This report delves into the realm of blockchain technology and its application in cryptocurrencies, primarily focusing on Bitcoin and Ethereum. The introduction highlights blockchain's role in enhancing security within various innovative fields, emphasizing its initial use in securing cryptocurrencies. The discussion section compares Bitcoin and Ethereum, detailing their distinct features, working models, and scalability issues. Bitcoin, introduced in 2008, and Ethereum, launched in 2015, both serve as platforms for virtual currency transactions, with Ethereum offering greater flexibility through smart contracts and faster transaction protocols. The report further examines the working principles of both cryptocurrencies, including Bitcoin's wallet system, blockchain ledger, transaction processes using private keys, and mining procedures. Ethereum's structure, mirroring Bitcoin's, utilizes smart contracts and account-based transactions. Scalability issues, particularly block size limits in Bitcoin, are analyzed. The report also explores the features and weaknesses of both cryptocurrencies, including the difficulty in understanding their operations, the absence of reverse payments, and security concerns. The socio-technical aspects of cryptocurrency adoption and the potential benefits of mitigating their weaknesses are also discussed. The conclusion summarizes the application of blockchain in cryptocurrencies and emphasizes the importance of addressing their weaknesses for wider acceptance.
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