Where do the majority of Bitcoin transactions take place?


Because bitcoin is a pseudonymous digital currency, there are no hard statistics available.

Because one popular service, SatoshiDICE, uses static Bitcoin addresses as the wagering mechanism for the players of its online "Dice" game, the amount of activity related to them can be measured. It currently represents the majority of bitcoin transactions (but not value) that crosses the network.

Currently the Bitcoin network is hitting about 50,000 transactions per-day. Some of these transactions will be performed for the purpose of mixing coins to protect the privacy of the sender.

By far the biggest interest in Bitcoin to-date (going from an educated guess) has been for speculative and investment purposes. As such a large amount of the activity is transfer of funds to and from (and between) exchanges.

The ratio of this type of activity versus commerce involving digital and physical goods will heavily favor the speculative/investment but by to what degree is...

0 0
0 0

Find answers to recurring questions and myths about Bitcoin.

Table of contents


What is Bitcoin?

Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.

Bitcoin is the first implementation of a concept called "cryptocurrency", which was first described in 1998 by Wei Dai on the cypherpunks mailing list, suggesting the idea of a new form of money that uses cryptography to control its creation and transactions, rather than a central authority. The first Bitcoin specification and proof of concept was published in 2009 in a cryptography mailing list by Satoshi Nakamoto. Satoshi left the project in late 2010...

0 0

Many cryptocurrencies have been born on the Internet in recent years, and Bitcoin is definitely the most prominent among them all. Bitcoin is the leader of the digital currency movement and is gathering mainstream media attention around it. However, a lot of Internet users still don’t understand what Bitcoin really is and why they should be using it. You have a credit card and Skrill/Neteller already, so why would you even bother switching to Bitcoin? Read this to see why.

Transactions Are Quick

Bitcoin is slowly starting to replace traditional means of transferring value from one place to another. Cheques, wire transfers, and bank transfers frequently suffer from delays and human error, as different people get involved in the process from both ends of the transaction.

Bitcoin transactions are much faster and, if a user opts to select “zero confirmations,” the payment can be processed instantly. “Zero confirmations” can be dicey, as users are able to reverse...

0 0

A small group of bitcoin industry leaders, developers and miners are planning to discuss the digital currency's development roadmap at an invite-only meeting in May.

A notice of the gathering, as well as a list of potential guests, was posted to a private mailing list today, with participants reportedly including major players from the ongoing, and recently active, scaling debate.

Bitcoin.com owner Roger Ver, Bitfury CEO Valery Vavilov, Coinbase CEO Brian Armstrong, Blockchain CEO Peter Smith are among those listed as possible attendees.

Other participants suggested to be attending include Bloq CEO Jeff Garzik, an undecided representative from BitGo and Digital Currency Group CEO Barry Silbert.

"It is certainly my hope that each of you see somebody below that you know and trust to advocate for – and hopefully agree on – a path forward that is best for our industry," Silbert wrote in the mailing list message.

DCG confirmed it is helping to organize...

0 0

It is true that a small percentage of Bitcoin transactions are illegal, but the majority of illegal goods are bought with US dollars, the primary currency used in the international trade in illicit goods, economist Mark Thornton told RT.

On January 27 US federal charges were made public against two men accused of operating a bitcoin exchange business in connection with the ongoing investigation involving the Silk Road online marketplace. Robert Faiella and Charlie Shrem were arrested within hours of each other and charged with conspiracy to commit money laundering, and operating an unlicensed money transmitting business. Some experts believe the arrest of Shrem the CEO of the bitcoin exchange service BitInstant, and that bitcoin was used in illicit trade, could weaken its position.

“This is terrible for the bitcoin market at least temporarily. But this was a political event, not a legal or judicial event, this arrest. It was a political event meant...

0 0

The great scaling debate

The Bitcoin scaling debate that has been ongoing for almost 4 years may be approaching an uncertain decision this Summer. Some groups including the Bitcoin Core development team wish to improve Bitcoin’s scalability via a soft fork upgrade call Segregated Witness or ‘SegWit’. Segwit doesn’t increase the blocksize but it does allow more transactions to fit inside 1MB blocks by counting withness data in a different way. It also solves the issue of transaction malleability which allows for the implementation of second layer payment channels like the Lightning network which comes as an off chain scaling solution.

Litecoin soft forked and upgraded to SegWit earlier this year which led to a significant price rally. However, other groups in the Bitcoin ecosystem want to see increased block sizes via a hard fork. Bitcoin Unlimited and BTC1 development groups have written code that will support larger blocks. This is primarily favoured by the...

