What is Bitcoin and How it Works

What+is+Bitcoin+and+How+it+Works

Photo Courtesy of upr.org

Bitcoin, a worldwide cryptocurrency payment system created by Satoshi Nakamoto is surging in success and in stock as more people learn about the currency and invest in it. The cryptocurrency recently pulled up to 15,800 USD per Bitcoin, according to Bitcoin.org.

Bitcoin was created on August 1, 2009 by an anonymous person or group of people using the alias Satoshi Nakamoto. Originally, 1 Bitcoin valued at 0.39 USD in 2009-2010. Today, 1 Bitcoin values at 15,800 USD and is now the world’s most popular cryptocurrency, according to Metro.

Setting up a Bitcoin account/address can take seconds, with no questions asked and no fees payable. Meanwhile conventional banks make you jump through hoops simply to open up a bank account. Users can hold multiple bitcoin addresses, and none of them are linked to any names, addresses, or any other personal information. Bitcoin stores details of every single transaction that ever happened in the network in a huge version of general ledger, called blockchain, according to coindesk.

In order to make transactions with your Bitcoin address, you must first get a Bitcoin Wallet. There are four types of Bitcoin Wallets-Online Bitcoin Wallets, Software Wallets, Bitcoin Hardware Wallets, and paper wallets. A Bitcoin Wallet is software that enables users to receive, store, and send Bitcoins by empowering users to create and manage a collection of Private Keys. Private Keys are numbers that a user keeps discreet using a Bitcoin Wallet that enables them to transact Bitcoins by completing a math problem that the Bitcoin Network can validate, according to weusecoins.com.

Bitcoin is in fact interilly legal, but in 2013, the FBI shuttered Bitcoin. In 2013, Bitcoin was the sole currency accepted on Silk Road and the Dark Web used to buy drugs and other illicit goods. Since then, Bitcoin has largely evaded regulation and law enforcement in the U.S., although Bitcoin is under increased scrutiny as it attracts more mainstream attention, according to cnet.com.