Bitcoins have been a hot topic for more than a decade now! Despite this, many don’t know the origin or the purpose of it. But before we get into the technicalities of what a Bitcoin is, here’s a brief understanding of the term they’re affiliated with.
Bitcoins are a part of a currency group, called cryptocurrency. What is a cryptocurrency? It is a digital or virtual currency that best works as a medium of exchange. So how does it work? Well, it helps control the variation of new units of a particular cryptocurrency, while also securing and verifying transactions by using cryptography. However, there is a limit to the entries in the database, which can’t change unless they fulfil the specific conditions.
So what does that mean? Let’s find out!
Cryptocurrency has been around for an incredibly long time. So much so, that there have been several failed attempts of creating digital currency in the 90s. Systems like Flooz, Beenz, and DigiCash made their way to the market with a bang, but couldn’t stick around for too long owing to reasons like financial problems, fraud and more!
A trusted third party would carry out these processes. But despite that, the currency fell flat on its face and disappeared for quite some time!
However, programmers under the alias’ of Satoshi Nakamoto and Martti Malmi registered a domain, bitcoin.org in August 2008. Some even claim that it was 2009 when the alias Satoshi Nakamoto was used by itself, describing it as a ‘peer-to-peer electronic cash system’. This means that there are no middlemen present, meaning no banks! Managing transactions and issuing of the same are collectively carried out by a system!
Satoshi Nakamoto and late Hal Finney, an early cryptocurrency enthusiast and a developer, were responsible for the first-ever transaction back in January 2009. And, to this day, no one knows who Satoshi Nakamoto is. From false accusations to an illegal platform, it is now essential to find out who was behind this!
Bitcoins started as, and continue to remain open-source, everyone can indulge in it. Everything from its design to its function is open to the public! However, there aren’t any physical objects, everything-including balances are kept on a ledger accessible by the public that’s verified by a massive amount of computing power.
Bitcoin has been a controversial topic for a number of years now, however, over the past few months this volatile cryptocurrency has been the centre of attention for media outlets across the globe. But what has caused this exponential influx of notability? Well, Bitcoin has received this traction due to the massive increase in its value, rocketing from $18,000 per coin in December of 2020 to over $56,000 by February of 2021!
Although a lot of people now know what Bitcoin is, the majority of them do not understand its origin, purpose, or how it works. You can get more detail on these aspects and many more through our other ‘learn’ pages. This introduction page is solely to illustrate some base level context around Bitcoin and our organisation.
What is Bitcoin?
Bitcoin is part of a currency group that is referred to as a ‘cryptocurrency’. A cryptocurrency is a digital / virtual asset that is designed to operate as a medium of exchange. Bitcoin was created in 2008 by an unknown entity under the allis of ‘Satoshi Nakamoto’. The first ever Bitcoin was traded at the value of $0.0008 when an unknown user purchased a pizza for 10,000 Bitcoin! This was the first ever Bitcoin transaction and consequently lead to the birth of Bitcoin’s blockchain.
What is Bitcoin’s Blockchain?
The blockchain is the documentation of all transactions and coin ownership that is stored in Bitcoin’s decentralised ledger (a ledger is a collection of financial accounts). Bitcoin’s ledger exists in an online database that is stored on every device that engages in the Bitcoin network and is secured by advanced cryptography and coding. This is referred to as the ‘blockchain’. Whenever Bitcoin is purchased, sold or exchanged, every device engaging in the network records the transaction and the blockchain is then updated. Due to every device on the network holding a copy of the blockchain, it is impossible for Bitcoin’s blockchain to be hacked or deleted.
What makes Bitcoin different from other cryptocurrencies?
Cryptocurrencies have been around for a long time, with the first systems emerging in the 90’s, there have been several failed attempts at formulating the perfect coin! The first systems such as Flooz, Beenz, and DigiCash made their way to the market with a bang but couldn’t stick around for too long, falling at hurdles such as insufficient blockchains, fraud and more!
Unlike its predecessors, Bitcoin was the first ‘peer-to-peer’ electronic cash system. Due to the fact that Bitcoin could operate on a ‘peer to peer’ basis, it meant that unlike all currencies before it, both fiat and crypto, it was the first ever decentralised currency. Being a ‘peer to peer’ system meant that there was no requirement for an institutional body such as governments and banks to manage transactions, all exchanges would be documented and managed via the blockchain.
Bitcoin started out and still remains as an open-source, meaning that anyone can indulge in it, there are no restrictions or barriers to entry. Everything including transactions and balances are kept on its decentralised ledger and this accessible to view by anyone, making it entirely transparent. Banks store their ledgers in an internal database that is not available to the public, meaning their ledgers are non-transparent.
About Bitcoin Simplified
We are an emerging organisation, consisting of a team of investment analysts who specialise in the field of cryptocurrency, specifically, Bitcoin. With over 4 years’ worth of experience within the Bitcoin domain and a high frequency of requests from our social media platforms, we have decided to create a website to share our content.
Our mission is to provide all of our viewers with invaluable insights and knowledge as to how Bitcoin and other cryptocurrencies can change your life! We invest time, effort and passion into all of the work that we produce, in the hopes that we can inspire you to invest with confidence.
If you would like to find out more about or journey so far, then make sure you check out the other pages of our website along with our Instagram page @bitcoinsimplified. From all of us here at Bitcoin simplified, welcome to our website! We hope that you can grow with us on this journey, who knows where it could lead you!