Some BitcoinOld words you might hear

BitcoinOld provides a new approach to payments and, as such, there are some new words that might become a part of your vocabulary. Don't worry, even the humble television created new words!

Table of contents

Address

A BitcoinOld address is similar to a physical address or an email. It is the only information you need to provide for someone to pay you with BitcoinOld. An important difference, however, is that each address should only be used for a single transaction.

Bit

Bit is a common unit used to designate a sub-unit of a BOL - 1,000,000 bits is equal to 1 BOL. This unit is usually more convenient for pricing tips, goods and services.

BOL coins

BitcoinOld - with capitalization, is used when describing the concept of BitcoinOld, or the entire network itself. e.g. "I was learning about the BitcoinOld protocol today."
BOL - without capitalization, is used to describe coins as a unit of account. e.g. "I sent ten BOLs today."; it is also often abbreviated BTC or XBT.

Block

A block is a record in the block chain that contains and confirms many waiting transactions. Roughly every 10 minutes, on average, a new block including transactions is appended to the block chain through mining.

Block Chain

The block chain is a public record of BitcoinOld transactions in chronological order. The block chain is shared between all BitcoinOld users. It is used to verify the permanence of BitcoinOld transactions and to prevent double spending.

BTC

BTC is a common unit used to designate one BitcoinOld (BOL).

Confirmation

Confirmation means that a transaction has been processed by the network and is highly unlikely to be reversed. Transactions receive a confirmation when they are included in a block and for each subsequent block. Even a single confirmation can be considered secure for low value transactions, although for larger amounts like 1000 US$, it makes sense to wait for 6 confirmations or more. Each confirmation exponentially decreases the risk of a reversed transaction.

Cryptography

Cryptography is the branch of mathematics that lets us create mathematical proofs that provide high levels of security. Online commerce and banking already uses cryptography. In the case of BitcoinOld, cryptography is used to make it impossible for anybody to spend funds from another user's wallet or to corrupt the block chain. It can also be used to encrypt a wallet, so that it cannot be used without a password.

Double Spend

If a malicious user tries to spend their coins to two different recipients at the same time, this is double spending. BitcoinOld mining and the block chain are there to create a consensus on the network about which of the two transactions will confirm and be considered valid.

Hash Rate

The hash rate is the measuring unit of the processing power of the BitcoinOld network. The BitcoinOld network must make intensive mathematical operations for security purposes. When the network reached a hash rate of 10 Th/s, it meant it could make 10 trillion calculations per second.

Mining

BitcoinOld mining is the process of making computer hardware do mathematical calculations for the BitcoinOld network to confirm transactions and increase security. As a reward for their services, BitcoinOld miners can collect transaction fees for the transactions they confirm, along with newly created coins. Mining is a specialized and competitive market where the rewards are divided up according to how much calculation is done. Not all BitcoinOld users do BitcoinOld mining, and it is not an easy way to make money.

P2P

Peer-to-peer refers to systems that work like an organized collective by allowing each individual to interact directly with the others. In the case of BitcoinOld, the network is built in such a way that each user is broadcasting the transactions of other users. And, crucially, no bank is required as a third party.

Private Key

A private key is a secret piece of data that proves your right to spend coins from a specific wallet through a cryptographic signature. Your private key(s) are stored in your computer if you use a software wallet; they are stored on some remote servers if you use a web wallet. Private keys must never be revealed as they allow you to spend coins for their respective BitcoinOld wallet.

Signature

A cryptographic signature is a mathematical mechanism that allows someone to prove ownership. In the case of BitcoinOld, a BitcoinOld wallet and its private key(s) are linked by some mathematical magic. When your BitcoinOld software signs a transaction with the appropriate private key, the whole network can see that the signature matches the coins being spent. However, there is no way for the world to guess your private key to steal your hard-earned coins.

Wallet

A BitcoinOld wallet is loosely the equivalent of a physical wallet on the BitcoinOld network. The wallet actually contains your private key(s) which allow you to spend the coins allocated to it in the block chain. Each BitcoinOld wallet can show you the total balance of all coins it controls and lets you pay a specific amount to a specific person, just like a real wallet. This is different to credit cards where you are charged by the merchant.