Origin of bitcoin
Bitcoin is a peer-peer electronic cash system.
In november 2008 a letter was posted to the to a cryptography mailing list under the name Satoshi Nakamoto.In January 2009, the bitcoin network came into existence with the release of the first open source bitcoin client.irst supporters, adopters, contr.ibutor to bitcoin and receiver of the first bitcoin transaction was programmer Hal Finney. Finney downloaded the bitcoin software the day it was released, and received 10 bitcoins from Nakamoto in the world’s first bitcoin transaction.In February 2013 the bitcoin-based payment processor Coinbase reported selling US$1 million worth of bitcoins in a single month at over $22 per bitcoin.In January 2016, the network rate exceeded 1 exahash/sec.
In August 2016, a major bitcoin exchange, Bitfinex, was hacked and nearly 120,000 BTC (around $60m) was stolen.In September 2016, the number of bitcoin ATMs had doubled over the last 18 months and reached 771 ATMs worldwide.
Bitcoin generates more academic interest year after year; the number of Google Scholar articles published mentioning bitcoin grew from 83 in 2009, to 424 in 2012, and 3580 in 2016.
Mt. Gox, the Japan-based exchange that in 2013 handled 70% of all worldwide bitcoin traffic, declared bankruptcy in February 2014, with bitcoins worth about $390 million missing, for unclear reasons. The CEO was eventually arrested and charged with embezzlement.
A single institution, such as the government, does not control the Bitcoin network. The idea behind the technology has always been – and remains – one of decentralization – that is, remaining completely independent of a central authority, like a bank, a government, or a country
There’s a lot of benefit to Bitcoin, and a variety of reasons for its use, including:
- Faster Payment: Accepting wire transfers and checks is time consuming, and it can take several days for payment to clear. Bitcoin is faster and can take a matter of minutes, rather than days to process payment.
- Lower Transaction Fees: The cost to accept Bitcoins is lower compared to other payment methods, such as credit cards or Paypal.
- Independent of Governments: Since Bitcoin is decentralized, you own it – no authority has the right to take away your Bitcoin. People with concerns about mainstream banking systems unravelling find this a major benefit.
- Elimination of Chargebacks: Once Bitcoin is sent, that’s it – you can’t chargeback, like you would with a credit card payment, which eliminates ‘chargeback fraud’ often used by criminals and scammers.
- Protection Against Inflation: With a fiat currency, the government can print as much money as it desires – this drastically decreases the value of currency, and may result in inflation. In contrast, Bitcoin has a fixed number – after they have all been ‘mined’, no more Bitcoins will be created. Scarcity is an important aspect of currency which protects it from inflation.
- Ownership of Currency: With Bitcoin, you own your coins. With other forms of digital fiat – such as Paypal – your assets may be held, and your account eventually suspending, locking you out of your earnings. Bitcoin puts you in control.
One very important misconception commonly addressed about Bitcoin is that it is completely anonymous. Every single transaction around the globe is recorded on a public ledger
Bitcoin is also the name of the protocol (or a set of rules) on which the Bitcoin system is based. It consists of thousands of networked computers connected to the Internet and running the Bitcoin client. Each computer running the Bitcoin software is called a node and each node can communicate with the other nodes on the network making it a peer-to-peer system.
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