When the richest person in the world (Elon Musk) gives his support to a virtual currency you know it's big business. Elon Musk thinks the virtual currency, Bitcoin, is a "good thing". Elon's comments resulted in the value of Bitcoin rising significantly.
The online payment service, PayPal announced in last year that it would be allowing its customers to buy and sell Bitcoin.
Lamborghini is the first car company that accepted the use of Bitcoins.
Do you know about "Bitcoin pizza Day "? Hanyecz is known as the first person to use Bitcoin to buy two pizzas for 10,000 BTC. May 22, 2010 This day is known as Bitcoin Pizza Day.
With all this news you're probably wondering - What is Bitcoin and who created it ?
Here's everything you need to know.
What is Bitcoin ?
Bitcoin, known as a cryptocurrency, a virtual currency or a digital currency. Bitcoin is a type of money that is completely virtual. Some people concede, Bitcoin as a digital gold and a good store of value.
It is like an online version of cash. You can use it to buy products and services. However, some companies are beginning to buy its growing influence. From a user perspective, Bitcoin is pretty much like cash for the Internet.
Bitcoin is a consensus network that enables a new payment system and a completely digital money. It is the first decentralized peer-to-peer payment network that is powered by its users with no central authority or middlemen. Bitcoin can also be seen as the most prominent triple entry bookkeeping system in existence.
Fiat currency has two unique characteristic that Bitcoin could not claim.
For ex,
First, all Indian currency is considered legal tender. There is nothing stopping anyone including your landlord, grocery store, utility companies from saying "we don't accept Bitcoins", but they all have to take cash(INR).
Secondly, there is no asset backing this up. Bitcoin only has value because people say it does, not unlike Fiat.
" Bitcoin is exciting because it shows how cheap Financial transaction can be. Bitcoin is better then currency in that you don't have to physically in the same place and of course for large transaction currency can get pretty inconvenient." - Bill Gates
Bitcoin can be bought and sold using Fiat currencies using Bitcoin Exchanges. Once bought the Bitcoins needs to be stored in a Bitcoin wallet. All the transactions that ever happened with Bitcoin are stored in one giant ledger called - the blockchain.
After knowing that what is Bitcoin, question arises who created it ? Let's move on that !
Who created Bitcoin?
Whenever, the identity of Bitcoin's inventor is probably as relevant today as the identity of the person who invented paper.
History of Cryptography & Bitcoin
Wei Dai – Japan -1998
Crypto currency – Inventor
"Idea of a new form of money that uses cryptography to control its creation and transactions, rather than a central authority."
Satoshi Nakamoto (unknown)
31st Oct, 2008 – Research Paper
2009 – bitcoin.org - Japan
Open Source Software Satoshi left the project in late 2010 community has since grown exponentially with many developers working on Bitcoin.
Hal Finey - First person to download the open source software received 10 bitcoins from Satoshi Nakamoto - First bitcoin transaction.
Bitcoin is the first implementation of a concept called "cryptocurrency", which was first described in 1998 by Wei Dai (Japan-1998) on the cypherpunks mailing list, suggesting the idea of a new form of money that uses cryptography to control its creation and transactions, rather than a central authority.
Satoshi's anonymity often raised unjustified concerns, many of which are linked to misunderstanding of the open-source nature of Bitcoin. The Bitcoin protocol and software are published openly and any developer around the world can review the code or make their own modified version of the Bitcoin software.
In Today, our present Fiat currency's creation and transactions is done by the central authority but in the case of bitcoin creation and transaction there is no central authority or middlemen. Just like current developers, Satoshi's influence was limited to the changes he made being adopted by others and therefore he did not control Bitcoin.
Who controls the Bitcoin network?
When it comes to know Bitcoin protocol and software are open source then who controls the bitcoin network .
Do you know the technology behind the email?
Nobody owns the Bitcoin network much like no one owns the technology behind email. Bitcoin is controlled by all Bitcoin users around the world.
While developers are improving the software, they can't force a change in the Bitcoin protocol because all users are free to choose what software and version they use. In order to stay compatible with each other, all users need to use software complying with the same rules. Bitcoin can only work correctly with a complete consensus among all users. Therefore, all users and developers have a strong incentive to protect this consensus.
“Bitcoin is rapidly becoming the global reserve cryptocurrency just like the dollar is to fiat currency.”
Reference : Bitcoin.org
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