Bitcoin
|
---|
|
|
Plural
| bitcoins
|
---|
Symbol
| ? (Unicode:
U+20BF
₿
BITCOIN SIGN
(HTML
₿
))
[a]
|
---|
Precision
| 10
?8
|
---|
Subunits
| |
---|
1
⁄
1000
| millibitcoin
|
---|
1
⁄
1
000
000
| microbitcoin
|
---|
1
⁄
100
000
000
| satoshi
[2]
|
---|
|
Original author(s)
| Satoshi Nakamoto
|
---|
White paper
| "Bitcoin: A Peer-to-Peer Electronic Cash System"
[4]
|
---|
Implementation(s)
| Bitcoin Core
|
---|
Initial release
| 0.1.0 / 9 January 2009
(15 years ago)
(
2009-01-09
)
|
---|
Latest release
| 22.0 / 13 September 2021
(2 years ago)
(
2021-09-13
)
[3]
|
---|
Code repository
| github
.com
/bitcoin
/bitcoin
|
---|
Development status
| Active
|
---|
Website
| bitcoin
.org
|
---|
|
Ledger start
| 3 January 2009
(15 years ago)
(
2009-01-03
)
|
---|
Timestamping scheme
| Proof-of-work
(partial hash inversion)
|
---|
Hash function
| SHA-256
(two rounds)
|
---|
Issuance schedule
| Decentralized (block reward)
Initially ?50 per block, halved every 210,000 blocks
[8]
|
---|
Block reward
| ?6.25
[b]
|
---|
Block time
| 10 minutes
|
---|
Circulating supply
| ?18,830,000
[c]
[5]
|
---|
Supply limit
| ?21,000,000
[6]
[d]
|
---|
|
Market cap
| US$1.149 trillion
[e]
|
---|
- ↑
The symbol was encoded in
Unicode
version 10.0 at position
U+20BF
₿
BITCOIN SIGN
in the
Currency Symbols block
in June 2017.
[1]
- ↑
May 2020 to approximately 2024, halved approximately every four years
- ↑
Approximate supply as of 2021-09-30
- ↑
The supply will approach, but never reach, ?21 million. Issuance will permanently halt
c.
2140 at ?20,999,999.9769.
[7]
: ch. 8
- ↑
As of October 22, 2021
|
Bitcoin
[a]
(
?
) is a
digital
and global
money system
cryptocurrency
. It allows people to send or receive cryptocurrency units across the
internet
, even to someone they don't know or don't trust. It is the first of its kind technology that allows the
transfer
of digital
scarcity
across the internet without needing a third party. Cryptocurrency units can be exchanged without being linked to a real identity. The
mathematical
field of
cryptography
is the basis for Bitcoin's
security
.
Bitcoin was invented by someone using the name
Satoshi Nakamoto
.
[14]
A Bitcoin address, or simply address, is an identifier of 26-35 letters and numbers, beginning with the number 1, 3, or bc1, that represents a possible destination for a bitcoin payment. Addresses can be generated at no cost by any user of Bitcoin. For example, using Bitcoin
Core
, one can click "New Address" and be assigned an address. It is also possible to get a Bitcoin address using an account at an exchange or online wallet service.
The domain name "bitcoin.org" was registered on 18 August 2008.
[15]
On 31 October 2008, a link to a paper authored by
Satoshi Nakamoto
titled
Bitcoin: A
Peer-to-Peer
Electronic Cash System
[4]
was posted to a cryptography mailing list.
[16]
In June 2021,
El Salvador
became the first country in the world to make Bitcoin a
legal tender
.
[17]
In April 2022, the
Central African Republic
made bitcoin a legal tender.
[18]
One of the
differences
between using bitcoin and using regular money online is that bitcoin can be used without having an internet connection to link any sort of real-world identity to it. Unless someone chooses to link their name to a bitcoin address, it is hard to tell who owns the address. Bitcoin does not keep track of users; it keeps track of addresses where the money is. Each address has two important pieces of
cryptographic
information, or keys: a public one and a private one.
The public key, which is what the "bitcoin address" is created from, is similar to an email address; anyone can look it up and send bitcoins to it. The private address, or private key, is similar to an email
password
; only with it can the owner send bitcoins from it. Because of this, it is very important that this private key is kept
secret
. To send bitcoins from an address, you prove to the network that you own the private key that belongs to the address, without revealing the private
key
. This is done with a branch of mathematics known as
public-key cryptography
.
A public key is what determines the ownership of bitcoins, and is very similar to an
ID number
. If someone wanted to send you bitcoins, all you would need to do is supply them your bitcoin address, which is a version of your public key that is easier to read and type. For example, if Bob has 1 bitcoin at the bitcoin address "ABC123," and Alice has no bitcoins at the bitcoin address "DEF456," Bob can send 0.5 bitcoins to "DEF456." As soon as the transaction is processed, Alice and Bob both have 0.5 bitcoins. Anyone using the system can see how much money "ABC123" has and how much money "DEF456" has, but they cannot tell anything about who owns the address.
