Page 11 - Crypto Beginners Guide

Bitcoin In Action: Remember, we previously explained how blockchain transactions work.
How It Works Allowing transparent, secure and anonymous peer-to-peer exchange of value, free
from the control of external parties. Well, Bitcoin – or BTC – works the same.
Go back to the previous article to review the steps.

Mastering Bitcoin requires an understanding of two specific notions:
mining and proof of work. They are directly related to the process used by the Bitcoin
network to verify and validate a transaction. Knowing that this protocol can differ
from one cryptocurrency to another, according to its blockchain rules (remember
the Carbonara Pasta analogy?).

Bitcoin makes use of a consensus protocol known as Proof of Work (PoW).
In which, there are miners that compete to solve complex puzzles – like a giant
Sudoku – to verify blocks before adding them to the blockchain. This process is called
mining. There’s no easy algorithm to solve a sudoku, but once completed, you can
quickly check the correctness of the answer. The miner who succeeds is awarded
with a small amount of BTC. In return, all miners combined give their computing
power to the Bitcoin network which provides it with stability, security and of course
decentralization. Indeed, if one miner is acting maliciously or is compromised,
all other participants in the network will still verify the correctness
of the transactions.

Here we are: mastering Bitcoin! Sure, we did not cover everything, but it is enough to
get you on track. The rest will follow. And now you should be ready to
pursue your crypto journey with… the other cryptocurrencies a.k.a altcoins!
Click here if you want to discover the rest of crypto-land!

Ledger Crypto Beginner’s Guide 11