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What is the Blockchain?
Ever since Satoshi Nakamoto released the white paper for Bitcoin in 2008, the idea of a decentralized network was made available to the public through the blockchain.
The blockchain is a peer-to-peer, public (yet anonymous) database of transactions that can be downloaded by anyone in the world and maintained by anyone.
Blockchain technology eliminates the need for trusting a third-party, like a bank or centralized company that can manipulate and influence their respective market and ecosystem to meet their own desires.
With this new technology, online payments can be made from one user to another directly, without the need for a central authority, and can be done almost instantly.
How is Bitcoin’s Blockchain Network Maintained?
Despite the blockchain being trustless, users must be incentivized to maintain and protect the network from attackers and parties that may not want to play by the rules.
This is completed by an algorithm called “Proof-of-Work.” This enables a digital signature and timestamp on transactions to avoid double-spending, and also acts as a way to authorize activity on the blockchain network.
These actions are completed by people from all over the world that are running the software. There is no central company, server, or person controlling Bitcoin’s blockchain.
It is controlled by anyone who runs the software. These people are called “miners,” and they use the processing power from their CPU, GPU, or specialized devices to contribute to the network by solving mathematical calculations to authorize transactions.
The processing power is called “hash rate,” or “hashing power,” and it is the term used to measure a user’s power on the network.
As each miner solves complex mathematical calculations and authorizes blocks that store the transactional data, a reward in Bitcoin is given to those who contributed. This incentivizes the miners to work on the blockchain network and continue maintaining it.
What is the Hash Rate?
“Hash rate” is a term used frequently in the Bitcoin community to measure the speed of the machines working on solving complex algorithms that generate bitcoins.
This uses considerable amounts of electricity, and as it gets more difficult to generate bitcoins, more power and speed/hashes are needed.
Higher hash rates mean a better chance of the computer finding the next block of transactions and receiving the reward.
It’s why when our top cryptocurrency stock suggestion, HIVE Blockchain Technologies (TSXV: HIVE & US: PRELF) announced that they were going to increase their hash rate by 70%, the stock nearly doubled!
HIVE is a computer mining company that powers the blockchain. The blockchain is what has every Fortune 500 company’s attention, as well as a few others, like the Department of Defense and Homeland Security.
Why is it Called a Blockchain?
As stated earlier, the blockchain is a peer-to-peer database. In Bitcoin’s case, it is a database of transactions that are stored in blocks. Each block is linked and can be traced back to the first one, which is called the “Genesis Block.”
This helps ensure each block is valid and the network is not compromised, enabling a trustless network for payments.
The blockchain can be designed to be much more than a payment network. It can be programmed to fulfill numerous tasks, such as data storage, application development, and you can even create a new Internet-based economy with more security than the one we have now.
Many are calling the blockchain the ultimate disrupter, or Internet 3.0.
In our own analysis, this is like investing into the Internet in the late 1980s.
Our Recommendation: Consider shares of HIVE Blockchain Technologies (TSXV: HIVE & US: PRELF).
This is, without a doubt, the easiest and best way to participate in the blockchain revolution, in our opinion.
The company both produces new cryptocurrency and hoards it, including coins like Ethereum, whose platform is used by companies like Intel and Microsoft!
This work is based on public filings, current events, interviews, corporate press releases and what we’ve learned as financial journalists. It may contain errors and you shouldn’t make any investment decision based solely on what you read here. It’s your money and your responsibility. The information herein is not intended to be personal legal or investment advice and may not be appropriate or applicable for all readers. If personal advice is needed, the services of a qualified legal, investment or tax professional should be sought. We own shares of HIVE Blockchain Technologies, and are long the company, Future Money Trends staff is prohibited from selling shares after initiating any coverage of a company for the first ninety days and within thirty days of any email marketing. We have also received stock options from the company, and plan to accumulate additional shares in the future and without notice being given to our readers. Never base any decision off of our emails.