0 0

Frequently in popular descriptions of Bitcoin and in the user interfaces of wallet software, a distinction is made between “confirmed” and “unconfirmed” transactions. What is the difference?

At a high level, a transaction is only confirmed when it is permanently included in the Bitcoin blockchain. The blockchain is a ledger of all transactions in the history of Bitcoin. It is append-only, meaning new data can be added to the end of the ledger, but data can never be removed once included. This ledger is necessary to prevent double-spending, which is a key technical challenge in designing any cryptocurrency.

How Bitcoins are Transferred

Recall that if Alice “owns” some quantity of bitcoins, this really means she knows one or more cryptographic keys which have been designated as the controller of those coins in a transaction on the ledger which transferred the coins to Alice. In order to transfer the coins to another entity, Alice will use these keys to produce a...

0 0
0 0
0 0

Video transcript

But what I wanted to do in this video is talk about what a bitcoin is in more general terms and what differentiating characteristics they have compared to other approaches. So for starters, bitcoin is just an electronic payment system. By electronic payment system, I mean it's just a vehicle, a conduit, by which two parties can transact over the internet. I call these parties Alice and Bob. And let's say Alice for whatever reason wants to give money to Bob over the internet. And this may be because she owes Bob money, or maybe Bob is a merchant and Alice is buying something from Bob. Or maybe Bob is a not-for-profit, and Alice is making a donation to Bob. So there could be many reasons why Alice is trying to pay Bob over the internet in some capacity. Now, if Bob is willing to accept bitcoins, which are a form of electronic payments, then Alice can go ahead and send Bob some value in bitcoins. And really, a bitcoin transaction between Alice and Bob amounts...

0 0

Bitcoin is back in the spotlight these days thanks to some wild price movements and central bank meetings. The decentralized currency has recently been trading over its all-time high of $1200 on some exchanges. But the higher the price goes, the more it exacerbates bitcoin's dark side: shocking levels of electricity consumption.

In 2015, I wrote that bitcoin had a big sustainability problem. Back then, each bitcoin transaction represented roughly enough electricity to power 1.57 American households for a day— approximately 5,000 times more energy-intensive than a credit card transaction. Since it's been two years, it's time for an update.

First, a caveat: it's impossible to know precisely how much electricity any given bitcoin transaction "consumes," but it's simple enough to estimate a plausible range of energy consumption for overall bitcoin mining. Mining secures transactions on the blockchain, a giant ledger of all completed transactions.

It's worth...

0 0


BitCoin, the web’s virtual currency, isn’t without its controversy. But two things are known for sure – it’s an interesting economic experiment, and people are using it to buy real things right now. Whether you just want to find out more about BitCoin or to actually use the currency, you’ll want to check out “Virtual Currency: The BitCoin Guide”, the latest manual from author Lachlan Roy.

Cash is great. There are no banks to worry about. No fees, no credit cards, no chance of having your identity stolen or your account frozen. You may not earn any interest, but you will always have instant access to your money and you will know exactly how much you have.

Wouldn’t it be great to be able to use cash on the Internet, too? To have the ability to store your own money on your own computer? To buy what you need online without dealing with banks and middlemen? That’s where BitCoin comes in. Cash for the Internet is here.

Table of...

0 0

The bitcoin community is locked in a harsh debate over a "hard fork." REUTERS/Luke MacGregor

There's a civil war in the bitcoin community over the digital currency's future.

Developers, miners, and other stakeholders are locked in a heated debate over how best to scale the network, with chances steadily rising of irreconcilable differences causing a so-called "hard fork" that would split Bitcoin in two.

Bitcoin is in crisis, and while there's broad consensus that something needs to be done, there's little agreement on what.

What's the problem?

To put it simply: Bitcoin is too popular, and can't handle the weight of transactions going through the network.

To put it less simply: Bitcoin transactions are processed in so-called "blocks" that involve complex cryptography to verify and set the transactions. But as the currency grows and more and more transactions take place, the one...

0 0

The challenge with any new technology is finding a sweet spot. 2015 was the year that bitcoin payments began to find their own.

Bitcoin payments are highly efficient in the areas where traditional payments are not - cross-border payments, micropayments, multi-user payments, and automated payments. The transaction numbers in these areas are starting to match up with the consistent growth in bitcoin adoption and development effort across the ecosystem.

Bitcoin Spending Increases

Many outside observers have noted the Bitcoin network's tremendous transaction growth in since its creation in 2009. That growth reached new highs in 2015, as the chart below shows.

With a majority of merchant processing volume flowing through BitPay, we wanted to share some insights on the transactions that involved consumer purchases.