A Bitcoin private key has 52 characters consisting of letters and numbers. It is, simply, a random number. The set of numbers that can make up a private key is extremely large. The Bitcoin private key can be any number from a maximum of 2 to the power of 256.
[19]
In the example above, "ABC123" and "DEF456" are the bitcoin addresses of Bob and Alice. But Bob and Alice each have a second key which only they individually know. This is the private key, and it is the "other half" of a Bitcoin address. The private key is never shared, and allows the owner of the bitcoins to control them. However, if the private key is not kept secret, then anyone who sees it can also control and take the bitcoins there. This happened on live TV when
Bloomberg's
Matt Miller accidentally showed a private key to viewers.
[20]
The money was taken immediately. The person who took it, told others about it later, saying "I'll send it back once Matt gives me a new address, since someone else can sweep [empty] out the old one."
Sites or users using the Bitcoin system are required to use a global
database
called
blockchain
. Blockchain is a record of all transactions that have taken place in the Bitcoin network. It also keeps track of new bitcoins as they are generated. With these two facts, the blockchain can keep track of who has how much money at all times.
[
source?
]
The process of generating the bitcoins is called mining.
[19]
To generate a bitcoin, a miner must solve a math problem. However, the difficulty of the math problem depends on how many people are mining for bitcoin at the moment. Because of how complicated the math problems usually are, they must be calculated with very powerful
processors.
These processors can be found in CPUs, graphics cards, or specialized machines called ASICs. People who use these machines to mine bitcoins are called miners. Miners either compete with one another or work together in groups to solve a mathematical puzzle. The first miner or group of miners to solve the particular puzzle are rewarded with new bitcoins.
The puzzle is determined by the transactions being sent at the time and the previous puzzle solution. This means the solution to one puzzle is always different from the puzzles before. Attempting to change an earlier transaction, maybe to fake bitcoins being sent or change the number of someone's bitcoins, requires solving that puzzle again, which takes a lot of work, and also requires solving each of the following puzzles, which takes even more work. This means a bitcoin cheater needs to outpace all the other bitcoin miners to change the bitcoin history. This makes the bitcoin blockchain very safe to use.
When miners mine a block of bitcoin, they receive a reward. This reward gets cut in half every 210,000 blocks, which occurs roughly once every 4 years.
[21]
During Bitcoin's inception, the block reward was 50 BTC. It was halved to 25 BTC on November 28th, 2012, and to 12.5 BTC on July 9th, 2016. As of May 11th, 2020, the block reward has been 6.25 BTC.
[22]
A popular image associated with Bitcoin is a
QR code
. QR codes are a group of black and white boxes that are similar to barcodes. Barcodes are a row of lines, and QR codes are a grid of squares. Bitcoin uses QR codes because they can store more information in a small space, and a camera such as a
smartphone
can read them. The two QR codes on the Bitcoin note are the public and private addresses, and can be scanned with a number of online tools.
Everyone in the Bitcoin network is considered a peer, and all addresses are created equal. All transactions can take place solely from peer to peer, but a number of sites exist to make these transactions simpler. These sites are called exchanges. Exchanges provide tools for dealing in Bitcoin. Some allow the purchase of Bitcoin from external accounts, and others allow trading with other cryptography-based currencies like Bitcoin. Most exchanges also provide a basic "wallet" service.
Wallets provide a handy way to keep track of all of a user's public and private addresses. Because addresses are
pseudo
a
anonymous
, anyone can have as many addresses as they want.
[
source?
]
This is useful for dealing with multiple people, but it can get complicated to manage multiple accounts. A wallet holds all of this information in a convenient place, just like a real wallet would. A backup of a wallet prevents 'losing' the bitcoins.
During the
2010s
, Bitcoin has gained the attention of the mainstream media.
[23]
Adoption growth has not only happened for consumers,
[24]
but also for many companies, who are looking to make use of all of the advantages of Bitcoin.
As of 2018, Bitcoin was most popular cryptocurrency, followed by
Ethereum
and
Litecoin
.
[25]
As of
2021
,
El Salvador
is the first country in the world to adopt the Bitcoin as a
legal tender
.
[26]
Bitcoin has often been criticized for its unstable price, its network's high electricity consumption, and for its high transaction fees. Additionally, it has been criticized for having characteristics in common with
Ponzi
and
pyramid schemes
.
Bitcoin owners regularly complain about losing their password, making their bitcoins permanently inaccessible.
[27]
- ↑
"Unicode 10.0.0"
. Unicode Consortium. 20 June 2017.
Archived
from the original on 20 June 2017
. Retrieved
20 June
2017
.
- ↑
Mick, Jason (12 June 2011).
"Cracking the Bitcoin: Digging Into a $131M USD Virtual Currency"
. Daily Tech. Archived from
the original
on 20 January 2013
. Retrieved
30 September
2012
.
- ↑
"Bitcoin Core 22.0"
. Retrieved
14 September
2021
.
