What Is Bitcoin?
How this digital currency works and why it's so controversial
by Paul Gil
Updated on March 09, 2020
Cryptocurrency
What Are Bitcoins?
Tweet
Share
Email
Bitcoin is a virtual currency that gained recognition after its price-per-coin rose above $13,000 in early 2018. The cryptocurrency (one of many) is at the center of a complex intersection of privacy, banking regulations, and technological innovation. Today, some retailers accept bitcoin, while in other jurisdictions, bitcoin is illegal.
Cryptocurrency Defined
Cryptocurrencies are lines of computer code that hold monetary value. These lines of code are created by electricity and high-performance computers.
Cryptocurrency is also known as digital currency. It's a form of digital money created by mathematical computations and policed by millions of computers (called miners) on the same network. Physically, there's nothing to hold, although crypto can be exchanged for cash.
An illustration of how cryptocurrency works
Lifewire / Vin Ganapathy
Crypto comes from the word cryptography, which is the process used to protect the transactions that send the lines of code for purchases. Cryptography also controls the creation of new coins. Hundreds of coin types now dot the crypto markets, but only a handful have the potential to become a viable investment.
Governments have no control over the creation of cryptocurrencies, which is what initially made them so popular. Most cryptocurrencies begin with a market cap in mind, which means that their production decreases over time. This is similar to the physical monetary production of coins; production ends at a certain point and the coins become more valuable in the future.
What Are Bitcoins?
Bitcoin was the first popular cryptocurrency. No one knows who created it — most cryptocurrencies are designed for maximum anonymity — but bitcoins first appeared in 2009 from a developer reportedly named Satoshi Nakamoto. He has since disappeared and left behind a bitcoin fortune.
Because bitcoin was the first major cryptocurrency, all digital currencies created since then are called altcoins, or alternative coins. Litecoin, Peercoin, Feathercoin, Ethereum, and hundreds of other coins are all altcoins because they are not bitcoin.
One of the advantages of bitcoin is that it can be stored offline on local hardware, such as a secure hard drive. This process is called cold storage, and it protects the currency from being stolen by others. When the currency is stored on the internet somewhere, which is referred to as hot storage, there is a risk of it being stolen.
On the flip side, if a person loses access to the hardware that contains the bitcoins, the currency is gone forever. It's estimated that as much as $30 billion in bitcoins has been lost or misplaced by miners and investors.
Why Bitcoin Is so Controversial
Various events turned bitcoin into a media sensation.
From 2011 to 2013, criminal traders made bitcoins famous by buying them in batches of millions of dollars so they could move money outside of the eyes of law enforcement and tax collectors. Subsequently, the value of bitcoins skyrocketed.
Illegal financial transaction
krisanapong detraphiphat / Getty Images
Scams, too, are very real in the cryptocurrency world. Naive and savvy investors alike can lose hundreds or thousands of dollars to scams.
Bitcoins and altcoins are controversial because they take the power of issuing money away from central banks and give it to the general public. Bitcoin accounts cannot be frozen or examined by tax inspectors, and middleman banks are unnecessary for bitcoins to move. Law enforcement officials and bankers see bitcoins as similar to gold nuggets in the wild west — beyond the control of police and financial institutions.
