Hey everyone. Welcome back to the course. In the last lecture, we discussed how you can build your blockchain ecosystem. And we also talked about the significant components of the blockchain ecosystem. One of the significant parts of the blockchain ecosystem is the blockchain projects. In this lecture, we are going to discuss about some of the top blockchain projects, and also compare their pros and cons.
Let's start with the Pioneer project Bitcoin, which started the whole blockchain phenomenon. Bitcoin is a cryptocurrency and digital payment system, which is globally known. It was first launched in 2009 as an open source platform by an anonymous person known as Satoshi Nakamoto. Bitcoin is a peer to peer system Where the transactions take place directly between the users without any need for a middleman or a trusted third party, the nodes or the computers which are part of the network, verify the transactions and record them in a public distributed ledger, which is known as blockchain. Bitcoin is a major currency, and in the year 2017, the price of bitcoin almost reached 20,000 US dollars. Bitcoin provides us with a solution where we can directly use the public blockchain to send the transactions if required.
We can also create private blockchain to serve our needs. Bitcoin works on the proof of work algorithm. The complexity of proof of work algorithm has increased tenfold in recent times. That's why the transaction process is slow. Over the Bitcoin public chain, Bitcoin provides a throughput of about seven to 10 transactions per second. Now let's see some more features of Bitcoin and how it is different from fiat currency.
The first feature differentiating Bitcoin is the decentralized nature of the Bitcoin blockchain. Bitcoin is not controlled by anybody, the nodes or the computers connected in the network, make sure that the data is protected from any modification by anyone. The setup process over Bitcoin blockchain is relatively much more comfortable than the traditional technologies. Regular banks make you go through a lot of procedures to open an account. But with Bitcoin blockchain, the configuration process is free and straightforward. Even if You wish to set up a node, you only need to run the daemon tools which are provided as binaries over your computer and get started with Bitcoin blockchain.
The third most important feature is the anonymity and transparent usage. users who are working with Bitcoin are granted complete transparency of all the transactions and procedures happening throughout the system. People over the Bitcoin blockchain won't be able to see the identity of the participants at all. However, they can look at the addresses and the digital signature of the people over the blockchain. There is no linking between the addresses and the person using the address. That's the same case as the one in which we can see the transactions done by Satoshi Nakamoto But still never been able to identify him.
Every transaction in Bitcoin is recorded onto an immutable ledger, which is known as blockchain. The fourth major feature is the mega transaction fees. Bitcoin charges typically a minimal fee for transactions, which is around 0.00001 BTC for one kilobyte of data. This is quite low compared to the other central authorities and traditional services like banks. However, the price of bitcoin went so high that you might find this fees almost equal to traditional services. But even if you compare them for a more substantial amount of money, the fee still is quite small.
The fifth major feature is the fast network process. If we use traditional services are fiat currencies, it may take days to transit a large amount, but with Bitcoin, it will take very less amount of time to process the transaction. Although the current state of Bitcoin will take time to process the transaction, as the difficulty has increased a lot if you create a private solution with Bitcoin Core under a bank, then the transaction won't take that much of time. One more feature of Bitcoin is that Bitcoin is non refundable. Once you send your bitcoins you won't be able to refund them back. Bitcoin is the first blockchain which started everything and came up with the concept of blockchain which we know now.
Bitcoin blockchain is like a ledger. We store the immutable transactions on other projects soon followed the suit after Bitcoin learning from the mistakes Made by Bitcoin and building on top of the Bitcoin limitations. Now let's discuss the second most famous project for blockchain which is aetherium.