Talk about the latest buzzwords in the fiscal scene today and Bitcoin tops the chart with élan. It is the first ever digital coin to bring the crypto industry to light and is considered to be the biggest cryptocurrency ever. Although Bitcoin was initially not considered to be a part of mainstream financial market yet it’s increasingly being perceived as a highly potential financial vehicle today. In fact, according to some experts, BTC or crypto is the new gold.
What is Bitcoin and who invented it?
Bitcoin can be defined as a cryptocurrency. Abbreviated as “BTC”, it’s decentralized virtual currency, that, unlike regular fiat currency, is not governed by any single administrator or some central bank. Bitcoin is generated, distributed as well as traded & stored in a decentralized ledger structure called “blockchain”. Bitcoin is a global currency and can be used to transfer money all across the world and that too at a faster speed and lower rate compared to traditional systems of money transfer.
When was Bitcoin invented? Well, Bitcoin’s invention dates back to 2008. The revolutionary coin was invented by Satoshi Nakamoto whose identity is still not known to the world. According to some, Nakamoto is a highly talented developer while some believe it’s an anonymous group of developers.
In 2008, Satoshi Nakamoto released a path-breaking whitepaper introducing Bitcoin which he referred to as a “P2P electronic cash”. After a few months, he released the first software of Bitcoin and teamed up with coders and developers to enhance it. The collaboration continued till 2011 but then, suddenly, without any notification, Nakamoto just vanished. Prior to his disappearance, he cut off all communication channels so that he can’t be reached to. He just left a mail to a fellow BTC developer saying he is shifting to some other stuff.
However, Nakamoto managed to gather around $5 billion Bitcoin before his disappearance.
How are Bitcoins generated?
Before getting into Bitcoin generation, it should be stated that Bitcoin is a finite resource like gold. There are 21 million BTC coins which will be mined up by 2040.
Bitcoin is not printed on paper or minted. It is generated through “mining” which is based on Proof-of-Work protocol. Interested miners would have to solve challenging computational puzzles to discover new block. The newly discovered blockchain would be added to existing blockchain structure. New Bitcoins are issued and rewarded to miners for adding blocks to blockchain.
As mentioned previously, Bitcoin is developed on Blockchain network. The Blockchain network sits on a web of nodes which assures integrity of the transaction history via achieving consensus. In other words, validation is a major aspect of the whole process. After a transaction is validated, nodes will have to race to resolve tough mathematical puzzles which again demand high-end computing resources. And, the very first computer machine in that network which gets to resolve the equation is awarded with Bitcoins. The whole process is called Bitcoin mining.
Fun facts about Bitcoin
- Bitcoin can be used to purchase just anything in the world, provided the merchant accepts BTC payment. The first material transaction of Bitcoin was made in the USA for 2 pizzas
- The US houses the maximum number of ATMs for BTC
- 80% of BTC has already been mined
- Bitcoin has been through several bearish trends over the past years but it manages to rise up and dominate the crypto market
David Robson is the founder of Complus Alliance. He has been writing about different topics for almost 10 years. He’s main focus is delivering quality insights to a wide array of audience.