Cryptocurrency All-in-One For Dummies. Peter Kent
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Название: Cryptocurrency All-in-One For Dummies
Автор: Peter Kent
Издательство: John Wiley & Sons Limited
Жанр: Личные финансы
isbn: 9781119855828
isbn:
Say the soft fork is set to happen at block 700. The majority of the community may support the stronger chain of blocks following both the new and old rules. If the two sides reach a consensus after a while, the new rules are upgraded across the network. Any non-upgraded nodes (that is, stubborn geeks) who are still mining are essentially wasting their time. The community comes back together softly, and everyone lives happily ever after — until the next major argument, of course.
Free money on forks
Because a new fork is based on the original blockchain, all transactions that previously happened on the blockchain also happen on the fork. The developers of the new chain take a “snapshot” of the ledger at a specific block number where the fork happened (like 999 in Figure 2-1) and therefore create a duplicate copy of the chain. That means if you had a certain amount of cryptocurrencies before the fork, you also get the same amount of the new coin.
A FORKING EXAMPLE: BITCOIN VERSUS BITCOIN CASH
Even the celebrity of cryptocurrencies, Bitcoin (BTC), has seen forks. One of the well-known Bitcoin forks happened on August 1, 2017. That’s the birthday of Bitcoin Cash. In this case, the developers couldn’t agree on what the size for a block should be. Some wanted the block size to go from 1MB to 2MB, but others wanted to increase it even more, to 32MB. Some people in the community loved the new big idea, while others thought the other group was crazy. So both groups decided to go their own ways. Bitcoin Cash adapted a brand-new symbol (BCH), too. People who already had BTC got the same amount of BCH added to their crypto wallets.
As of August 2018, BCH is valued at around $750, while BTC is worth ten times more, around $7,500. Only time will tell whether BCH ever surpasses the original protocol’s value. But hey, at least the forkers got some value out of it!
Chapter 3
Introducing Cryptocurrency Wallets
IN THIS CHAPTER
A traditional wallet is where you keep your valuable personal items such as cash, credit cards, and identification cards. But now that you’re using the most advanced, futuristic form of money (cryptos, baby!), you’re gonna need a brand-new type of wallet to go with it: a cryptocurrency wallet.
With a cryptocurrency wallet, you not only can store the value of your digital money but also send and receive currencies. Additionally, you can monitor your balance the way you’d do with your bank account. This chapter walks you step by step through understanding types of cryptocurrency wallets and choosing which is best for you.
Defining Cryptocurrency Wallets
A cryptocurrency wallet is a software program that helps you manage your digital money. Although you may be the type of person who doesn’t like to carry around traditional wallets and would rather put your cash and credit cards right in your back pocket, you must have a digital cryptocurrency wallet if you want to use any type of cryptocurrency. There’s no way around it. Cryptocurrencies aren’t stored in a bank reserve like other types of traditional assets such as gold and cash. Without crypto wallets, the whole idea of cryptocurrencies dies! Cryptocurrency wallets are the air that keeps the system alive.
A few important terms
Before you get started, here are some terms to know as you explore the world of crypto wallets:
Hot wallet: A wallet that stores your keys online. You can easily access your keys, and your cryptocurrency assets, from anywhere in the world. All you need is an Internet connection and access credentials. Although hot wallets are convenient, that convenience comes at a cost. If someone steals your access credentials, they can steal your Ethereum assets. Also, you have to trust the wallet organization that stores your keys. If your wallet organization is hacked, or goes out of business, you could lose everything. If that organization is a target of an investigation, your information could be divulged or your assets frozen.
Cold wallet: A wallet in which you store your keys offline. You need to provide your keys only when you want to access your assets. You can store keys offline in multiple ways, but this approach requires a few extra steps when you want to buy or sell crypto-assets (or interact with smart contracts, which we introduce in Book 2, Chapter 5).Although cold wallets are a little less convenient, they can be more secure. You have control over your keys with a cold wallet and can take whatever precautions you feel are necessary to protect your keys. Using a cold wallet gives you an alternative and mitigates the threat of an attacker hacking into your online wallet and harvesting lots of keys. With a cold wallet, you're responsible for protecting your keys. You have to make sure that every place you store your keys is as secure as possible.
Wallet address: A number that functions in a similar way to a traditional bank account number.
Public key: A code that allows you to receive cryptocurrencies into your account or wallet. It’s mathematically linked to your wallet address, but it isn’t identical.
Private key: A code that’s coupled with the public key to ensure your security. It’s something like your own private password that you use to enter your bank account in the real world.
The following section explains how some of these items work together so you can complete crypto transactions.
How a wallet works
Crypto wallets don’t actually store the cryptocurrency itself; СКАЧАТЬ