SECURITY ~ Difference between Blockchain and Bitcoin
Whenever we talk about bitcoin and blockchain, people usually think they are the same, because bitcoin is the first application of blockchain. People usually get confused between blockchain and bitcoin.
What is Bitcoin?
Bitcoin is a crypto-currency, a type of digital money. It is a decentralized currency with no central bank or administrator and can be sent from one user to another user through the Bitcoin network, without going through intermediaries.
What is Blockchain?
Blockchain initially locks in a growing chain of records, called blocks, that are connected using cryptography. Each block contains a cryptographic hash of the previous block, a timestamp and transaction information.
The blockchain can be used for mass computing for scientific and medical research or for compiling large amounts of marketing and other data. This is what happens with all ICOs (Initial coin offerings). Theoretically, these are all new technologies designed to improve existing blockchains or to create new ones.
Key difference between Bitcoin and Blockchain:
- Blockchain technology allows funds to be transferred anywhere in the world, securely, cheaply and in minutes.
- Blockchain technology is very flexible and advanced, with the ability to adapt to any business model and provide solutions to accessible problems.
- Blockchain applies the Proof-of-Work algorithm to validate the process. Any user must develop a PoW (Proof of work).
- Bitcoin transactions are stored and transferred via a distributed ledger on an open, public and unidentified peer-to-peer network.
When Bitcoin users want to convert their Bitcoins into fiat currency, they can use crypto-currency exchanges to process them into fiat currency or other crypto-currencies.
In short:
Bitcoin is a digital currency that can also be called crypto-currency. It was created mainly to speed up cross-border transactions, to reduce government control over the transaction and to simplify the whole process without going through third-party intermediaries. While blockchain is a type of ledger that records all transactions and facilitates peer-to-peer transactions. It is open, secure and easily accessible to all.
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