A beginner’s guide to Bitcoin
Bitcoin is a digital asset that operates in a decentralized manner, aiming to establish a new type of currency that is not controlled by centralized entities like governments or banks. Its creator, Satoshi, introduced both the bitcoin currency and the Bitcoin network. Bitcoin, denoted as BTC, is a cryptocurrency with a limited supply of 21 million coins, most of which have already been mined. Unlike physical assets like gold, bitcoin is difficult to seize and can be easily transferred. This is a result of the structure of the Bitcoin network, a peer-to-peer network of computers and individuals following the Bitcoin protocol. In conclusion, Bitcoin offers a system where ownership is transparent, and individuals have control over their funds.
Bitcoin, unlike traditional currencies that can be printed endlessly and lose value over time, has a stringent supply cap of 21 million. This fixed supply cannot be altered by any individual, institution, bank, or government. Through a secret phrase comprising 12-24 words, individuals can securely store their bitcoin on the blockchain, making it impervious to confiscation. In more developed regions, bitcoin is often viewed as an investment opportunity due to its scarcity and the basic economic principle of supply and demand. Consequently, many investors are channeling funds into bitcoin to capitalize on its anticipated appreciation and diversify their investment portfolios. Bitcoin's decentralized network facilitates swift and secure money transfers globally, requiring only the recipient's bitcoin address to send funds. This feature makes bitcoin particularly beneficial for expats and immigrants who rely on remittances.
Summary
Satoshi Nakamoto introduced Bitcoin in 2008 to address issues with traditional finance, launching it a year later. Bitcoin's development integrated software, hardware, cryptography, and mining, setting the foundation for decentralization. Originally designed as a peer-to-peer electronic cash system, Bitcoin has transformed into a store of value akin to "digital gold," supporting diverse applications like Bitcoin NFTs and the Bitcoin Name Service through network advancements.
