A bitcoin is a digital currency that was launched in January 2009, it has been set up with the ideas to set out in a white-paper by pseudonymous and mysterious Satoshi Nakamoto.
The person who created and launched bitcoin as a technology is still a mystery to everyone. No one knows to date who is Satoshi Nakamoto, although a lot of people and organizations have claimed the identity, none of them was successful to prove that.
Through media, it seems tempting to believe that the person who invented Bitcoin is one kind of genius who invented Bitcoin out of a thin air. There are few assumptions about Bitcoin’s inventor to keep the identity as a secret, number one can always be “Privacy” but others may include avoiding the unnecessary attention from media and government or due to the challenging scenario created for the traditional fiat currencies.
Bitcoin gathered a lot of attention due to its lower transaction fees when compared with traditional online payment set-ups. This is a cryptocurrency that is not issued by the government and operated through a decentralized authority. The fact is, bitcoin does not have any physical form, the balances are only available on the public ledger and have transparent visibility for everyone.
All the transactions that are done through bitcoin are verified with the help of massive computing power, neither it is supported by any government/ private banks nor does it hold the value as a commodity. Despite being an illegal entity, Bitcoin has attracted a huge number of investors and has set up the grounds for a hundred other cryptocurrencies which are collectively famous as altcoins in the market. Bitcoin is usually known by the acronym BTC.
For a better understanding of Bitcoin, it is important to know about block-chain. The bitcoin system runs on the collection of different computers which are also known as “miners” or “nodes”, they are responsible to run all the bitcoin codes and store their block-chain. In a layman’s language, a block-chain can be considered as a collection of blocks and each block holds the data of transactions, and one can easily see new blocks getting filled up with new bitcoin transactions.
The transparency in the process makes sure that no one can cheat the system, anyone can see the occurrence of these live transactions as it is not necessary to be a part of Bitcoin nodes. To commit any wicked act against the system, that individual needs to operate almost 51% of Bitcoin’s computing power. As of January 2021, it has been confirmed that Bitcoin has a total of 12,000 nodes and this quoted number is growing by each day which makes such attempts quite unlikely to happen.
Bitcoin is believed to be the first cryptocurrency that has utilized peer-to-peer technology to make smooth online and instant transactions. The independent companies or individuals who have invested in Bitcoin are allowed to participate in the network and they also own the governing computing powers to invest and play in the market. “Bitcoin miners” are responsible for processing the online transactions with the help of block-chain and presented by the rewards in form of release of new bitcoins, these transactions fees are all paid in form of Bitcoin.
The Bitcoin miners can also be thought of as a decentralized authority who implements the credibility of Bitcoin in the market, every time new bitcoins are released, they are assigned to the miners at a fixed periodically diminishing rate. In total only 21 million Bitcoins can be mined, as per January 2021 data, there are about 18,614,806 existing Bitcoins and 2,385,193 still left to be mined.
There are a lot of Bitcoin supporters present worldwide who believe that digital currency is the future of the finance sector. A lot of individuals suggest that it is a faster and low transaction fee facility that should be appreciated across the world. Inspite of so much popularity, no government and banking sector has backed and come up in the favour of cryptocurrency, they do not believe that Bitcoin can replace the traditional currencies. One of the reasons that cryptocurrency is supported by a lot of people is that it can be utilized as an alternative to traditional commodities and fiat currency of any country.
The fact remains unavoidable that Bitcoin was never designed as a regular equity investment which means no shares in the name of Bitcoins have been issued, still, a major portion of people have invested in Bitcoin as they saw it as a medium that would be used for future exchange purposes.
However, the uncertainty of its digital nature and lack of guarantee comes with several risks, a lot of risk alerts have been raised by the Financial Industry Regulatory Authority, Security and Exchange Commission, the Consumer Financial Protection Bureau and a lot of other organizations. With all the other cryptocurrencies being launched in the market, Bitcoin is still the king of the cryptocurrency market because of the goodwill and brand name established. People believe in Bitcoin and want to see it as the future of transaction exchange.