You have probably heard of Bitcoin due to its wildly volatile price making headlines but there is so much more to the story as Bitcoin is the first and most famous digital cryptocurrency in the world.
Bitcoin was invented in 2009 by Satoshi Nakamoto whose’ stated goal was to create a purely peer-to-peer version of electronic cash that would allow online payments to be sent directly from one party to another without going through a financial institution (bank).
The anonymous Satoshi, who could be male, female or even a group of people or companies chose to disappear in 2011 after one of the lead Bitcoin developers agreed to meet with the US Central Intelligence Agency to do a Bitcoin presentation.
Satoshi left the source code of Bitcoin and gave it to the world. Since its inception developers have been regularly improving on and adding to this code allowing it to slowly and safely evolve.
What is Bitcoin?
Bitcoin is a digital currency, no notes are printed or physical coins minted. However, it shares many of the same properties of normal currencies but improves upon them in the following ways:
No governments or institutions control Bitcoin. The integrity of transactions and security of the network is maintained by a worldwide distributed open computer network that anyone can join.
Normal currencies have an unlimited supply as central banks can just issue more and devalue the currency as history proves they regularly do. The creation of bitcoins are controlled by the code so there will only ever be 21 million in existence.
Users are not identified by their names but by public addresses that do not need any identity verification. Transactions can, with some effort be tracked as all transactions are publicly viewable.
Once a transaction has been confirmed on the network then it can never be undone, returned or tampered with because there is no central authority or code that allows this.
Bitcoins are divisible to 8 decimal places meaning the smallest unit is 0.00000001 and is called a Satoshi. 1 Satoshi is one hundred millionth of a bitcoin.
How is all this possible? It’s all about the Blockchain.