Bitcoin is solving big world problems in such a significant way. Right now, it’s the choice of currency to fund Ukraine. It’s lifting countries out of debt. It has also created millionaires out of people who took a chance on it years ago.
But, it still has most people confused. What exactly is it? Why do we need it? What does it do?
We thought we’d take a moment to slow down in our everyday pursuit of news and address these questions. Of course, we have this information in our ever-expanding Byte University, a list of publications that teach you everything from reporting crypto on your taxes to getting free Bitcoin. But, this brief will gleam over the topic to give you a basic understanding.
A Rundown Of Bitcoin
BTC was the first cryptocurrency ever created. It’s called peer-to-peer currency because the money can pass from hand to hand without a bank or any other facilitator. All you need is a digital wallet, and you can convert cash into Bitcoin and then use it to make purchases wherever Bitcoin is accepted.
At Bitcoin’s inception, the genius or geniuses who invented it put a cap on it at 21 million coins. You can purchase coins or parts of coins at their current value or mine for them, which means you can dedicate a computer to perform calculations. This system creates a network of computers performing computations about transactions and data mining—this very secure system, unregulated by one computer or a governing body.
Why Use Bitcoin
Bitcoin is outperforming the dollar bill and gold. In fact, Bitcoin has been called the new gold by several financial experts. There are ups and downs as Bitcoin’s value is calculated every second, but more ups than downs throughout its history. The primary way it benefits people is by providing a way for the unbanked to store currency. Unfortunately, some banks make it impossible for people in poverty to open an account. Then it’s a well-known fact that banks treat them differently by denying them services and charging them different rates.
All you need is the internet and a digital wallet to purchase Bitcoin. You can also accept payments in Bitcoin for services that you perform or merchandise that you sell. This ability alone has created a few millionaires who now own their businesses and are building a better life for themselves and their kids.
Interesting Bitcoin History
In 2009, Satoshi Nakamoto became famous for releasing this new digital currency. But no one knew who Nakamoto was, a person or a group of people. The year before, Nakamoto had published a white paper explaining Bitcoin, and the rest is history.
Two days after Bitcoin’s release, Nakamoto sent Hal Finney ten coins. Finney was a famous cryptographer who was the first to get into Bitcoin. That first transaction ever was simply a peer-to-peer transfer, a small exchange but very historical. Unfortunately, Hal Finney would soon be diagnosed with ALS and passed away five years later.
In 2010, two pizzas were purchased with Bitcoin, the first transaction of its kind. It cost Laszlo Hanyecz 10,000 BTC, which he had mined himself. That purchase would be worth a whopping $400 million today.
In 2013, a drunken online tirade would be credited for giving us one of the most popular terms in Bitcoin. A senior member on a Bitcoin forum who goes by the name of GameKyuubi was talking about holding because he’s a lousy trader. Unfortunately, he misspelled the word and created “Hodl,” which is what most people use to this day.
Last year, El Salvador made a considerable change in its economic structure. They adopted Bitcoin as legal tender, and the entire country began accepting it everywhere you could possibly go. Currently, they are building a city that is focused entirely on Bitcoin. Utilizing the power from a volcano, the country will benefit from Bitcoin mining while costs will be kept relatively low.
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