Understanding Bitcoin: fraud, or the future of money? 

Understanding Bitcoin: fraud, or the future of money? 

Context:

  • In 2009, the first block of that currency, known as Bitcoin, went online.
  • To this day, it has undergone a wide range of changes.

Change in opinion about Bitcoin:

  • Opinion on Bitcoin is divided on:
  • whether its value is a sign of a growing rebellion against a monetary system controlled by corrupt, predatory governments, or, alternately whether it is providing a haven for criminals.
  • There are also those who believe that Bitcoin and other digital currencies that have since emerged are simply a giant, collective delusion.

Changes in Bitcoin over eight years:

  • The principles underlying Bitcoin make it a democratic alternative to the commercial banking network, and even central banks.
  • Bitcoin appealed to a spectrum of libertarians and anarchists, whose value would be determined purely by demand and supply, not by the actions of central banks.
  • Bitcoin uses cryptography to securely conduct a transaction between a sender and a recipient.

What is Blockchain?

  • Each confirmed  transaction is recorded on a public ledger, called a blockchain.
  • The blockchain is shared between all users of the Bitcoin network, and updated in real time.
  • The underlying mathematics makes it impossible to make duplicate copies of Bitcoin, or use it for more than one transaction at a time.
  • Each time a new block or set of transactions is consolidated into a blok, it verifies all those before it. In general, six verifications mean a transaction is 99.99% likely to be genuine.

What is Bitcoin?

  • Bitcoin is a worldwide cryptocurrency and digital payment system called the first decentralized digital currency, as the system works without a central repository or single administrator.
  • It was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.  
  • The system is peer-to-peer, and transactions take place between users directly, without an intermediary.
  • These transactions are verified by network nodes and recorded in a public distributed ledger called a blockchain.
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