BitPay has seen transaction volume increase by 50% just in the last two months and by 110% in 12 months. We saw record months for...

0 0


The problem lies in a specific parameter called the “block size limit.” The current limit is insufficient for the ever-growing transaction intensity.

First, a very quick and basic introduction to how Bitcoin works for those who don’t know. All the transactions that have ever taken place in the Bitcoin network or will ever take place, are recorded on a public and immutable ledger called “The Blockchain.”

As follows from its name, the Blockchain is a sequence of blocks. Each block, in turn, is a cryptographically sealed collection of all transactions which have happened in the network over the past ten minutes. Every new block is permanently added to the end of the Blockchain so that every user can always check that each specific transaction has indeed taken place.

Back in 2010, Nakamoto introduced a block size limit of 1mb, meaning that blocks over the size of 1 megabyte would be automatically rejected by the network as invalid. This was a security...

0 0

A Next-Generation Smart Contract and Decentralized Application Platform

Satoshi Nakamoto's development of Bitcoin in 2008[1a][1b]–2009[1c][1d] has often been hailed as a radical development in money and currency, being the first example of a digital asset which simultaneously has no backing or intrinsic value[2] and no centralized issuer or controller. However, another, arguably more important, part of the Bitcoin experiment is the underlying blockchain technology as a tool of distributed consensus, and attention is rapidly starting to shift to this other aspect of Bitcoin. Commonly cited alternative applications of blockchain technology include using on-blockchain digital assets to represent custom currencies and financial instruments (colored coins),[3] the ownership of an underlying physical device smart property,[4] non-fungible assets such as domain names (Namecoin),[5] as well as more complex applications involving having digital assets being directly controlled by a...

0 0

After the feds seized and shuttered Silk Road, an online marketplace for illegal drugs, earlier this month, some technology experts started sounding the death knell for Bitcoin, Silk Road's international currency of choice. Instead, we may soon see Bitcoin's real value.

Invented in 2008, Bitcoin is not the first attempt at an all-digital, cryptographically based currency. Others have existed in one form or another for nearly fifty years, but have either failed to take off or dramatically crashed and burned. Bitcoin is the first cryptocurrency with the deep structure, wide adoption, and trading momentum to achieve escape velocity.

In practice, Bitcoin blends credit cards' ease of digital transfer with the relative anonymity of a cash handoff. Like all currencies, the problems it poses are both practical and metaphysical; like cash or credit, Bitcoin is somehow both more and less real than the goods it is traded for.

Until now, the most well-known of these goods...

0 0

Ask YOUR question!

Check out Bitcoin StackExchange!

See if your questions are among the 8,000+ queries already answered.

If not, don't be afraid to ask!

Find answers to recurring questions and myths about Bitcoin.

Table of contents


What is Bitcoin?

Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. From a user perspective, Bitcoin is pretty much like cash for the Internet. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.

Bitcoin is the first implementation of a concept called crypto-currency", which was first described in 1998 by Wei Dai on the cypherpunks mailing list, suggesting the idea of a new form of money that uses cryptography to control its creation and transactions, rather than a...

0 0
0 0

What is 'Bitcoin'

Bitcoin is a digital currency created in 2009. It follows the ideas set out in a white paper by the mysterious Satoshi Nakamoto, whose true identity has yet to be verified. Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized authority, unlike government-issued currencies. Today's market cap for all bitcoin (abbreviated BTC or, less frequently, XBT) in circulation exceeds $7 billion.

There are no physical bitcoins, only balances kept on a public ledger in the cloud, that – along with all Bitcoin transactions – is verified by a massive amount of computing power. Bitcoins are not issued or backed by any banks or governments, nor are individual bitcoins valuable as a commodity. Despite its not being legal tender, Bitcoin charts high on popularity, and has triggered the launch of other virtual currencies collectively referred to as Altcoins.


0 0
0 0

It might not be official yet but for all intents and purposes, Bitcoin is effectively a third currency, sitting alongside debit cards and traditional money.

It might be totally digital but Bitcoin is becoming more and more popular all the time, with steep rises every year in its usage.

With more and more people using Bitcoin every year the benefits and risks grow alongside it. Bitcoin isn’t quite as simple as going into a shop and handing over some money or scanning your card but it’s not as complex as it might appear either.

But before you go about buying and trading Bitcoins it’s always a good idea to read up on the benefits and risks involved. Even if you’re well-versed in how Bitcoin works a refresher on the main benefits and risks is always a good idea.

So, let’s take a closer look at the benefits and risks of using Bitcoin.

Untraceable – A Benefit and a Risk

The anonymity and un-traceability of Bitcoin as the unusual distinction of...

0 0