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Glossary

Auction

November 21, 2023 - Around 3 mins mins to read

What Is Auction?

An auction is a live event where a bidding mechanism is utilized to acquire a wide range of items, from antiques to real estate. The individual responsible for leading and directing the bidding process, known as the auctioneer, will propose an initial bid to the audience when an item is first presented at the auction.

Once the bidding process commences, interested parties compete to offer the highest bid price until no one is willing to continue. The highest bidder then becomes the owner of the asset after making the payment and receiving confirmation from the auctioneer.

In order to maximize the likelihood of a successful sale, auctions typically aim to attract a large number of potential bidders. This encourages higher offers and drives the bidding to higher levels.

While auctions have evolved over time, the fundamental principles have remained unchanged. The process often begins with a preview session, allowing potential buyers to assess the items they are interested in. To participate in the auction, bidders usually go through a formal registration system. Each bidder is assigned a unique bidding card upon registration.

Although most auctions follow an ascending order, there are also Dutch auctions that operate in reverse. These auctions start with a high price and gradually decrease until someone accepts the auctioneer’s offer and completes the transaction. In some cases, auctions may have a predetermined limit price, also known as a reservation or reserve price, which represents the minimum amount the item can be sold for.

Technological advancements, particularly online bidding platforms, have expanded the auction environment. These websites facilitate the buying and selling of various items. Users can upload images of their items, and others can place bids to acquire them. When the auction period ends, the highest bidder is contacted to arrange payment and shipment, similar to a traditional live auction.

Cryptocurrencies, such as BTC, can also be sold at auctions. BTC auctions are popular because they often offer lower prices than the market. These assets are typically seized from criminals in federal, civil, and administrative cases and are put up for auction.

Auctions present exciting investment opportunities, which has generated significant interest in the crypto world.

To participate in an auction, investors must register and place a winning bid. Once the auction for a specific cryptoasset concludes, the winning bidder must make payment through specified methods within a specified timeframe. Additionally, the winning bidder must have a digital wallet to receive the cryptoasset and may be responsible for transaction costs.

Electronic auctions, also known as e-auctions, are centralized and computerized platforms that facilitate the sale of various assets. However, they are vulnerable to exploitation and fraud due to their centralized nature.

An alternative to traditional electronic auctions is blockchain-based e-auction systems, which eliminate corruption and enhance security and efficiency.

In these systems, the data of each auction is recorded in the blockchain, and any modifications to the data are verified using secure cryptographic digital signatures. These signatures are broadcasted to a public blockchain for backup. The connection between servers is protected by a specific protocol. If any data is tampered with, the digital signature changes, allowing anyone to verify the bid information and preventing hacking attempts. The blockchain network promptly detects and rejects any malicious attempts to alter the digital signatures.

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Coincu

Glossary

Auction

What Is Auction?

An auction is a live event where a bidding mechanism is utilized to acquire a wide range of items, from antiques to real estate. The individual responsible for leading and directing the bidding process, known as the auctioneer, will propose an initial bid to the audience when an item is first presented at the auction.

Once the bidding process commences, interested parties compete to offer the highest bid price until no one is willing to continue. The highest bidder then becomes the owner of the asset after making the payment and receiving confirmation from the auctioneer.

In order to maximize the likelihood of a successful sale, auctions typically aim to attract a large number of potential bidders. This encourages higher offers and drives the bidding to higher levels.

While auctions have evolved over time, the fundamental principles have remained unchanged. The process often begins with a preview session, allowing potential buyers to assess the items they are interested in. To participate in the auction, bidders usually go through a formal registration system. Each bidder is assigned a unique bidding card upon registration.

Although most auctions follow an ascending order, there are also Dutch auctions that operate in reverse. These auctions start with a high price and gradually decrease until someone accepts the auctioneer’s offer and completes the transaction. In some cases, auctions may have a predetermined limit price, also known as a reservation or reserve price, which represents the minimum amount the item can be sold for.

Technological advancements, particularly online bidding platforms, have expanded the auction environment. These websites facilitate the buying and selling of various items. Users can upload images of their items, and others can place bids to acquire them. When the auction period ends, the highest bidder is contacted to arrange payment and shipment, similar to a traditional live auction.

Cryptocurrencies, such as BTC, can also be sold at auctions. BTC auctions are popular because they often offer lower prices than the market. These assets are typically seized from criminals in federal, civil, and administrative cases and are put up for auction.

Auctions present exciting investment opportunities, which has generated significant interest in the crypto world.

To participate in an auction, investors must register and place a winning bid. Once the auction for a specific cryptoasset concludes, the winning bidder must make payment through specified methods within a specified timeframe. Additionally, the winning bidder must have a digital wallet to receive the cryptoasset and may be responsible for transaction costs.

Electronic auctions, also known as e-auctions, are centralized and computerized platforms that facilitate the sale of various assets. However, they are vulnerable to exploitation and fraud due to their centralized nature.

An alternative to traditional electronic auctions is blockchain-based e-auction systems, which eliminate corruption and enhance security and efficiency.

In these systems, the data of each auction is recorded in the blockchain, and any modifications to the data are verified using secure cryptographic digital signatures. These signatures are broadcasted to a public blockchain for backup. The connection between servers is protected by a specific protocol. If any data is tampered with, the digital signature changes, allowing anyone to verify the bid information and preventing hacking attempts. The blockchain network promptly detects and rejects any malicious attempts to alter the digital signatures.

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