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Topic Of A Day (TOAD)
Topic Of A Day (TOAD)
A little bit of everything from science to faith, finance to fitness. Good ideas don't require violence.
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Jakers
Jakers

Cryptography and Cryptocurrency Part 2

2/7/2018 6:53:19 AM   |   Comments: 2   |   Views: 68
FULL Disclosure. I am not a financial advisor nor is this post to be construed as financial advice. 

If you haven't read my previous blog post, I recommend you read that one first before continuing, especially the first half of the video that explains what hashing algorithms are.

With that said, what are cryptocoins? Cryptocurrencies are essentially a public ledger (more on that in the video) that keeps track of who spent what. Each transaction is kept on a ledger that is publicly accessible via the "blockchain." A block of a blockchain is a group of transactions that get written to the blockchain to get written into history, essentially.  

Decentralization: Most coins are decentralized to some extent. This just means that anyone with the right equipment can start "mining" or "forging" coins. That means verifying the transactions on the network and "writing them into history" This video describes the basics of crypto very well.


Proof of Work vs Delegated Proof of Stake 

Heres the fun part (In my humble opinion)

So how do you determine WHO gets to write transactions into the blockchain? Well long story short, with proof of work algorithms lots of people race to undo a hashing algorithm and the first one who succeeds broadcasts that block with an additional entry into their own "wallet" (wallet is just a secret code that lets you spend your money on the network).  Then the longest chain then is the "real" one.  The problem is that all this computational power is that it costs lots of real world resources to maintain, silicon and other computer tech in the form of special chips made to mine them as well as a ton of electricity. 

Enter DPoS - Distributed Proof of Stake. 

This in my opinion, is the algorithm that will save cryptocurrency. In DPos, a number of delegates work to listen to transactions and each agree with each other and get rewarded with coins for doing so. Ark coin, which is currently my favorite coin, has 51 delegates. How does someone become a delegate? They literally have to campaign like a politician, but unlike a politician if they dont maintain enough votes, they automatically get voted out. You vote for someone by sending them a coin as a vote and then the number of coins you own determines the weight of your vote. This short video explains it well.




Stay tuned for more about Ark and the Ark ecosystem. I truly believe this coin will be the antidote to energy wasting slow inefficient cryptocoins and will allow we the people to create a money system that isn't influenced as much by politics, wars, and resources. I highly recommend reading their whitepaper at Ark.io

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