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Ever wonder how Bitcoin (and other cryptocurrencies) actually work?

66118 ratings | 2038022 views
Bitcoin explained from the viewpoint of inventing your own cryptocurrency. These in-depth videos are made possible by patreon: https://patreon.com/3blue1brown Protocol Labs: https://protocol.ai/ Interested in contributing? https://protocol.ai/join/ Special thanks to the following patrons: http://3b1b.co/btc-thanks Some people have asked if this channel accepts contributions in cryptocurrency form as an alternative to Patreon. As you might guess, the answer is yes :). Here are the relevant addresses: ETH: 0x88Fd7a2e9e0E616a5610B8BE5d5090DC6Bd55c25 BTC: 1DV4dhXEVhGELmDnRppADyMcyZgGHnCNJ BCH: qrr82t07zzq5uqgek422s8wwf953jj25c53lqctlnw LTC: LNPY2HEWv8igGckwKrYPbh9yD28XH3sm32 Supplement video: https://youtu.be/S9JGmA5_unY Music by Vincent Rubinetti: https://soundcloud.com/vincerubinetti/heartbeat Here are a few other resources I'd recommend: Original Bitcoin paper: https://bitcoin.org/bitcoin.pdf Block explorer: https://blockexplorer.com/ Blog post by Michael Nielsen: https://goo.gl/BW1RV3 (This is particularly good for understanding the details of what transactions look like, which is something this video did not cover) Video by CuriousInventor: https://youtu.be/Lx9zgZCMqXE Video by Anders Brownworth: https://youtu.be/_160oMzblY8 Ethereum white paper: https://goo.gl/XXZddT ------------------ 3blue1brown is a channel about animating math, in all senses of the word animate. And you know the drill with YouTube, if you want to stay posted on new videos, subscribe, and click the bell to receive notifications (if you're into that). If you are new to this channel and want to see more, a good place to start is this playlist: http://3b1b.co/recommended Various social media stuffs: Website: https://www.3blue1brown.com Twitter: https://twitter.com/3Blue1Brown Patreon: https://patreon.com/3blue1brown Facebook: https://www.facebook.com/3blue1brown Reddit: https://www.reddit.com/r/3Blue1Brown
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Text Comments (3264)
Himanshu Kesarwani (18 hours ago)
Best explanation of Blockchain and cryptocurrencies on Youtube. Please make more videos for the topics which are not covered.
Aphrodisiac Tresspasser (20 hours ago)
why is that when you're watching a video, you get an ad about the same subject? how does youtube know
Nima Pars (1 day ago)
Great video. Instantly subscribed. Thank you.
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Ghilman Faza (2 days ago)
can you make a video of how the ethereum network works, how is it different from bitcoin, how the solidity works inside the transaction, thank youu! your explanation is the best man
Satoshi Alpha (2 days ago)
Excelente video muy nítido contenido y nos quedamos pendiente a su canal muchas gracias
Euquila (2 days ago)
There is something deep and powerful about block chains that will affect civilization for a long time to come. I would put the level importance of this discovery the same as Einstein's relativity. However, I think this will be a slow impact (on the scale of decades).
0x1A3C3E7 (2 days ago)
If a block contains invalid transaction data, anyone who has an up to date copy of the blockchain can see that it's false. Only new peers, or peers who been offline for a while, are vulnerable to misinformation. Proof of work follows the simple realization that the truth is always older than a lie. Once you have the truth, the lies become obvious. I thumbed-up this video but, it really deserves 2^256 thumbs.
steve c (3 days ago)
A very good explanation. One issue that crypto holders will have is actually spending their crypto and until this is made easier it won't get mainstream adoption. One solution that requires no fees or being converted back to fiat is this upcoming platform called Zeex who have come up with an excellent solution for converting fiat to physical products. https://www.zeex.me/
Rayne Ma (3 days ago)
So, the longer the transaction history, the slower bitcoin becomes.
HyperVectra (3 days ago)
Well spoken, voice isn't annoying - very succinct, clear simple animation . Also how you move to the $$$ pitch, you do it smoothly and with class. This should be the benchmark all You Tubers should aim for. Hats off to you, Sir.
WDj (3 days ago)
Excellent explanation.
Razvan Porojan (3 days ago)
Excellent work!
Ryan Chapman (4 days ago)
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SiSTiCkA (5 days ago)
So that means you cannot pay with bitcoin without spending fee to include your transaction in the next block? So if you want to buy a 2 dollar object with BTC, you need to add 3.50 as a bribe basically to get it included?
turtlellamacow (6 days ago)
One question I still have, which might be a dumb question: what's the point of the block rewards? Is it just to give people an incentive to do the computational work of mining? (If the ledger is just a record of debts being transferred among users, why is there any need to increase the total size of the bitcoin supply in circulation?)
turtlellamacow (6 days ago)
Finally a satisfying explanation! Every other explanation I've heard has just raised more questions than it answered for me. I think the desire to simplify and draw analogies just obscures what's really going on; these mathematical details are necessary to understand it.
