Bitcoin and Cryptocurrencies

Authored by: Mostafa Hashem Sherif

Protocols for Secure Electronic Commerce

Print publication date:  May  2016
Online publication date:  May  2016

Print ISBN: 9781482203745
eBook ISBN: 9781482203776
Adobe ISBN:

10.1201/b20160-15

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Abstract

Bitcoin is the lightning rod for a new species of digital money. In this system, the operations of money creation and system supervision are distributed; that is, there is no functional equivalent to a central bank. The total number of bitcoins is fixed and the rate of issuance is programmed to decrease over time, so there is no possibility to intervene in the bitcoin economy. All value transfers are recorded in a distributed public ledger with cryptographic protection. This means that the size of this ledger increases continuously as new transactions are added. Ledger verification is distributed among the nodes of the Bitcoin network. Nodes that participate in the verification gain a reward in bitcoins if they also resolve a cryptographic puzzle.

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