Bitcoin

What Is Bitcoin?


Bitcoin is a decentralized digital currency created in January 2009. It follows the ideas set out in a white paper by the mysterious and pseudonymous Satoshi Nakamoto. The identity of the person or persons who created the technology is still a mystery. Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms do, and unlike government-issued currencies, it is operated by a decentralized authority.


Bitcoin is known as a type of cryptocurrency because it uses cryptography to keep it secure. There are no physical bitcoins, only balances kept on a public ledger that everyone has transparent access to (although each record is encrypted). All Bitcoin transactions are verified by a massive amount of computing power via a process known as “mining.” Bitcoin is not issued or backed by any banks or governments, nor is an individual bitcoin valuable as a commodity. Despite it not being legal tender in most parts of the world, Bitcoin is very popular and has triggered the launch of hundreds of other cryptocurrencies, collectively referred to as altcoins. Bitcoin is commonly abbreviated as BTC when traded.

Understanding Bitcoin
The Bitcoin system is a collection of computers (also referred to as “nodes” or “miners”) that all run Bitcoin’s code and store its blockchain. Figuratively speaking, a blockchain can be thought of as a collection of blocks. In each block is a collection of transactions. Because all of the computers running the blockchain have the same list of blocks and transactions and can transparently see these new blocks as they’re filled with new Bitcoin transactions, no one can cheat the system.

Anyone whether they run a Bitcoin “node” or not can see these transactions occurring in real time. To achieve a nefarious act, a bad actor would need to operate 51% of the computing power that makes up Bitcoin. Bitcoin has around 13,768 full nodes, as of mid-November 2021, and this number is growing, making such an attack quite unlikely.

But if an attack were to happen, Bitcoin miners the people who take part in the Bitcoin network with their computers—would likely split off to a new blockchain, making the effort the bad actor put forth to achieve the attack a waste.

Balances of Bitcoin tokens are kept using public and private “keys,” which are long strings of numbers and letters linked through the mathematical encryption algorithm that creates them. The public key (comparable to a bank account number) serves as the address published to the world and to which others may send Bitcoin.

The private key (comparable to an ATM PIN) is meant to be a guarded secret and only used to authorize Bitcoin transmissions. Bitcoin keys should not be confused with a Bitcoin wallet, which is a physical or digital device that facilitates the trading of Bitcoin and allows users to track ownership of coins. The term “wallet” is a bit misleading because Bitcoin’s decentralized nature means it is never stored “in” a wallet, but rather distributed on a blockchain.

Peer-to-Peer Technology:
Bitcoin is one of the first digital currencies to use peer-to-peer (P2P) technology to facilitate instant payments. The independent individuals and companies who own the governing computing power and participate in the Bitcoin network Bitcoin “miners” are in charge of processing the transactions on the blockchain and 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 bitcoins are released to miners at a fixed but periodically declining rate. There are only 21 million bitcoins that can be mined in total. As of November 2021, there are over 18.875 million Bitcoin in existence and less than 2.125 million Bitcoin left to mine.

Bitcoin Mining:

Bitcoin mining is the process by which Bitcoin is released into circulation. Generally, mining requires solving computationally difficult puzzles to discover a new block, which is added to the blockchain.

Bitcoin mining adds and verifies transaction records across the network. Miners are rewarded with some Bitcoin; the reward is halved every 210,000 blocks. The block reward was 50 new bitcoins in 2009. On May 11, 2020, the third halving occurred, bringing the reward for each block discovery down to 6.25 bitcoins
Early Timeline of Bitcoin
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 to 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 white paper 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 to the Cryptography Mailing List.

Jan. 9, 2009
Block 1 is mined, and Bitcoin mining commences in earnest.

Bitcoin employment opportunities:
Those who are self-employed can get paid for a job related to Bitcoin. There are several ways to achieve this, such as creating any internet service and adding your Bitcoin wallet address to the site as a form of payment. There are also several websites and job boards that are dedicated to digital currencies:

Why Is Bitcoin Valuable?
Bitcoin’s price has risen exponentially in just over a decade, from less than $1 in 2011 to more than $68,000 as of November 2021. Its value is derived from several sources, including its relative scarcity, market demand, and marginal cost of production. Thus, even though it is intangible, Bitcoin commands a high valuation, with a total market cap of $1.11 trillion as of November 2021

Is Bitcoin a Scam?
Even though Bitcoin is virtual and can’t be touched, it is certainly real. Bitcoin has been around for more than a decade and the system has proved itself to be robust. The computer code that runs the system, moreover, is open source and can be downloaded and analyzed by anybody for bugs or evidence of nefarious intent. Of course, fraudsters may attempt to swindle people out of their Bitcoin or hack sites such as crypto exchanges, but these are flaws in human behavior or third-party applications and not in Bitcoin itself.

How Many Bitcoins Are There?
The maximum number of bitcoins that will ever be produced is 21 million, and the last bitcoin will be mined at some point around the year 2140. As of November 2021, more than 18.85 million (almost 90%) of those bitcoins have been mined.18 Moreover, researchers estimate that up to 20% of those bitcoins have been “lost” due to people forgetting their private key, dying without leaving any access instructions, or sending bitcoins to unusable addresses.