Scott T (6 days ago)
Best such video I've found....
Abhishek K (7 days ago)
Amazing! Well explained, neatly spoken. Best video I saw so far.
Razzi masroor (7 days ago)
21:00 unless alice owns google
Razzi masroor (7 days ago)
13:31 I would respond, is it 3Blue1Brown
Palash Jalan (7 days ago)
This guy is the best!!!!!! Thank god for people(like 3blue1brown) who want to educate as many people as possible
Tanzim Kabir (7 days ago)
One question, regarding miners getting paid. (18:35) Do the miners put in a transaction into the block and then encrypt that? Wouldn't that change the whole message? and wouldn't it change the requirement to meet? Like if a miner has to find a number to get 60 zeroes at the start, wouldn't it be changed if the miner adds a transaction to their name?
Niker107 (9 days ago)
I have two things I still don't quite understand. First of all, why does the transaction rate for bitcoin fluctuate so unpredictably, and what actually affects it? Second, if Alice doesn't want to write the additional statement giving money to the miner, would she ever be able to send money, and how does she know how much she must give to have her payment 'accepted'? And finally, how can Alice plainly say that she pays an extra fee for 'the miner' without saying who the miner is? Surely if he wanted to write his own ID into the transaction, Alice's signature would no longer work?
Anicool Singh (9 days ago)
10 minutes up.. Let's take a break.. And relax
Amyn Farooqui (9 days ago)
Really I agree...amazing video!
ashesh shrestha (11 days ago)
finally I understand how bitcoin works
Vaidyula g s roy (11 days ago)
excellent video.  broadened my understanding.  Thank you so much
Joao Semedo (11 days ago)
Great great video!! Thank you very much :)
Priyamvada Singh (12 days ago)
Please, please do an in-depth series on blockchain tech and related topics. Great video!
thank for your video
RANI BHATI (13 days ago)
do check this out as well .. fuglysearchers.blogspot.com/2018/06/cryptocurrency.html for more info
Nagaraj Bhadrannavar (13 days ago)
1 ETH Giveaway 🔥 | Next Crypto Giveaway on 300+ Subs | Crypto Khabri https://www.youtube.com/watch?v=gwQNp7Mvj9g&t=197s
ggoH (13 days ago)
So if one company were to gain more than 50% of the computational power could the produce a fraudulent chain?
J.J. Shank (5 days ago)
Possibly yes, although even the largest companies in the world own only a small fraction of the world's computational power. Most of that power lies with us, the billions of average consumers.
Sinhel productions (14 days ago)
one world currency = Fuck that!
Veronica Saldana (14 days ago)
Awesome video! Thank you very very much! You have a perfect voice for this!
Bracer Jack (14 days ago)
This is a detail technical explanation of how the Blockchain actually work: https://www.youtube.com/watch?v=FeeVuqO1M6k
mathew spencer (14 days ago)
thank you so much .....i get it now ...finally
nik vamv (14 days ago)
Very nice explanation. One question when you said that Alice is trying to fool Bob with a fraudulent block, how can she broadcast the block if the initial transaction has not been signed by Bob, at 20:00
The True (15 days ago)
The block chain consists of lines of problem solving code in servers connected together into one monolithic mega computer that is growing each day. They use ice caves to keep the servers cool and operations costs down, meaning they need less power and likely can run independently. Where this used for the purpose of creating a super AI, why keep quiet and be vague about what you're doing? Shady in my opinion.
Wilkong (15 days ago)
So, what if i made a transaction and that transaction hadn't been included into new block that miners signed with the new number - where does it go? Is there some queue, or i should redo my transaction? What if miners are simultaneously working on finding a number for different versions of blockchain, where is the guarantee that my transaction will be in the main blockchain and will not be ignored as a part of faulty chain? How do miner agree upon on what stack of transactions they are working on? What happens if there are transactions made during the computation of a new number? Do they add it to block and start over? Or do they start the "finding" process only when the whole block(2400 records) is ready?
Crypto Blockhead (16 days ago)
Brilliant video, this is the first time after many video searches, that the blockchain is starting to make sense. Thank you so much for sharing
Bean David (17 days ago)
So what happens if Alice doesn't want to validate it? And no one yet has told us where the basis for this invisible crypto is? You just jump into the middle as if it is real. And when people later say it isn't real and it crashes....then what? The day will come.
J.J. Shank (4 days ago)
Why would you withdraw "actual money"? How is paying with "actual money" any different from paying electronically?
