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Bitcoins are the ledger's native unit of account. The base unit of exchange is [[Satoshis]] and 100,000,000 satoshis is referred to as one Bitcoin. Satoshis are held in script puzzles called [[UTXO|Unspent Transaction Outputs]] or UTXOs. These are monetary outputs from [[Bitcoin Transactions]] which are held by miners in a quick access database called the UTXO set. During the spending process, UTXOs being used in a transaction are destroyed and the solution to their puzzle script is recorded. | Bitcoins are the ledger's native unit of account. The base unit of exchange is [[Satoshis]] and 100,000,000 satoshis is referred to as one Bitcoin. Satoshis are held in script puzzles called [[UTXO|Unspent Transaction Outputs]] or UTXOs. These are monetary outputs from [[Bitcoin Transactions]] which are held by miners in a quick access database called the UTXO set. During the spending process, UTXOs being used in a transaction are destroyed and the solution to their puzzle script is recorded. | ||
| − | Valid transactions that are broadcast on [[The Bitcoin Network]] are committed to the Bitcoin public ledger by [[Mining|Bitcoin miners]]. The ledger is built in [[ | + | Valid transactions that are broadcast on [[The Bitcoin Network]] are committed to the Bitcoin public ledger by [[Mining|Bitcoin miners]]. The ledger is built in [[Block|blocks]] which are discovered every 10 minutes on average and linked together forming a [[Block chain]]. The ledger is structured as a Directional Acyclic Graph (DAG) allowing the history of all Bitcoins to be traced back to the [[Coinbase]] transactions where they were discovered. Transactions can be exchanged peer to peer, allowing them to be modified in payment channels however once they have been committed to the ledger they are [[Irreversible Transactions|recorded immutably]] and cannot be un-done. |
The Bitcoin ledger is held on a distributed network of nodes who compete with each other to extend it by adding blocks. The miners who participate in building the network are incentivized to be directly connected to as many of the other block winning miners as possible to ensure blocks they discover are accepted as fast as possible. This leads to miners forming a [[Small World Network]] which trends towards a [[Nearly Complete Graph]] where all miners are connected to all other miners. Miners receive transactions from peers and from other miners on the network and propagate them to make all other known miners aware of every new transaction. This defeats the double spending problem ensuring that global consensus can be reached on the validity of a transaction within roughly 2 seconds. The miners use hash based proof of work to compete for the right to extend the ledger, and as a means to vote on the network rules. | The Bitcoin ledger is held on a distributed network of nodes who compete with each other to extend it by adding blocks. The miners who participate in building the network are incentivized to be directly connected to as many of the other block winning miners as possible to ensure blocks they discover are accepted as fast as possible. This leads to miners forming a [[Small World Network]] which trends towards a [[Nearly Complete Graph]] where all miners are connected to all other miners. Miners receive transactions from peers and from other miners on the network and propagate them to make all other known miners aware of every new transaction. This defeats the double spending problem ensuring that global consensus can be reached on the validity of a transaction within roughly 2 seconds. The miners use hash based proof of work to compete for the right to extend the ledger, and as a means to vote on the network rules. | ||
Revision as of 01:59, 31 December 2019
Welcome to the Bitcoin wiki. Here we aim to provide a correct and up-to date set of information on the Bitcoin network and its features and functionality.
Bitcoin is a peer to peer cash system created by Dr Craig Wright under the pseudonym Satoshi Nakamoto and released as open-source software in 2009. It does not rely on a central server to process transactions or store funds. The leaderless structure of the network famously solves The Byzantine Generals Problem allowing disconnected entities to follow a common direction without receiving instruction. New bitcoins are issued to miners as rewards for competing to extend the ledger. Over time the competition awards coins in decreasing amounts, using an algorithm which will see the last new coins created in around 2140.
Bitcoins are the ledger's native unit of account. The base unit of exchange is Satoshis and 100,000,000 satoshis is referred to as one Bitcoin. Satoshis are held in script puzzles called Unspent Transaction Outputs or UTXOs. These are monetary outputs from Bitcoin Transactions which are held by miners in a quick access database called the UTXO set. During the spending process, UTXOs being used in a transaction are destroyed and the solution to their puzzle script is recorded.
Valid transactions that are broadcast on The Bitcoin Network are committed to the Bitcoin public ledger by Bitcoin miners. The ledger is built in blocks which are discovered every 10 minutes on average and linked together forming a Block chain. The ledger is structured as a Directional Acyclic Graph (DAG) allowing the history of all Bitcoins to be traced back to the Coinbase transactions where they were discovered. Transactions can be exchanged peer to peer, allowing them to be modified in payment channels however once they have been committed to the ledger they are recorded immutably and cannot be un-done.
The Bitcoin ledger is held on a distributed network of nodes who compete with each other to extend it by adding blocks. The miners who participate in building the network are incentivized to be directly connected to as many of the other block winning miners as possible to ensure blocks they discover are accepted as fast as possible. This leads to miners forming a Small World Network which trends towards a Nearly Complete Graph where all miners are connected to all other miners. Miners receive transactions from peers and from other miners on the network and propagate them to make all other known miners aware of every new transaction. This defeats the double spending problem ensuring that global consensus can be reached on the validity of a transaction within roughly 2 seconds. The miners use hash based proof of work to compete for the right to extend the ledger, and as a means to vote on the network rules.
The Bitcoin protocol defines the scripting language that is used to define transactions, the formatting of transactions and blocks, the rate at which new bitcoins are issued as rewards for adding to the ledger, and the mathematical rules outlining the target for the difficulty algorithm which tries to keep the network generating new blocks at an average rate of 10 minutes each. The protocol is agreed upon by the miners who control network operation. After the Genesis upgrade, miners will remove all limit based rules from the protocol enabling them to compete to offer better service to fee paying users by scaling their own capabilities.
History of Bitcoin
More on the basics
In-depth concepts
- Transactions
- Blocks
- The Bitcoin Network
- Mining and Consensus
- Wallets and key management
- Simplified Payment Verification (SPV)
Tools and utilities
Quick Links
| Techniques | Second Layer Protocols | Products and Tools |
|---|---|---|
Advanced Bitcoin Scripting Digital Signatures (ECDSA) Payment Channels R-Puzzles SVAlias The Metanet |
GearSv Run Tokenized B://, C://, D://, BCAT etc |
ElectrumSV Handcash Moneybutton Nakasendo Planaria Relay |