Architecture and mining

Architecture. Decentralized cryptocurrencies are produced collectively throughout the system, at a publicly known radio that is specified when that system is created. In central banks and traditional economic systems, governments control the amount of coins in the market (for example, by printing money or by requiring additions to accounting books). In the case of decentralized cryptocurrencies, companies or governments can not produce new units. Cryptocurrencies also do not have an asset behind that supports their value, unlike traditional currencies. The current system is based on the individual or group known as Satoshi Nakamoto. In May of 2018 there were about 1800 cryptocurrencies. In a cryptocurrency system, the integrity, security and balance of the accounts is maintained by a community known as the miners. This community uses their computers or other specialized hardware to validate and date transactions, adding them to a collective database. Many cryptocurrencies are designed to gradually decrease the production of units, imposing a limit on the total number of units that may be in circulation. Compared to traditional monetary systems, cryptocurrencies are more difficult to legislate due to the cryptography used in the system. Block chain The validity of each of the units is in the chain of blocks. A chain of blocks is a constantly growing list of records, called blocks, that are linked and secured using cryptography. Each block contains a hash pointer linking to a previous block, a date and transaction data. By design, block chains are inherently resistant to data modification. The chain of blocks is an "open, public, distributed book that records all transactions between two users in a permanent and verifiable manner". The chain of blocks is usually managed by a collective point-to-point network with a common protocol to add and validate new blocks. Once registered, the data of any block can not be modified without altering all the following blocks. Block chains are safe by design and are an example of a distributed system with a high tolerance for Byzantine faults. The decentralized consensus has been achieved thanks to the chain of blocks. Block chains solve the problem of double spending without the need for a certified authority or a central server, assuming that the 51% attack is not going to happen (which has worked with several cryptocurrencies). Dated. Cryptocurrencies use several dating systems to "prove" the validity of transactions added to the block chain without the need for a third authorized actor. The first one invented was the work test system. The most used systems are based on the algorithm SHA-256 and scrypt. Other algorithms that have been used can be CryptoNight, Blake, SHA-3, and X11. Another system, proof of participation, is a method to ensure the network of reaching a distributed consensus by asking the users to own a small part of the units. It differs from the work test system in that they do not have to execute very complicated hashing algorithms to validate transactions. The system changes a lot depending on the currency and currently there is no standard. Some cryptocurrencies use a combined system between the two. Mining In cryptocurrency networks, mining is a validation of transactions. By this effort, the miners obtain units as a reward. This reward decreases fees, creating a complementary incentive to contribute to the network's processing power. The ratio of generating new hashes that validate any transaction has been increased by the use of specialized machines such as FPGAs and ASICs. This race for cheap and efficient machines has existed since the days of the first cryptocurrency, bitcoin, which was introduced in 2009. The more people who have ventured into the world of cryptocurrencies, the complexity of the generation hashes has increased as over the years, making miners have to invest large amounts of money in specialized machines. Sometimes, the value of the units obtained did not justify the investment in machines, the cooling of these and the energy consumed to make them work. Hern, Alex (January 17, 2018). «Bitcoin's energy usage is huge - we can not afford to ignore it».