Bean David (5 days ago)
I don't agree. This looks like the latest of pyramid schemes. Am I able to withdraw actual money with an ATM card?
J.J. Shank (5 days ago)
What's the basis for _any_ currency? Gold? Silver? Cowry shells? For cryptocurrencies, that backing is computational power, which I think we can all agree is becoming more and more important.
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nevel _ (17 days ago)
Advanced video about a new open-source concensus protocol. Better than blockchain https://medium.com/safenetwork/parsec-a-paradigm-shift-for-asynchronous-and-permissionless-consensus-e312d721f9d8
Joseph Todd (18 days ago)
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theFizzyNator (18 days ago)
πcoin when
Artem S (18 days ago)
well done. thanks!
BrutalFN (18 days ago)
is this dude casually explained
Justin D (18 days ago)
Very interesting and informing video, as usual. What would stop a person from incentivising miners with a high reward numerous times to create fake chains?
J.J. Shank (5 days ago)
The limits of their wallets. You can't bribe everyone forever.
Rey Anthony Villena (19 days ago)
thanks a lot! ilove it!
WattanaPui (19 days ago)
There's a stolen copy of your video on YT by someone who wants to make money by referral clicks, you should report it
Krokan95 (19 days ago)
So 1) If it takes 10m to verify a transaction, how is the network so fast? 2) If (after all the bitcoins are mined), it’s gonna cost a transaction fee to send bitcoin, then what is the point of levering it as a currency? (Even overlooking the fact that it’s so volatile) Is’nt one of the main arguments for BTC lower transaction fees? And banks already have none (except overseas ofc)
J.J. Shank (5 days ago)
It takes ten minutes to mine a new block. It takes almost no time to verify transactions.
Zachary Hunter (20 days ago)
small nit pick. in your hash with sixty zeroes, there's actually two more right after which you don't make yellow. 17:46
poketopa1234 (21 days ago)
QUESTION: What if a peer goes offline and does not receive a block? Won't they be out of the loop, unable to match their previous hash with the headers of new incoming blocks? How do they "catchup" without miners having to send the entire blockchain every time they add a new block? You can assume I know most of the technical protocols of how cryptocurrencies work, I'm just confused by this aspect. Thanks!!!
Tommy Dancer (22 days ago)
Definitely some of the best math videos on the web, and especially on these kind of topics. I absolutely love this, as any reasonably invested math enthusiasts probably will. Excellent animation, explanation, and pacing! <3 <3
Tom K (22 days ago)
Amazing video! Thanks a lot!
Jacqueline Rogers (23 days ago)
I'll be honest while I didn't understand quite everything but I understood more than from other videos. Really appreciated the straightforwardness of the presentation. It gave me the basics and I can go on from there.
Sumit Dargan (24 days ago)
Amazing work !
irack alanís (25 days ago)
Excelentísimo video, la verdad es que me parece un trabajo completamente bien hecho. La simple idea de que haya yo haya comprendido de qué se tratan todos estos procesos denota lo bien que está este video.
Pedro Pinto (25 days ago)
with the amount of time it takes to mine a new block for bitcoin being rather high, would it be "more profitable" to mine another crypto currency like etherium, which has a much lower value but also a much shorter average block time?
Jannis Adamek (25 days ago)
oh Charly
Flor Debois (25 days ago)
Very good video it really helped me tanks a lot
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Nick Folley (26 days ago)
Im interested, what is a "tip with crypto link"
SpeedyDucky (26 days ago)
But how did the first bitcoin get created like on the reward of the first block in the block chain??
Matt Lister (27 days ago)
Anyone know the significance of this channel’s name? Been wondering for a while
Jin Literatus (27 days ago)
Super helpful video! Thank you! What's your opinion about SciDex? I've been following them for a while now!
Mazarona surname (28 days ago)
It took me 2 hours to get through this video feelsbadman. but its worth it .
Patrick Lindsey (28 days ago)
And the energy consumption associated with all of this is obscene. It's not sustainable, and will eventually be regulated into oblivion.
Mann Fred (29 days ago)
I totally love your videos! Thank you allot for all the work you put in it.
Saki630 (29 days ago)
coins can go suck it cuz its ridiculous that I still would have to pay more than MSRP for a gpu that is 2 years old! I despise the thought that these 0's and 1's are 'valued' at such a high dollar amount and that there exists 'crypto currency experts' as if it requires some sort of godlike power to not realize people are just laundering money and pumping up the price of turds by enticing new buyers of huge rewards.
james phan (29 days ago)
You have a gift. This is very difficult technology to explain. I have a solid understanding of blockchain, but struggle to explain it to laypersons. You are needed, desperately. Keep it up!
