoin addresses, and they aren’t linked to names, addresses, or other personally identifying information.
4. It’s Completely Transparent
Every single transaction that has ever taken place on the bitcoin network is stored on a general ledger, called the blockchain.
The blockchain tells all.
If you have a publicly used bitcoin address, anyone can tell how many bitcoins are stored at the address. They just don’t know who it belongs to.
If you want to make your activities more opaque on the Bitcoin network, you can do so by not using the same bitcoin address consistently and not transfer a lot of bitcoin on a single bitcoin address.
5. Transaction Fees are Miniscule
Your bank may charge you a $20 fee for an international transfer.
Bitcoin doesn’t.
6. It’s Fast
Sending money across the world has never been this fast.
When you send money over the bitcoin network, it arrives in minutes once the bitcoin network processes the payment.
This is unlike international transactions that takes 2 to 7 days.
7. It’s Non-Repudiable
When your bitcoins are sent, there is no getting them back, unless the recipient returns them to you.
They are gone forever!
Lesson 7 loading…
LESSON 7: What is Cryptography?
In Cryptography, data is stored and transmitted in a way that only those for whom it is intended can read and process.
Cryptography techniques include microdots, merging words with images, and other ways to hide information in a storage or transit.
In today’s Cryptography, the plaintext is scrambled into ciphertext and back to plaintext (the process is known as encryption and decryption respectively).
Modern cryptography concerns itself with the following four objectives:
- Confidentiality (the information cannot be understood by anyone for whom it was unintended)
- Integrity (the information cannot be altered in storage or transit between sender and intended receiver without the alteration being detected)
- Non-repudiation (the creator/sender of the information cannot deny at a later stage his or her intentions in the creation or transmission of the information)
- Authentication (the sender and receiver can confirm each identity and origin/destination of the information).
In Lesson 8, you will learn how Bitcoin reaches a consensus.
Read on.
LESSON 8: What is Consensus?
Bitcoin (capital “B”) is an open-source software protocol that enables a blockchain to be built on a trusted peer-to-peer decentralized network on the internet.
It can be used to host a public database which tracks changes in the ownership of the assets and is secured by cryptography and consensus.
Consensus can be said to be something like “a strong majority on the basis of the strength of an argument and/or expertise”.
As an example, let’s say six (6) experts strongly agree to something and provide a strong argument for it.
Then, seven (7) laymen merely state that they oppose the proposal.
The proposal would in most be said to have consensus.
However, if five (5) experts present a strong argument for a proposal and four (4) experts present an equally strong argument against it, then it would probably not be said to have consensus.
This is commonly the way that technical decisions are made in open-source projects, including many bitcoin open-source projects.
In other words, the agreement amongst everyone on the bitcoin technology is MATH.
Math is central and non-biased and is always true.
So as long as the math agrees to the protocol, then the agreement is made across all users.
For example: 2 + 2 = 4
It’s becoming clearer, isn’t it?
I will talk about wallets next.
LESSON 9: Types of Wallet That Can Be Used
There are 2 major categories of wallets that can be used
- HOT (Hot Storage)
- COLD (Cold Storage)
The difference in these wallets is on whether they are connected to the internet or not connected to the internet.
Hot wallets would consist the following types:
- Software wallets
- Desktop Apps
- Web Wallets (Blockchain, Coinbase, Luno, Bitpay, etc…)
Cold wallets would consist of:
- Paper wallets
- Hardware wallets (USB Stick)
- Brain wallets
- Multi-Signature wallets
Find examples of these wallets in Lesson 10.
LESSON 10: Bitcoin Wallet Examples
LESSON 11: Support the Bitcoin Technology
There are several different roles someone can play with bitcoin technology
- Bitcoin user
- Node
- Miner
- Developer
- Entrepreneur
- Supporter
PS:
If you want to learn how to trade cryptocurrencies profitably, we have created a perfect course to help you do that.
Enroll in our Cryptocurrency Mastery Course by going to www.ctmastery.com.
You can also join our Telegram community at https://t.me/ctmastery for more information.
LESSON 12: Becoming a Bitcoin User
Share information you have learned about bitcoin.
You can share this course with others bringing awareness to bitcoin technology
Start replacing normal activities with Bitcoin use Bitcoin wherever accepted
Running a Full Node
A node is a computer that maintains a full copy of the blockchain and relays transactions to other nodes.
Web wallets run off a signal node or no node at all. Although web wallets may have millions of users, that doesn’t mean that there are millions of nodes.
If interested in running a full node, you need to make sure you are using a dedicated computer with the proper specifications.
You can find out more about nodes at http://bitnodes.21.co/
Becoming a Miner
Mining bitcoins is very, very important.
Considering there will be 21million bitcoin ever created, this means that the price of bitcoin will continue to rise in value substantially; a simple law of supply and demand.
Miners are rewarded with bitcoin whenever a new block is created from their mining process, but this is not easy.
In order to mine bitcoins, there is a mathematical equation that has to be solved.
The block rewards halve every 4 years and you can check the progression of halving at http://www.bitcoinblockhalf.com/
The bad side of this is that becoming a miner is very expensive and not viable any longer for many people unless MONEY is not an issue.
Mining farms are created in colder climates like Iceland, Alaska etc.
But an option you have is to invest in mining companies. Simply google “bitcoin mining”.
Be careful of scammers.
To start investing and generating bitcoin, visit the investment section of our website or click here.
The investment there are tested and trusted and we continuously update it.
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