What is The Bitcoin Network?
A free video tutorial from Marcus Gustafsson
Computer Technology Fanatic & Cryptocurrency Investor
4.4 instructor rating • 1 course • 6,490 students
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02:01:29 of on-demand video • Updated December 2017
- How to Buy, Sell, Send, Receive, Exchange & Store cryptocurrencies
- What Blockchain is & how it works on the inside
- What Bitcoin & Ethereum is and what they are used for
- What cryptocurrency & cryptography is
- Protecting your cryptocurrency investment
- The history of bitcoin & cryptocurrencies
English [Auto] In this video we're going to take a look at what the bitcoin network is so that we in the next video can take a look at how it works. Let's first see what kind of players the network consists of. We have regular users like me and we have the miners. The miners are the ones who keep track of all the transactions. They are the ones who secure that network. You might have heard the word block chain and know that it's something Bitcoin uses the block chain. It's the way that the miners keep track of all the transactions. It's a chronological list of all the transactions that has ever been made with Bitcoin and each block contains a number of transactions. It can contain a maximum of 1 megabytes worth of transactions which would be around 2500 transactions. This list is kept on every miner's computer and it updates as minders put in new transactions. This way they know how much money everyone has. You might also have heard that Bitcoin is decentralized and what that means is that there is not just one group of people that has control and keeps track of the money like a bank. Instead many people around the world helps to keep track of everything so that there is not a single point of failure to understand how the network uses shot 256. We must first take a look at what is called tese. You have to kiss your public key and your private key. You can look at it like this your public key is like your account number and your private key is the password to access that account just like with a bank you can have several accounts if you want to. These keys are generated together and are mathematically related to each other so that the private key can only access that specific public key or account. So if you want to have several accounts you need a new pair of keys for each one. This rings of character as you see here. Its actually a real pair of keys to an empty Bitcoin account. Something thats very different from a bank account is that if someone got a hold of your password but they didn't know what account it led to they would not be able to access your account. But with Bitcoin they can all they need to take your money. Is this private key. This key is very important and it should never show it to anyone. The reason they are able to access your account without having the account number is because of the way these keys are mathematically related. If you only have the public key or the account number you can figure out what the password is. But if you only have the password the private key you are able to regenerate the public key. Now that you know what the keys are and that the miners job is to put your transaction in the block list. We can move on to the technical parts and see how they use SHARC 256 to make sure no miner tries to cheat the network by changing some transaction in the list and how they make sure that the transaction was in fact sent by you.