Mehdi Saffar (30 days ago)
1) In the proof of work, is it guaranteed that it is possible to find a certain number that when hashed with any transaction list will give x zeros at the start of the hash? 2) I believe that the bitcoin protocol increases the number of zeroes required to consider a block of transactions valid. What happens if the number of zeroes reaches very close to 256 bits or equals that? 3) Is it possible for a block creator to reward himself more money that he should? Since all the other listeners will verify that the block's hash starts with x required zeroes? Please keep making videos like these. They are amazing!
Habeev07 (30 days ago)
Nobel Prize-winning Economist, Milton Friedman, 1999: "I think that the internet is going to be one of the major forces for reducing the role of the gov't. The one thing that's missing, but that will soon be developed, is a reliable 'E-Cash'. A method whereby, on the internet, you can transfer funds from A to B, without A knowing B or B knowing A". What a brilliant mind. This is the 20-30 y/o's chance (but really anyone's chance) to do what their parents and grandparents and great great great grandparents couldn't accomplish. OF THE PEOPLE, BY THE PEOPLE, FOR THE PEOPLE. We can change the monetary system in our lifetime. Gold, Silver, BTC, and LTC forever. I'm of the generation who graduated HS when the 07-09' recession hit. Going to college with 6 dollar fuel was not possible. Such a small window. Needed to work right out of school than go and still cannot afford schooling. I don't believe in student loans, want to stay sovereign. God gives the toughest battles to his strongest soldiers. God Bless. BTC: 17CGxdjDvPWCohQXFARPmnkEkTG8eLbtFt LTC: LTouRbMC9SrEeQPU5g541Q98pU8vqyAYTf
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Somebody sure watched this video... now I get 3 different cryptocurrency ads on 3 videos... everybody wanna be starting somecrypto ey. \o/
Ernest Zamelczyk (30 days ago)
Wow. You're backed by Notch on Patreon. Cool.
Clifford Hodge (1 month ago)
It seems like trust is not rendered unnecessary,  but simply re-assigned.  I take it the complete cumulative ledger is only held in the databases of miners.  My computer couldn't keep storing away all that data.  So what if some catastrophic, or simply unforeseen, event results in the withdrawal of all the miners, and their databases disappear?
J.J. Shank (30 days ago)
If all the world's miners and databases disappear, we've lost a lot more than just our currency.
Lo folo (1 month ago)
well done
Claudio Digion (1 month ago)
I lost a lot of money because I speculated. Since I use this Trading Signals I can almost live on my profits. https://discord.gg/jnTXAZg
thapakazi (1 month ago)
Can you make a cast ( or know someone who would love to explain) on this cryptography terms and algorithm used in bitcoin or ethereum, I mean to explain Elliptic Curve Digital Signature Algorithm (ECDSA) and the curve (secp256k1) used inside them? Thanks
Jake Higginbotham (1 month ago)
Nice Job. I finally understand. Most people are like oh yeah just download that app and hit start.
you're right (1 month ago)
No one knows who invented it huh? So how do you know the bankers didn't invent it?
J.J. Shank (30 days ago)
Jesus could have invented it. Wouldn't matter.
rodrigo salonga jr. (1 month ago)
You explain very clearly. Can you do a video about new ICOs too? I'm interested specifically in SciDex.
python animalia (1 month ago)
Probably watching this for 3rd or 4th time. I am getting there.
Ellis Constantine (1 month ago)
cryptos will be the next dollar a global coin, the one to rule them all Its suspicius how this fits in the New World Order agenda as no one knoks who satoshi is
J.J. Shank (30 days ago)
You can dismiss anything if all you do is claim it fits the NWO agenda, no effort necessary!
Maximilian Wolter (1 month ago)
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This is serious
J.J. Shank (30 days ago)
This is serious
Ramiro Estevez (1 month ago)
3blue1brown is satoshi
Àleifr Klingfjordr (1 month ago)
Wow. This was really well done
Bb Anon (1 month ago)
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Dani Feldman (1 month ago)
Do not know what to think... A quantum computer can very easily win this computational work and beat the ciptography also. I am afraid of they can guess any hash within seconds, while a classic computer needs years to achive the same. It is unfair.
J.J. Shank (30 days ago)
1) We don't have quantum computers yet. 2) There exist quantum hash functions that can't be solved even with quantum algorithms.
Styil (1 month ago)
No, hashing algorithms are quite safe from quantum. Digital signatures are not however and that is a bigger problem.
Tomi ★ d i z Z e (1 month ago)
it just makes me amazed how much of work did you put into this video. thanks a lot!
The God Kratos (1 month ago)
Colt (1 month ago)
Very cool. I was learning recently about public key algorithms and hashing but never knew how cryptocurrencies work.
Provash Ghotak (1 month ago)
Awesome video man! What's your opinion about SciDex?!

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