Where Can I Buy Bitcoin?
There are several online exchanges that allow you to purchase Bitcoin. In addition, Bitcoin ATMs internet-connected kiosks that can be used to buy bitcoins with credit cards or cash have been popping up around the world. Or, if you know a friend who owns some bitcoins, they may be willing to sell them to you directly without any exchange at all.

The end…

What is crypto currency ?

Cryptocurrency is the most trending topic nowadays and the industry is also booming very much in this digital era. You must have listened about this everyone has different opinion and conception about it, now the questions arise what is crypto and why it’s so trending cryptocurrency is a digital currency or virtual currency which doesn’t exist in physical form or hard cash and is typically not issued by a government or any central authority. It is based on a blockchain system that works as a public financial transaction database.

The first decentralised cryptocurrency was bitcoin
and it came into existence in 2009, when the bitcoin became popular than many other cryptocurrencies like ethereum, litecoin, stellar and the most heated dogecoin. since cryptocurrency came into existence it’s been facing legality issues and every country has its way of dealing with cryptocurrency. Many countries have allowed their use and trade without any legal issues and while other countries have banned or restricted this kind of activity. Cryptocurrencies face criticism for many reasons which include the usage of crypto in illegal activities like its the main source of money transfer in the dark web and other illegal hacking activities. They are also praised by many for their inflation resistance, transparency and it’s becoming a great mode of investment nowadays. People have not started using it as a currency but buying it for investment which has resulted in the inflation of bitcoin and other cryptocurrencies. The most popular cryptocurrency is bitcoin which was created in January 2009 it was the first cryptocurrency or the first decentralized currency.

Recently, El Salvador became the first country to accept bitcoin as everyday currency in June 2021. In El Salvador, you can buy anything with bitcoins just like normal hard cash. Many countries have banned this mode of transaction and many have restricted its use. Countries like Algeria, Bolivia, Egypt, Iraq, Morocco, Nepal, Pakistan, and the United Arab Emirates have already banned this mode of transaction completely and countries like Bahrain, Bangladesh, China, Colombia, the Dominican Republic, Indonesia, Iran, Kuwait, Lesotho, Lithuania, Macau, Oman, Qatar, Saudi Arabia and Taiwan have allowed this kind of activity with some restrictions on it.

India has not officially announced anything about its legality but till now it’s legal to trade in cryptocurrency, now and then rumours have been spread that India is going to ban it or not but any official authorisation has not given any statement about it. If you are an Indian citizen or living in India so it is completely legal to trade in it but there’s no regulation on crypto till now, which means you are free to invest or trade in cryptocurrency but it is not regulated by any government authority to protect your money.

What is crypto and blockchain?

What is crypto?

Currently every country has its own currency regulated by its topmost federal bank. They are bought and sold and exchanged in the international currency markets like stocks. Owing to the popularity of the US in the last century and the stability and predictability of its economy, the dollar  has become the most popular and trusted currency all over. Almost all countries keep large reserves of dollars and most international trade are carried out with it. It’s the literal meaning of a ‘global currency’. But any true global currency must be regulated by some institute that represents the world just like UNO. But, on the contrary, the ‘global currency’ dollar $ is regulated by US top banks and that can definitely lead to certain manipulative advantages for the US. To offset this some countries have started to keep a basket of currency reserves including the likes of Euro. If the popularity of the dollar falls in future for whatever reason, other currencies may try to fill up the vacuum created by it.

Now the emergence of the internet has generated a new breed of global currencies, cryptocurrencies, which are regulated not by any country but by some companies.

Say someone starts a company called ABC Pvt Ltd which develops a digital platform and floats a new digital cryptocurrency called abxCoin (C). He simply links the value of C1 to $1 and makes them equal and connects it (C1) to many other currencies via the international currency market. Now one can see that this digital platform is accessible across all countries on the internet. Suppose any company in the US can buy C10000 by depositing $10000 in the bank account linked to his company ABC Ltd.  Also another company in India can buy C10000 by depositing ₹70,0000 (1$ = ₹70). If these Indian and US companies want to transact some random business  like import or export, they can easily do it with abxCoins as a mutually agreed upon common currency. But here their trust in between those companies is essential. Because ripping off anyone in this is very easy if someone is fly by night. But serious entrepreneurs can grow their business well.

Thus we have Bitcoins, dogecoin, Ethereum, etc. with some variations. Of course cryptocurrencies need not be pegged to 1 dollar as it was done above for simplicity.

Blockchain

One more important feature of cryptocurrencies is the security that they provide from hacking. A technology called Blockchain technology is used in it where a new transaction is linked to the series of old transactions and hacking is not easy like some hacker can hack an isolated transaction. In fact federal banks all over the world are now looking at ways they can also adopt this Blockchain technology for extra safety for their own currencies.

Is crypto currency legal?

In India, RBI issued a circular in 2018 directing the banks, NBFCs, and other payment service providers to not provide any services to the Crypto Exchange and to not have any commercial relations with them.

However, in 2020 the Supreme court declared the circular issued by RBI before as unconstitutional and lifted the ban.

In January of 2021, Govt issued a statement that it will introduce a bill and a sovereign digital currency will be created and all the private currencies will be banned.

However, currently there is no law in India that puts a ban on these cryptocurrency or declares them illegal.