Bitcoin exists for more than 10 years, and this is a very respectable age for a cryptocurrency. During that time, hundreds and thousands of ambitious projects were born and passed away. In the first decade of its life, Bitcoin has served as humanity’s hope for getting rid of any monitoring by the monetary authorities, and almost the greatest crypto disappointment, and the phoenix rising from its own ashes. What did Bitcoin bring to the third decade of the 21st century, what are the prospects of it, and is it worth it to deal with now?
The Bitcoin blockchain remained virtually unchanged up to a certain point, for which it was occasionally criticized, which became a good basis for the growth of many other cryptocurrencies. As a result, in 2017, there was a massive upgrade on the Bitcoin network. We are talking about activating the SegWit protocol, which, on the one hand, solved the important problem of transaction plasticity, and on the other, removed the limit of each block size, which was limited to one megabyte all previous years. Another important change in the bitcoin network occurred a year and a half later with the start of the mass usage of bech32 addresses. These developments affected the size of transaction fees, which decreased very quickly. (up to 80 percent).
Building from these two decisions, an active development and implementation of software had progressed within the next two years. This was done in order to make the blockchain accessible for people, who do not have in-depth technical knowledge. Finally, it has been able to massively attract this category of users after the introduction of the Lightning Network microtransaction protocol, which was the basis of dozen of interesting applications: from wallets and stores to developer tools.
Another technology that can be considered as a serious step in the development of bitcoin blockchain is related to sidechains, a long-awaited technology, which allowed users to transfer coins between platforms with different protocols, thereby reducing both transaction time and associated risks. The technology has proved to be incredibly sought after and by the end of 2018 it was already used by several dozens of the largest cryptocurrency exchanges.
The evolution of the Bitcoin blockchain has not spared the cryptography issues, among other things. The implementation of the Schnorr signature and Taproot, which helped to reduce the size of blockchain data by approximately 25 percent, became one of the most significant events in this area over the last 10 years. The technological development of the Bitcoin blockchain, of course, is not limited by the projects and innovations described above. But it’s really hard to mention all of its changes in a blog article.
It is clear from the foregoing that the Bitcoin blockchain has been constantly evolving over the past few years. Yes, someone can say that changes are not happening as fast as we would like. But the developers would argue that there are only repeatedly tested, safe and effective solutions offered to users.
This circumstance, together with the economic crisis due to Covid-19, created good background for returning the interest of investors and miners to bitcoin as an object for investment and mining at the beginning of 2020. In connection with the pandemic, the bitcoin exchange rate reached values of 7 thousand dollars per coin, which is comfortable for miners. The appearance of new high-performance equipment on the market also led to the increased interest in cryptocurrency.
A major breakthrough occurred with the determination of the legal status of bitcoin. Yes, the governments and financial regulators of most countries have not yet decided how to treat cryptocurrencies, but at the same time, there solutions have appeared on the market that make it absolutely legal to purchase or rent special equipment and start to mine bitcoin. Such services are now offered by actively developing mining hotels, combining hundreds and thousands of farms under the same roof. In addition to their legality and safety, another important advantage of mining hotels is the special conditions for connecting to energy networks. For some projects, such as ECOS mining, a part of the capacities at hydroelectric power stations, thermal power plants or nuclear power plants is reserved under an agreement with power engineers. In the case of ECOS mining, we can tell about at least 200 megawatts reserved for it at the Hrazdan heat and power plant.