Hello friends, in today’s article, we see the Crypto:- is bitcoin really Decentralized. so the aim of blockchain technology is to become a decentralized system of transactions, that no one can track, or hack. So let’s understand this bitcoin/blockchain technology control.
Is Bitcoin Really Decentralized?:-
Lots of People say, Bitcoin is decentralized, so after reading this article, you can decide.
so let’s start
First, understand the what is the meaning of the centralized and decentralized system.
- In a centralized System:- Have full control in one center component. if you destroy the center components, then all system is shut down.
- A Decentralized system, Doesn’t have any central system. if you destroy 2-4 components, then other components run the whole system. (Crypto:- Is bitcoin really decentralized)
In Bitcoins, components called nodes
Nodes:- Nodes have Independently validated all transactions and updated the ledger/blockchain with new valid blocks
Miners are those special nodes
Minors:- Special nodes that bundle valid transactions into blocks to solve the hash puzzle and distribute the new blocks to other nodes.
Nodes and Miners have to download software on the computer to do the mining
that software is called Bitcoin Software, when you run the software, then you work as nodes. work is like checking whether transactions are valid or not.
So some of you as this question is there a home desktop computer that can do minings and get bitcoin by solving hash puzzles?
In 2009, bitcoin come, At that time normal computers also do the mining because very few people know about this, and hash puzzles have less difficulty when competition increases. (Crypto:- Is bitcoin really decentralized)
e,g, First people do mining with a knife, then some people buy a gun, and then some people buy a rifle and do mining, after this, some people buy a machine gun and do mining, and some people buy a tank and do mining.
so just like this, minor update, their hardware now a day bitcoin Hardware are ASICs (Application-specific Integrated Circuits)
Normal computers do lots of work at one time. but ASICs do only one work. and that work does a better way.
ASICs software, after this software no new update comes into the market.
Now a day also we use ASICs software for mining the bitcoin
So nowadays, lots of minors find, so for a person to solve a hash puzzle is difficult. to solve this problem, one concept come is Mining Pools.
Mining Pools means, lots of minors come together and start mining in groups. by using their hash Power and contributing to a mining pool.
by contributing hash power, to the mining pool then these groups’ hash power increases, and the chance of solving the hash puzzle is easy. (Crypto:- Is bitcoin really decentralized)
By solving the hash puzzle, the reward in form of bitcoin is distributed in groups, that give the hash power.
so this system works like this,
so come to our main question is, Is bitcoin really decentralized?
The answer is ya, Bitcoin is Decentralized,
there are no central components that control the system like a person or company. there are only 10,000 nodes available and anyone can become a Node.
rules endorsed in bitcoin software:- by design Bitcoin is decentralized but for some points comes as centralization
so let’s see what are the points,
- Bitcoin Software:- 97.5% of nodes use the Bitcoin core software (block system company developed) of 10,000 computers (nodes) almost everyone uses this software. those who develop this situation got the fund from the Block system company. and also give employment.
By seeing this we can say the Block system controls the ” Bitcoin Core” software, bitcoin software used.
2) Mining Hardware:- 70-80% ASICs, made by Bitmain Company
so mining hardware also has centralization
3) Mining Pools:- Top 4 pools control = 50% Hash power
if the top 5 pools got together then they can attack the blockchain system called a 51% attack
In these 4 pools, 2 pools are owned by one company i.e. Bitmain
if their company decides to change, then bitcoin’s longest chain also changed. Mining pools also have centralization.
4) Chinese Control:- 70-80% of ASICs are made by a Chinese company.
80% of hashing power is controlled by Chinese pools.
You know the Chinese government, this government controls all companies. so this one side says, the Chinese government has centralization. (Crypto:- Is bitcoin really decentralized)
5) Few Nodes:- Blockchain size is 250 GB and growing at 50 GB per year.
In 2018, nodes do not increase in number, with only 10,000 nodes available. In the future may be nodes also go centralized.
Blockchain size is 250 GB and growing at 50GB per year, for blockchain storage facility required.
so when the blockchain, size increases, then small minors live the work of mining, and then only big companies do the mining over time.
Because, any person, in his computer space not give to that thing that gives any reward.
Lastly, in theory, Bitcoin is decentralized but in the real world, it’s centralized.
means not that much is decentralized and some points they go to centralized.
so, friends, this is all about the is that bitcoin is decentralized. (Crypto:- Is bitcoin really decentralized)
so now you can decide if is bitcoin decentralized or not.
Start your blogging Career in Bitcoin:- Link for cheap Hosting:- Click here
Read more Investing articles,
[…] Bitcoin is really decentralized […]