Bitcoin Forum

Hi,
 
   I am very new to Bitcoin. Read some articles and trying to understand how Bitcoin works.

  Could someone spend some time to explain about below questions.

   1. What are the systems the BitCoin Network contains and who are managing those systems.

   2. I think any body can work as a Minor if he/she uses a PC/Laptop to add a transacation in a Block.
     If  no minor is doing this mining work, will the receives still receives his Bitcoin ( if a sender sends ).
     Can you explain how the receiver can receive the BitCoins.

    3. How the sender and receiver knows the transactions are Confirmed. Will they get any information.


Thanks in Advance.

The preferred spelling is bitcoin, with Bitcoin being used to refer to the protocol or network (but not the actual value). BitCoin is not used.

The Bitcoin network is a decentralized, fully peer-to-peer network. That means anyone can run a Bitcoin server and function as a node in the network. Nodes relay transactions.


Yes, anyone can mine. In the early days, any computer was sufficient to mine a block. These days, However, powerful, specialized equipment is recommended.

The total mining power is insane, so the issue of "no one mining" is not relevant. Since the function of mining is to process transactions, Bitcoin wouldn't work if no one was mining. So, no, the receiver would never get his bitcoins.

I would recommend reading up on the "blockchain". That concept is fundamental to understanding how Bitcoin works.

Very roughly, a person doesn't actually "receive" bitcoins. Everything is recorded in the blockchain. When someone says they have some bitcoins, what they actually have is the cryptographic (private) key that allows them to transfer bitcoins associated with a specific public key (address).


The wallet software handles this, although anyone with knowledge of the transaction could look it up on the blockchain (e.g. using blockchain.info).

Hi,

   Thanks a lot for your explanation.

   I have further questions regarding  Block Chain.

   As per explanation about Block Chain,

A block chain is a transaction database shared by all nodes participating in a system based on the Bitcoin protocol. A full copy of a currency's block chain contains every transaction ever executed in the currency. With this information, one can find out how much value belonged to each address at any point in history.



  1) Since block Chain is a transaction database, will it be stored in all the nodes of the network i.e. all the computors of the Minors ?
 
  2) Is there any limit on transactions duration i.e since which date the transcations will be stored in a computor. If it is going to store  all the transaction for a longer period, what about the disk space of that transaction.

  3) If anybody's ( Minor's ) PC is switched off for some time, how the transactions will be synched once it is on?

  Another basic question is, since the bitcoin Network is functioning by only Minors and since the existence of all Minors in the network is optional, how the Bitcoin Network was started initially?

 Could someone can spare some time to explain this.


Thanks & Regards

All full nodes will have a complete copy of the blockchain.  This means the operators of mining pools, anyone that is solo-mining, anyone running any version of the reference client (Bitcoin-Qt, bitcoind, Bitcoin Core), and anyone running a bitcoin peer that implements the entire protocol.


Bitcoin is designed to be trustless.  This means that every full peer can validate every transaction without needing to trust any other peer.  As such, every confirmed transaction is permanently stored in the blockchain.

The protocol currently has a maximum size of 1 megabyte per block, and a new block is added to the blockchain on average every 10 minutes.  This means that the blockchain can currently grow at a maximum rate of 52.5 gigbytes per year.

At the moment you can buy a 4 terrabyte hard drive for less than $200. This is large enough to store the next 76 years of blockchain growth.  I highly expect that the maximum permanent storage space available to computers will grow even larger in the next 76 years.  Even if it doesn't, it should be possible to split the blockchain across multiple storage devices.  As such, I don't expect there to be any storage problems for at least the next 500 years.  Honestly, I'm not conceited enough to try and predict what the world will be like 500 years from now, so I'm not going to worry about how the future technology is going to handle currency concerns.


It will connect to peers and obtain all the blocks that it missed from those peers.  It will validate every block and every transaction before adding it to its own blockchain.


The person (or people) who created the bitcoin protocol ran their own miners initially.  Because there is a financial incentive to mining, others quickly joined in and participated in mining as well.

If you haven't read the Bitcoin Whitepaper published by Satoshi Nakamoto yet, you really should.  It will give you a much better understanding of the basics.

1. http://en.wikipedia.org/wiki/Bitcoin
https://www.youtube.com/watch?v=Lx9zgZCMqXE
2. http://en.wikipedia.org/wiki/Bitcoin
https://www.youtube.com/watch?v=Lx9zgZCMqXE
3. Depend on a wallet app.

When I were the very new to Bitcoin I had the same questions haha

those questions are indeed very important and answers are around very easy to find.

Regards!

everyone of us has had the same questions so good question.  I'm thinking by now you have the right idea of where to find your answers.  Keep asking the good questions frien that is why we are all here.

Hi all,

               Thanks a lot for your answers. I got good idea now.

               I have few more questions regarding Network. Could somebody spend sometime to explain these.

               1. When a Client wants to send a Transaction ( Make payment ), how it knows the IP Address of the Network to which it has to send.
                    Is there any DNS Server  managed?

               2. Where the transacation are stored before they are included in a Block.

              3. How and where the nodes can check the Transactions which have to be included in the Block

              4. If a new Miner wants to add a node, How the Miner can get the IP address of the Network to which his/her Node can be added.


Thanks & Regards

               

I wondering where should we define bitcoin under cryptography standards perspective ...

http://en.wikipedia.org/wiki/Cryptography_standards

 ???

The Bitcoin Network is a peer-to-peer (P2P) network. Any client or node in the network can be connected to any number of other nodes. They (in principle) all relay transactions, so just being connected to 1 is enough.

That said, if you are just starting your client for the very first time after downloading it, how do you find that first contact in the network? This "bootstrap problem" is common to all decentralized networks. The solution chosen for the main Bitcoin client is simply to hardcode the address of a server (technically an IRC server where other nodes join, backed up by a hardcoded list of "known good" nodes).


The transactions are stored in the memory pools of the miners who are trying to complete the next block of the block chain. Most bitcoin clients will also resend the transaction if it isn't included for some reason.


No transaction HAS to be included in a block. The miners are free to chose which transactions they want to include and which they don't.

As for validating a transaction, that is simply a matter of verifying the cryptographic signatures. The information required to do that is contained in the block chain.


Any node can mine. Any node can submit a block solution to the network and it will become the next block in the block chain if valid (simplified a bit).

This question seems to overlap with question 1 and appears rooted in some misconceptions. For the detailed process about getting something to mine, you could look up getwork ( https://en.bitcoin.it/wiki/Getwork ), but that's probably more than you're asking for.

Thanks a lot for this thread as I am also new to Bitcoin and was going to read in different threads and now whne it is in one place it more convenient !
Thanks guys

I would recommend reading up on the "blockchain". That concept is fundamental to understanding how Bitcoin works.

Very roughly, a person doesn't actually "receive" bitcoins. Everything is recorded in the blockchain. When someone says they have some bitcoins, what they actually have is the cryptographic (private) key that allows them to transfer bitcoins associated with a specific public key (address).

Thank you for your answer, I learned.