What is Bitcoin?
How Bitcoin Works
Bitcoin is one of the first digital currencies to use peer-to-peer technology to facilitate instant payments. The independent individuals and companies who own the governing computing power and participate in the Bitcoin network, are comprised of nodes or miners. "Miners," or the people who process the transactions on the blockchain, are motivated by rewards (the release of new bitcoin) and transaction fees paid in bitcoin. These miners can be thought of as the decentralized authority enforcing the credibility of the Bitcoin network. New bitcoin is being released to the miners at a fixed, but periodically declining rate, such that the total supply of bitcoins approaches 21 million. As of July 2020, there are roughly 3 million bitcoins which have yet to be mined.1 In this way, Bitcoin (and any cryptocurrency generated through a similar process) operates differently from fiat currency; in centralized banking systems, currency is released at a rate matching the growth in goods in an attempt to maintain price stability, while a decentralized system like Bitcoin sets the release rate ahead of time and according to an algorithm.
Bitcoin mining is the process by which bitcoins are released into circulation. Generally, mining requires the solving of computationally difficult puzzles in order to discover a new block, which is added to the blockchain. In contributing to the blockchain, mining adds and verifies transaction records across the network. For adding blocks to the blockchain, miners receive a reward in the form of a few bitcoins; the reward is halved every 210,000 blocks. The block reward was 50 new bitcoins in 2009 and is currently 12.5. By around May 11th, 2020 the next halving will occur, bringing the reward for each block discovery down to 6.25 bitcoins. A variety of hardware can be used to mine bitcoin but some yield higher rewards than others. Certain computer chips called Application-Specific Integrated Circuits (ASIC) and more advanced processing units like Graphic Processing Units (GPUs) can achieve more rewards. These elaborate mining processors are known as "mining rigs."
One bitcoin is divisible to eight decimal places (100 millionths of one bitcoin), and this smallest unit is referred to as a Satoshi. If necessary, and if the participating miners accept the change, Bitcoin could eventually be made divisible to even more decimal places.
How Bitcoin Began
Aug. 18, 2008: The domain name bitcoin.org is registered. Today, at least, this domain is "WhoisGuard Protected," meaning the identity of the person who registered it is not public information.
Oct. 31, 2008: A person or group using the name Satoshi Nakamoto makes an announcement on The Cryptography Mailing list at metzdowd.com: "I've been working on a new electronic cash system that's fully peer-to-peer, with no trusted third party. This now-famous whitepaper published on bitcoin.org, entitled "Bitcoin: A Peer-to-Peer Electronic Cash System," would become the Magna Carta for how Bitcoin operates today.
Jan. 3, 2009: The first Bitcoin block is mined, Block 0. This is also known as the "genesis block" and contains the text: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks," perhaps as proof that the block was mined on or after that date, and perhaps also as relevant political commentary.
Jan. 8, 2009: The first version of the Bitcoin software is announced on The Cryptography Mailing list.
Jan. 9, 2009: Block 1 is mined, and Bitcoin mining commences in earnest.
In what ways is bitcoin similar to a Ponzi scheme? In what ways is bitcoin different?
Bitcoin… Is it a bird? Is it a plane? No, it’s a …. According to the Collins dictionary, Bitcoin is “a system of open source peer-to-peersoftware for the creation and exchange of (payment in) a certain type of cryptocurrency” Transactions of bitcoin are verified and recorded in public distributed ledger called blockchain. Bitcoin is going through an identity crisis! The SEC treats Bitcoin as a security or money. FinCEN treats Bitcoin as currency. The IRS treats Bitcoin as property. The...
What is Bitcoin and how does cryptocurrencies (bitcoin) work? Do you think this is an alternative for Currency in circulation?
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Please answer each with 4-5 sentences. Q8a. What is BitCoin? Who created BitCoin? Q8b. How do acquire BitCoin? Q8c. Can you use BitCoin to buy things? Q8d. Can BitCoin be taxed? Q8e. During the last year, BitCoin’s value went from $5000 to $20,000 in days and back down to $1200. Why is it so volatile? Q8f. Are there any other cybercurrencies? If yes, name them. Q9. Read up on blockchain. https://blockgeeks.com/guides/what-is-blockchain-technology/ There are other websites and videos explaining blockchain. Q9a....
What is BITCOIN? Is it the same as Cryptocurrency?
What is BITCOIN? Is it the same as Cryptocurrency?
Bitcoin and other cryptocurrencies have recently gained increasing prominence and popularity in the United States and across the globe. Do you think bitcoin currently works well as a currency? Why or why not? Does bitcoin satisfy the textbook requirements to be considered "money?" Do you own any bitcoin? Are you using or have you used bitcoin to make purchases? Finally, do you think bitcoin will increase in popularity and use in the future?