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What is Bitcoin (BTC)

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Bitcoin is the first cryptocurrency in the world. In 2009, he was donated to the world by an unknown author named Satoshi Nakamoto. Who it was and whether it was one person or a team is not yet known. Bitcoin is a digital form of money and sometimes also called digital gold, because of its deflationary nature (coins have a limited amount and increase value over time) and other properties, such as mining.

Bitcoin

Bitcoin (BTC)

Its author is unknown, its code is open-source. His journey is stormy. Repeatedly creates peaks and bottoms. It is highly volatile, but is less risky than other cryptocurrencies. It rules other cryptocurrencies called altcoins (the collective name for alternative coins and tokens). When the price of Bitcoin falls, altcoins fall even more, and vice versa. It has proven its potential in the long term and is already foreseen by institutional investors, governments and banks.

  • Investing in Bitcoin is risky, you need to be very careful about various scams and hacks and follow security rules.
  • Its technology is a decentralized chain of transaction blocks – blockchain.
  • The blockchain contains public data on all transactions, but not on owners who have btc in their wallets
  • New coins are created on special hardware (formerly on personal computers) by so-called mining.
  • Its price is affected by supply and demand on cryptocurrency exchanges
  • When the network splits, a new cryptocurrency, the so-called fork, may arise (for example, BCH or LTC).
  • Bitcoin as a model is behind the formation of thousands of other cryptocurrencies.
  • First transaction (2010) – 10,000 BTC for 2 pizzas.
    According to critics, he is said to have died about 350 times.

Satoshi

Bitcoin coins are divisible up to 1 satoshi = 0.00000001 ฿. The smallest unit is named after Satoshi Nakamoto, the name (rather a nickname) of the unknown inventor of Bitcoin. Satoshi has been completely silent over time, and the others developers are now working to improve Bitcoin. Bitcoin is used for domestic and international payments without an intermediary (banks, etc.). Everything works thanks to a decentralized network of miners who perform certain tasks on their mining machines, thus approving transactions and grouping them into newly mined blocks. Individual blocks are locked into a block chain – blockchain.

Number of coins

The final amount of btc coins is limited to 21 million by Satoshi alone for the whole world. He achieved this by regularly halving the rewards for miners – the so-called halving. Halving occurs once every 4 years. According to estimates, the next one will occur on 14 May 2020. It is the limited quantity that should cause the price to rise in the future as well.

Be your own bank

Bitcoin is amazing in several ways. It puts money and wealth back into people’s hands. Everyone who owns a private key to their wallet owns a BTC. And with all the risks and benefits that flow from it. In the future, Bitcoin offers itself as a single global currency that could very usefully supplement (or replace) the debt and inflation-laden fiat currency. In addition, it facilitates, simplifies and speeds up international transactions and can serve as a rescue in the event of hyperinflation (which has been confirmed in practice, for example, in Venezuela).

Thanks to a strong global network, Bitcoin is relatively resistant to government or bank intervention and efforts to ban it. For the same reasons, it is practically impossible to falsify or hack. All this elevates him to global currency, fulfilling certain currency functions and eliminating the need for banks and exchange offices. With rising prices, volatility (exchange rate volatility) will decrease and its price should become more and more stable, which will only increase its usefulness.

Bitcoin – Peaks and falls

Bitcoin is highly volatile. It is subject to cycles like the rest of the economy, but rapidly. It can be predicted that the pace of creation of individual peaks (ATH – all time high) and falls will gradually decrease with the growth of its price and the number of users. The last peak was in December 2017, at approximately $ 20,000. The ensuing fall brought the price down to $ 3,200 in December 2018.

There is a lot of speculation about the next peak. Some say there will be none. Bitcoin also has its critics, who claim that it has no value. Others see value in it, up to $ 1 million.

Helpful links

Official Bitcoin website – HERE

Current course (not only BTC) and other useful links to Coinmarketcap – HERE

Current transaction fees (will help to correctly set the amount of the fee for sending a payment) – HERE

Bitcoin is one of the greatest economic breakthroughs in modern history, returning money to the people because no state can control it.

 

All content in this article is for informational purposes only and in no way serves as investment advice. Investing in cryptocurrencies, commodities and stocks is very risky and can lead to capital losses.

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