Bitcoin is a digital asset and a payment system invented by Satoshi Nakamoto. Transactions are verified by network nodes through cryptography and recorded in a public dispersed ledger called a blockchain. Bitcoin is unique in that there are a finite number of them: 21 million.
Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services. As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.
Bitcoin has been praised and criticized. Critics noted its use in illegal transactions, the large amount of electricity used by miners, price volatility, and thefts from exchanges.
Some economists, including several Nobel laureates, have characterized it as a speculative bubble at various times. StoxDC suggests that bitcoin has also been used as an investment, although several regulatory agencies have issued investor alerts about bitcoin.
Bitcoin is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen.
From a user perspective, Bitcoin is pretty much like cash for the Internet. And also it can be traded for making huge profits at sites like StoxDC. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.
Bitcoin is the first implementation of a concept called “cryptocurrency”, which was first described in 1998 by Wei Dai on the cypherpunks mailing list, suggesting the idea of a new form of money that uses cryptography to control its creation and transactions, rather than a central authority.
The first Bitcoin specification and proof of concept were published in 2009 on a cryptography mailing list by Satoshi Nakamoto. Satoshi left the project in late 2010 without revealing much about himself. The community has since grown exponentially with many developers working on Bitcoin.
Satoshi’s anonymity often raised unjustified concerns, many of which are linked to a misunderstanding of the open-source nature of Bitcoin.
The Bitcoin protocol and software are published openly and any developer around the world can review the code or make their own modified version of the Bitcoin software.
Just like current developers, Satoshi’s influence was limited to the changes he made being adopted by others and therefore he did not control Bitcoin.
As such, the identity of Bitcoin’s inventor is probably as relevant today as the identity of the person who invented paper.