Bitcoin, Litecoin and Ehtereum
Bitcoin is a peer-to-peer payment system that uses the same unit for transactions and the data transfer protocol of the same name. To ensure the functioning and protection of the system, cryptographic methods are used. All information about transactions between system addresses is available in a clear format.
The minimum transmittable value (the smallest amount of fragmentation) is the 10 ^ -8 part of a bitcoin and is called "Satoshi" in honor of the creator Satoshi Nakamoto. Although he himself used the word "cent" in such cases.
The electronic payment between the two parties takes place without intermediaries and is irreversible - there is no mechanism for the cancellation of the confirmed transaction (including the cases where the payment was sent to a wrong or non-existent address or if the transaction is a private one) Key was signed, the other was known). No one can block the funds (by seizure, for example), even temporarily, except by the owner of the private key (or the person who knows him).
But the technology of multi-signature makes it possible to involve a third party and to realize "reversible transactions". Using a special scripting language, it is possible to implement other variants of Smart Contracts. However, they are not available in the GUI and are missing in the Turing completeness. In contrast, the newer blockchains, such as Ethereum.
Different authors classify Bitcoin differently. The most common options: cryptocurrency, virtual currency, digital currency, electronic money. Since the introduction of futures trading in CBOE at the end of 2017, has also been referred to as commodity.
Bitcoins can be used to buy goods or services. The exchange into a Fiat currency takes place on an online exchange for digital currencies, at other payment systems, change points or directly between interested parties.
The commission for the execution of the business is nominated by the sender voluntarily, the size of the commission influences the priority in the execution of the transaction. Typically, the client program requests the recommended commission amount. Transactions without commission are possible and are also processed, but are not recommended because the processing time is unknown and can be quite large.
One of the main features of the system is complete decentralization: there is no central administrator or one of its analogues.
Litecoin is a fork of Bitcoin, a peer-to-peer electronic payment system using the eponymous cryptocurrency. Litecoin was the second Bitcoin Fork after Namecoin and has little difference. Litecoin can be used for the electronic payment of goods or services. To ensure the functioning and protection of the system, cryptographic methods are used. In May 2017, SegWit support was activated in the Litecoin software.
In the Bitcoin and Litecoin networks, the data is recorded in the same way - as a linked chain of blocks (in the blockchain), each containing a hash of the previous one. The difference lies only in the function with which the hash is found (with Litecoin - scrypt, with Bit Coin - SHA-256).
In the Litecoin network, transactions, as with other crypto currencies, indicate that a certain amount of cryptocurrency is transferred from one address to another. The Litecoin address is formed on the basis of a public key using the hashing algorithm. Litecoin addresses consist of 33 characters starting with the letter L or the number 3.
After adding the SegWit support to Litecoin in April 2017, the addresses starting with "M" began to correspond with the addresses with a 3. With the help of a special converter, it is possible to mutually convert the addresses of these two formats.
The complexity of calculating Litecoin is chosen to average about 2.5 minutes per block, which is 4 times faster than Bitcoin. This allows a faster transaction confirmation. Transaction speed increased significantly after SegWit was activated in the Lightcoin network.
Ethereum is a platform for creating distributed online services (the DApps) based on blockchain. The Dapps are also based on the intelligent contracts, the so-called Smart Contracts. The project is implemented as a single distributed virtual machine. It was proposed by the founder of the magazine Bitcoin Magazine Vitalik Buterin at the end of 2013 and went online on July 30, 2015.
The small unit of ethereum is called ether. The Ethereum platform can be used with the help of "smart contracts" in various financial areas, but above all, the ether is a cryptocurrency. Various organizations have expressed interest in the platform, including Microsoft, IBM and JPMorgan Chase. Bloomberg Businessweek claims that the project's decentralized software can be used by anyone who needs protection against unauthorized interference. According to the text of the publication: "You can certainly do business with someone you do not know because the terms are stated in a smart contract and blockchain".