How Transactions Take Place in the Crypto World?
December 30, 2019
People who are interested in entering the world of cryptocurrencies might be interested to know how transactions take place in this network. Well! In simple terms, when one party sends bitcoin to another party; the transaction is immediately recorded into a block. This block is automatically attached to the previous block of the transaction, and in this way, a chain of blocks is created on the digital platforms. That is why the technology working behind this crypto world is named as blockchain. Note that, once a transaction is accomplished, one cannot reverse or temper it because to do so, the person needs to remove the block from that chain and it is not possible in this system.�
Moving into the technical concept; it is high time to understand that bitcoin wallet does not carry a bitcoin directly. It simply holds the address of the coin; this address carries all the details regarding previous transactions and current balance as well. Experts reveal that this address is made up of a combination of letters and numbers that make up 34 digits in all. This sequence of digits is also named as a public key that can be seen by the world. Further, this public key is secured by a private key that is made up of a large combination of letters and numbers; it has 64 digits. As the name indicates, this private key is secret, and it ensures complete safety of your digital currency on the network. Although both these keys are related to each other; still, it is difficult to predict the private key by just knowing public key.�
Note that, no transactions on the blockchain network can be completed without entering the private key to the software. Hence, this system is observed to have a higher level of security and users can stay tension free about their currency. This process of transactions is not restricted to bitcoins only; instead, most other coins follow the same system in the crypto world. Some of the most popular and frequently used coins are Litecoin, Ethereum and Bitcoin Cash.�
The blockchain technology has huge potential in this digital world. There is no way to temper the blocks, and hence the currencies cannot be hacked or damaged by intruders. The owners can feel safe about their money; however, it is essential to be more careful about saving your private key. It must be kept secret and safe as well.