The bitcoin price has surged over recent months as interest surrounding social media giant Facebook’s planned libra project reached fever-pitch but has swung wildly as global regulators poured cold water on Facebook’s ambitions.
Libra’s mission is to enable a simple global currency and financial infrastructure that empowers billions of people.
The distributed database created by blockchain technology has a fundamentally different digital backbone. This is also the most distinct and important feature of blockchain technology.
In traditional fiat money systems, governments simply print more money when they need to. But in bitcoin, money isn’t printed at all – it is discovered. Computers around the world ‘mine’ for coins by competing with each other.
At its most basic, a fork is what happens when a blockchain diverges into two potential paths forward — either with regard to a network’s transaction history or a new rule in deciding what makes a transaction valid.
Bitcoin is built on a blockchain system. This means that transactions using Bitcoin are processed by being placed in blocks and then added to the chain. Each block contains just 1MB of information, which limits the amount of transactions that can be placed on each block.