CMSC 150 - Fall 2017 - {Cryptocurrencies and the Blockchain}

Mining Cryptocurrencies      Unlike regular, institutional fiat currencies that will physically print out more money when necessary, Bitcoin and other cryptocurrencies are essentially created through a system called "mining," which is defined as, "...the process by which transactions are verified and added to the public ledger, known as the blockchain, and also the means through which new [cryptocurrencies] are released," (1). The mining process exists for two main reasons: to validate transactions using a specific currency and then to reward the miner who confirmed the activity by generating and delivering to him or her a set number of new coins.            If the blockchain was inconsistent, or if it faltered in its reported data about any transaction at any given point in its lifetime, then the blockchain would be unreliable and completely untrustworthy. One of the main attractions to the blockchain is that it builds upon itself from block to block of veri

Cryptocurrencies and the Blockchain Preface      For the first blog post, I generally explore my topic and its main components.  Introduction       In 2009, an unknown figure who goes by Satoshi Nakamoto invented a decentralized digital asset called Bitcoin. Designed to be used as a globally available, peer-to-peer electronic currency, Bitcoin is independent of any central authority or government (decentralized). Originally worth $0.0008 U.S. dollars per unit on its debut date of October 5, 2009, Bitcoin just recently surpassed a colossal $6,000.00 per unit. In the years after the creation of Bitcoin, many other currencies modeled after Bitcoin's design were constructed. Bitcoin and these other "alt-coins" (digital assets that are not Bitcoin) are classified as cryptocurrencies, which are defined as "digital or virtual [currencies] that use cryptography for security," (1).      Hundreds of cryptocurrencies exist today, and each of these coins has a val