Bitcoin is a cryptocurrency that was invented in 2008 by an anonymous person or group known as Satoshi Nakamoto. The currency began to be used in 2009 when its application was released as open source software.
By creating the first decentralized digital currency, without a central bank, that can be sent from one person to another through the Bitcoin network in a peer-to-peer manner without the need for a third party (intermediary such as banks), network transfers are verified using encryption and recorded in a distributed ledger called the block chain Bitcoin is created as a reward for a process known as mining.
It can be exchanged for other currencies, products and services, and research produced by Cambridge University estimates that in 2017, there are between 2.9 to 5.8 million users using a digital currency wallet, and most of them use bitcoin, and below we show everything you need to know about bitcoin and its mining
Here's everything you need to know about Bitcoin:
What is bitcoin?
In the most general sense, Bitcoin is software that constitutes a peer-to-peer decentralized payment system with no central authority, and although it is called a digital currency or cryptocurrency, at the moment, most investors don't really use it as a currency to pay for things, and instead, They use it as a speculative investment to buy in the hope of making a profit, but at the same time some countries and companies have begun to recognize it in buying and selling.
How does this coin work?
Bitcoin operates on a so-called blockchain, a software system often described as an immutable digital "ledger" that exists on thousands of computers, all over the world, and is maintained by a combination of ordinary people and the most sophisticated computer experts, known collectively as Miners.
How long does it take to mine Bitcoin right now?
At the current rate, it would take about 1,200 years to mine a single Bitcoin, and this gives you a sense of how complex Bitcoin mining is, and how much processing power it takes: These computerized mining rigs put out so much energy that they can heat your home.
Who manages bitcoin?
Bitcoin is decentralized, meaning that there is no single government, central party or responsible institution, and transaction blocks on the blockchain network are validated by computing “consensus”, which is a feature of the software Bitcoin was created by someone in 2009 Using the alias Satoshi Nakamoto, but it is not known who he was, and this person or group does not control Bitcoin today.
How much is bitcoin worth?
The price of bitcoin fluctuates based on buying and selling, just like stocks, but there is a lot of debate about what the price represents, in theory, the value of bitcoin should reflect investors' belief in bitcoin as a technology.
But in reality, investors often see Bitcoin as a commodity due to limited supply, and under the Satoshi scheme, the total supply of Bitcoin will eventually be set at 21 million coins.
Is there really a physical currency called Bitcoin?
No, you cannot touch bitcoin because it is basically a software, you may have seen pictures of gold coins with a “” on them. These are souvenirs that can't be converted into actual bitcoin, but they are better for illustrating news stories than streams of numbers and letters that look like an actual blockchain.
Does the free market determine the entire value?
For the most part, yes. There is a known and finite supply of bitcoin, so when demand rises, so does the price. Technical innovation also contributes to the value of Bitcoin. It was a novelty when it was first created in 2009, and the market has decided (for now) that it is an invention worth something.
How do you buy and sell it?
There are now a number of easy-to-use exchanges where you can buy bitcoin using money transferred from a bank account, and in some cases by charging a credit card. The most popular prevalent option is Coinbase, which now has more than 13 million customers.
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