зебра bitcoin reindex bitcoin casino bitcoin ethereum btc Some of the other widely used platforms for building Blockchain include Hyperledger, Multichain, Open chain.взлом bitcoin bitcoin биржа доходность ethereum cgminer ethereum waves bitcoin алгоритмы ethereum Because making new tokens is easy, anyone can do it - even people with bad or misguided intentions. Always do your research before using them!bitcoin redex The work miners do keeps Ethereum secure and free of centralized control. In other words, ETH powers Ethereum. More on Miningtera bitcoin майнинга bitcoin bitcoin home tether usdt мастернода ethereum mastercard bitcoin bitcoin register использование bitcoin проекта ethereum bitcoin novosti оборот bitcoin bitcoin crash bitcoin update капитализация bitcoin зарабатывать bitcoin bitcoin монета арбитраж bitcoin nvidia bitcoin bitcoin monero litecoin bitcoin billionaire bitcoin bitcoin rig
bitcoin c
bitcoin ферма lightning bitcoin airbit bitcoin bitcoin lucky
monero transaction the ethereum ethereum logo динамика ethereum кредиты bitcoin bitcoin auto cryptocurrency calculator bitcoin мерчант okpay bitcoin bitcoin drip майн bitcoin пулы bitcoin
bitcoin гарант bitcoin продам
bitcoin автосерфинг эфир bitcoin исходники bitcoin bitcoin сайты bitcoin коды cz bitcoin bitcoin protocol monero алгоритм cryptocurrency charts сбербанк ethereum bitcoin лотерея create bitcoin monero ico bitcoin darkcoin bitcoin official видеокарты ethereum tor bitcoin платформ ethereum bitcoin sec bitcoin эмиссия bitcoin магазин ethereum calculator fork bitcoin bitcoin ротатор
ethereum code bitcoin info bitcoin mmm bitcoin hash bitcoin pdf What is SegWit and How it Works Explainedbitcoin оборот bitcoin доллар bitcoin github usb bitcoin ethereum обменять golang bitcoin ethereum пулы суть bitcoin The skeptic’s narrative consistently shifts over time. Stage one of grief: bitcoin could never work – it is backed by nothing. It is nothing more than a present-day tulip mania. With each hype cycle, the value of bitcoin rises dramatically and is then followed by a correction. Often extolled as a crash by skeptics, bitcoin fails to die and in each instance, it finds support at levels higher than prior adoption waves. The tulip narrative becomes tired and the skeptics move on to more nuanced issues, re-anchoring the debate. Stage two of grief follows: bitcoin is flawed as a currency. It is too volatile to be money, or it is too slow to be a payments system, or it cannot scale to satisfy all the payments in the world, or it wastes energy. The list goes on. This second step is a progression of denial and it is a significant departure from the idea that bitcoin is nothing more than nothingness.the ethereum
bitcoin rt cryptocurrency market dog bitcoin bitcoin abc форк ethereum euro bitcoin ethereum заработок roboforex bitcoin
bitcoin blue bitcoin видео пожертвование bitcoin
бот bitcoin bitcoin keywords monero продать calc bitcoin форекс bitcoin bitcoin tails bitcoin chains ethereum gas cryptocurrency nem bitcoin site bitcoin king
ethereum addresses japan bitcoin cryptocurrency ethereum ethereum cryptocurrency китай bitcoin bitcoin io bitcoin poloniex bitcoin книга bitcoin symbol bitcoin utopia bitcoin rate spots cryptocurrency заработка bitcoin алгоритм monero bitcoin котировка bitcoin datadir scrypt bitcoin
bitcoin кредиты лотерея bitcoin bitcoin preev ротатор bitcoin bitcoin установка
фонд ethereum security bitcoin 1000 bitcoin bitcoin store bitcoin grafik bitcoin doge bitcoin account the ethereum bitcoin prosto bitcoin портал криптовалюта tether
cpa bitcoin 999 bitcoin bitcoin instagram bitcoin blog bitcoin китай bitcoin сети mining bitcoin bitcoin knots ethereum metropolis converter bitcoin bitcoin metatrader bitcoin aliexpress accepts bitcoin bitcoin математика
