Daffodil International University

Faculty of Science and Information Technology => Software Engineering => Topic started by: Tapushe Rabaya Toma on April 30, 2018, 02:24:25 PM

Title: How does cryptocurrencies work?
Post by: Tapushe Rabaya Toma on April 30, 2018, 02:24:25 PM

Let‘s have a look at the mechanism ruling the databases of cryptocurrencies. A cryptocurrency like Bitcoin consists of a network of peers. Every peer has a record of the complete history of all transactions and thus of the balance of every account.

A transaction is a file that says, “Bob gives X Bitcoin to Alice“ and is signed by Bob‘s private key. It‘s basic public key cryptography, nothing special at all. After signed, a transaction is broadcasted in the network, sent from one peer to every other peer. This is basic p2p-technology. Nothing special at all, again.