- ↑
4.0
4.1
4.2
Nakamoto, Satoshi (31 October 2008).
"Bitcoin: A Peer-to-Peer Electronic Cash System"
(PDF)
. bitcoin.org.
Archived
(PDF)
from the original on 20 March 2014
. Retrieved
28 April
2014
.
- ↑
"Bitcoin"
. 30 September 2021.
- ↑
Nakamoto; et al. (1 April 2016).
"Bitcoin source code - amount constraints"
.
GitHub
.
Archived
from the original on 1 July 2018.
- ↑
Antonopoulos, Andreas M.
(April 2014).
Mastering Bitcoin: Unlocking Digital Crypto-Currencies
. O'Reilly Media.
ISBN
978-1-4493-7404-4
.
- ↑
"Statement of Jennifer Shasky Calvery, Director Financial Crimes Enforcement Network United States Department of the Treasury Before the United States Senate Committee on Banking, Housing, and Urban Affairs Subcommittee on National Security and International Trade and Finance Subcommittee on Economic Policy"
(PDF)
.
fincen.gov
. Financial Crimes Enforcement Network. 19 November 2013.
Archived
(PDF)
from the original on 9 October 2016
. Retrieved
1 June
2014
.
- ↑
Vigna, Paul; Casey, Michael J. (January 2015).
The Age of Cryptocurrency: How Bitcoin and Digital Money Are Challenging the Global Economic Order
(1 ed.). New York: St. Martin's Press.
ISBN
978-1-250-06563-6
.
- ↑
10.0
10.1
"bitcoin"
.
OxfordDictionaries.com
. Archived from
the original
on 2 January 2015
. Retrieved
28 December
2014
.
;
- ↑
Bustillos, Maria (2 April 2013).
"The Bitcoin Boom"
.
The New Yorker
. Conde Nast.
Archived
from the original on 27 July 2014
. Retrieved
22 December
2013
.
Standards vary, but there seems to be a consensus forming around Bitcoin, capitalized, for the system, the software, and the network it runs on, and bitcoin, lowercase, for the currency itself.
- ↑
Vigna, Paul (3 March 2014).
"BitBeat: Is It Bitcoin, or bitcoin? The Orthography of the Cryptography"
.
WSJ
.
Archived
from the original on 19 April 2014
. Retrieved
21 April
2014
.
- ↑
Metcalf, Allan (14 April 2014).
"The latest style"
. Lingua Franca blog. The Chronicle of Higher Education (chronicle.com).
Archived
from the original on 16 April 2014
. Retrieved
19 April
2014
.
- ↑
S., L. (2 November 2015).
"Who is Satoshi Nakamoto?"
.
The Economist
. The Economist Newspaper Limited.
Archived
from the original on 21 August 2016
. Retrieved
23 September
2016
.
- ↑
Bernard, Zoe (2 December 2017).
"Everything you need to know about Bitcoin, its mysterious origins, and the many alleged identities of its creator"
.
Business Insider
.
Archived
from the original on 15 June 2018
. Retrieved
15 June
2018
.
- ↑
Finley, Klint (31 October 2018).
"After 10 Years, Bitcoin Has Changed Everything?And Nothing"
.
Wired
.
Archived
from the original on 5 November 2018
. Retrieved
9 November
2018
.
- ↑
Hart, Robert (9 June 2021).
"El Salvador Makes History As World's First Country To Make Bitcoin Legal Tender"
.
Forbes
. Retrieved
9 June
2021
.
- ↑
"Bitcoin becomes official currency in Central African Republic"
.
BBC News
. 27 April 2022
. Retrieved
27 April
2022
.
- ↑
19.0
19.1
"The great chain of being sure about things"
.
The Economist
. The Economist Newspaper Limited. 31 October 2015.
Archived
from the original on 3 July 2016
. Retrieved
20 October
2022
.
- ↑
Ro, Sam.
"A Bloomberg TV Host Gifted Bitcoin On Air And It Immediately Got Stolen"
.
Business Insider
. Retrieved
30 June
2020
.
- ↑
Frankenfield, James.
"What is a block reward?"
.
Investopedia.com
. Dotdash
. Retrieved
17 September
2021
.
- ↑
"Bitcoin Block Reward Halving Countdown"
.
bitcoinblockhalf.com
. Retrieved
17 September
2021
.
- ↑
"Google Trends"
.
Google Trends
.
- ↑
Sarah, Ruby (16 February 2021).
"Bitcoin's Adoption Increases at Unprecedented Levels"
.
ForexBrokers
.
- ↑
Mourdoukoutas, Panos.
"Bitcoin, Ethereum And Litecoin Are The Most Popular Cryptocurrency Investments Among Millennials"
.
Forbes
.
- ↑
Sunil, Jagtiani (9 June 2021).
"El Salvador President Says Nation Adopts Bitcoin as Legal Tender"
.
Bloomberg.com
.
- ↑
"Lost bitcoins usenet post"
.
groups.google.com
. 2023.
Wikimedia Commons has media related to
Bitcoin
.