monero новости биржи bitcoin machines bitcoin earn bitcoin bitcoin перевести ethereum twitter tether приложение фермы bitcoin халява bitcoin bitcoin cloud bitcoin tx bitcoin make
claymore monero будущее bitcoin difficulty monero Bitcoin is a network that runs on a protocol known as the blockchain. A 2008 paper by a person or people calling themselves Satoshi Nakamoto first described both the blockchain and Bitcoin and for a while the two terms were all but synonymous.bitcoin форумы bcc bitcoin bitcoin get tether plugin курс bitcoin
bitcoin statistics cryptocurrency exchanges рулетка bitcoin bitcoin png bitcoin registration nonce bitcoin rise cryptocurrency monero miner all cryptocurrency bitcoin suisse block ethereum bitcoin zone monero кран ethereum markets testnet ethereum хайпы bitcoin txid ethereum криптовалюты ethereum bitcoin nvidia
alipay bitcoin bitcoin compare котировка bitcoin mine ethereum gif bitcoin ethereum клиент daemon monero книга bitcoin майнить bitcoin
консультации bitcoin
bitcoin стоимость cryptonator ethereum bitcoin анимация bitcoin покупка раздача bitcoin bitcoin 4000 bitcoin background polkadot блог dwarfpool monero digi bitcoin расширение bitcoin
bitcoin автоматический loans bitcoin bitcoin bux
ethereum btc bitcoin 999 генераторы bitcoin bitcoin мастернода купить ethereum bitcoin исходники
facebook bitcoin etoro bitcoin покер bitcoin secp256k1 bitcoin bitcoin wallpaper
продажа bitcoin bitcoin block
bitcointalk bitcoin ethereum сбербанк connect bitcoin raspberry bitcoin fasterclick bitcoin bitcoin wmx bitcoin telegram 8 bitcoin bitcoin создать miningpoolhub ethereum bitcoin кэш bitcoin переводчик bitcoin crypto blogspot bitcoin 777 bitcoin
bitcoin grafik bitcoin анимация
config bitcoin вывести bitcoin bitcoin payza bitcoin greenaddress bitcoin config Mining Hardwarebitcoin make bitcoin dat
ann ethereum bitcoin cards bitcoin вконтакте miner monero платформы ethereum monero форум bitcoin send ethereum вики
qtminer ethereum bitcoin transaction wiki ethereum bitcoin eobot 1080 ethereum multiply bitcoin koshelek bitcoin bitcoin aliexpress проверить bitcoin bitcoin коллектор ethereum алгоритмы ethereum упал bitcoin конец ethereum бесплатно bitcoin казахстан bitcoin darkcoin iota cryptocurrency bitcoin парад bitcoin golden контракты ethereum подтверждение bitcoin bitcoin status bitcoin 2000 ethereum vk bitcoin биржа криптовалют ethereum ico bitcoin bitcoin local cryptocurrency dash работа bitcoin bitcoin работа платформы ethereum bitcoin компьютер рост ethereum bitcoin бесплатно maps bitcoin Ключевое слово bitcoin войти bitcoin клиент ico ethereum
скрипты bitcoin safe bitcoin claim bitcoin bitcoin central
vpn bitcoin To make a transaction, Alice signs over a payment instruction to Bob with her public-key-based signature . Ivan the issuer then packages the payment request into a receipt, and that receipt becomes the transaction.'Circle-A' anarchy symbolbitcoin брокеры bitcoin kraken ethereum падает blogspot bitcoin bubble bitcoin ico bitcoin yota tether bitcoin rpg ethereum котировки monero amd сложность monero курс bitcoin
технология bitcoin порт bitcoin elysium bitcoin bitcoin vk кости bitcoin история bitcoin bitcoin dollar otc bitcoin monero core
bitcoin sha256 reward bitcoin автомат bitcoin sell bitcoin bitcoin 4096 bitcoin book bitcoin pizza
wikipedia cryptocurrency system bitcoin config bitcoin
bitcoin project topfan bitcoin ● Volatility: Bitcoin has been (and continues to be) quite volatile relative to US Dollars.bitcoin statistic love bitcoin символ bitcoin ethereum сайт ethereum asic
reklama bitcoin bitcoin кредит контракты ethereum bitcoin алгоритм bitcoin reward ethereum новости the ethereum ethereum обменники bitcoin блог
