Bitcoin is one of the first digital currencies to use peer-to-peer technology to facilitate instant payments. The independent individuals and companies who own the governing computing power and participate in the Bitcoin network, also known as "miners," 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 bitcoin is being released to the miners at a fixed, but periodically declining rate, such that the total supply of bitcoins approaches 21 million. One bitcoin is divisible to eight decimal places (100 millionth of one bitcoin), and this smallest unit is referred to as a Satoshi. If necessary, and if the participating miners accept the change, Bitcoin could eventually be made divisible to even more decimal places.
Satoshi Nakamoto is credited with designing Bitcoin. Nakamoto claims to be a man living in Japan born on April 5th, 1975 but there are speculations that he is actually either an individual programmer or group of programmers with a penchant for computer science and cryptography scattered around the United States or Europe. Nakamoto is believed to have created the first blockchain database and have been the first to solve the double spending problem other digital currency failed to. While Bitcoin’s creator is shrouded in mystery, his Wizard of Oz status hasn’t stopped the digital currency from becoming increasingly popular with individuals, businesses, and even governments.
Bitcoin is an increasingly popular cryptocurrency that utilizes blockchain technology to facilitate transactions. Basically, a user obtains a Bitcoin wallet that can be used for storing bitcoins and both sending and receiving of payments. The blockchain technology used by Bitcoin is really just a shared public ledger that is used by the entire public network. The technology used is secured through cryptography, a branch of mathematics that provides a highly secure means of facilitating and recording transactions on the network.
Bitcoin is the first cryptocurrency, a concept that was discussed in the late 90s. The first Bitcoin specification and proof of concept was published in 2009 in a cryptography mailing list. The concept was presented by a person or group known as Satoshi Nakamoto. The real identity of Nakamoto has been a mystery since that time, with various theories on who the individual or group may be.
Bitcoin is the first cryptocurrency, a concept that was discussed in the late 90s. The first Bitcoin specification and proof of concept was published in 2009 in a cryptography mailing list. The concept was presented by a person or group known as Satoshi Nakamoto. The real identity of Nakamoto has been a mystery since that time, with various theories on who the individual or group may be.
In late August 2012, an operation titled Bitcoin Savings and Trust was shut down by the owner, leaving around US$5.6 million in bitcoin-based debts; this led to allegations that the operation was a Ponzi scheme.[197][198][199][200] In September 2012, the U.S. Securities and Exchange Commission had reportedly started an investigation on the case.[201]
As the market valuation of the total stock of bitcoins approached US$1 billion, some commentators called bitcoin prices a bubble.[145][146][147] In early April 2013, the price per bitcoin dropped from $266 to around $50 and then rose to around $100. Over two weeks starting late June 2013 the price dropped steadily to $70. The price began to recover, peaking once again on 1 October at $140. On 2 October, The Silk Road was seized by the FBI. This seizure caused a flash crash to $110. The price quickly rebounded, returning to $200 several weeks later.[148] The latest run went from $200 on 3 November to $900 on 18 November.[149] Bitcoin passed US$1,000 on 28 November 2013 at Mt. Gox.
If you have the required hardware, you can mine bitcoin even if you are not a miner. There are different ways one can mine bitcoin such as cloud mining, mining pool, etc. For cloud mining, all you need to do is to connect to the datacenter and start mining. The good thing about this is that you can mine from anywhere and you don’t need a physical hardware to mine.
^ Jump up to: a b c d Joshua A. Kroll; Ian C. Davey; Edward W. Felten (11–12 June 2013). "The Economics of Bitcoin Mining, or Bitcoin in the Presence of Adversaries" (PDF). The Twelfth Workshop on the Economics of Information Security (WEIS 2013). Archived (PDF) from the original on 9 May 2016. Retrieved 26 April 2016. A transaction fee is like a tip or gratuity left for the miner.
More recently, at a congressional hearing on Capitol Hill, global economist and New York University professor Nouriel Roubini said, "Crypto is the mother or father of all scams and bubbles." He called out "swindlers" who tapped into investors' fear of missing out and took them for a ride with "crappy assets that went into a bust and crash — in a matter of months — like you have not seen in any history of financial bubbles."
17-20 November 2017 $7,600-8,100 Briefly topped at USD $8004.59/BTC at 01:14:11 UTC before retreating from highs. At 05:35 UTC on 20 November 2017 it stood at USD$7,988.23/BTC according to CoinDesk.[165] This surge in bitcoin may be related to developments in the 2017 Zimbabwean coup d'état. The market reaction in one bitcoin exchange is alarming as 1 BTC topped nearly US$13,500, just shy of 2 times the value of the International market.[166][167]
"Satoshi Nakamoto" is presumed to be a pseudonym for the person or people who designed the original bitcoin protocol in 2008 and launched the network in 2009. Nakamoto was responsible for creating the majority of the official bitcoin software and was active in making modifications and posting technical information on the bitcoin forum.[12] There has been much speculation as to the identity of Satoshi Nakamoto with suspects including Dai, Szabo, and Finney – and accompanying denials.[28][29] The possibility that Satoshi Nakamoto was a computer collective in the European financial sector has also been discussed.[30]

Researchers have pointed out at a "trend towards centralization". Although bitcoin can be sent directly to the bitcoin network, in practice intermediaries are widely used.[30]:220–222 Bitcoin miners join large mining pools to minimize the variance of their income.[30]:215, 219–222[107]:3[108] Because transactions on the network are confirmed by miners, decentralization of the network requires that no single miner or mining pool obtains 51% of the hashing power, which would allow them to double-spend coins, prevent certain transactions from being verified and prevent other miners from earning income.[109] As of 2013 just six mining pools controlled 75% of overall bitcoin hashing power.[109] In 2014 mining pool Ghash.io obtained 51% hashing power which raised significant controversies about the safety of the network. The pool has voluntarily capped their hashing power at 39.99% and requested other pools to act responsibly for the benefit of the whole network.[110]


In December 2013, Overstock.com[87] announced plans to accept bitcoin in the second half of 2014. On 5 December 2013, the People's Bank of China prohibited Chinese financial institutions from using bitcoins.[88] After the announcement, the value of bitcoins dropped,[89] and Baidu no longer accepted bitcoins for certain services.[90] Buying real-world goods with any virtual currency had been illegal in China since at least 2009.[91]
Various journalists,[204][211] economists,[212][213] and the central bank of Estonia[214] have voiced concerns that bitcoin is a Ponzi scheme. In 2013, Eric Posner, a law professor at the University of Chicago, stated that "a real Ponzi scheme takes fraud; bitcoin, by contrast, seems more like a collective delusion."[215] A 2014 report by the World Bank concluded that bitcoin was not a deliberate Ponzi scheme.[216]:7 The Swiss Federal Council[217]:21 examined the concerns that bitcoin might be a pyramid scheme; it concluded that, "Since in the case of bitcoin the typical promises of profits are lacking, it cannot be assumed that bitcoin is a pyramid scheme." In July 2017, billionaire Howard Marks referred to bitcoin as a pyramid scheme.[218]
In September 2012, Bitfloor, a bitcoin exchange, also reported being hacked, with 24,000 bitcoins (worth about US$250,000) stolen. As a result, Bitfloor suspended operations.[202][203] The same month, Bitfloor resumed operations; its founder said that he reported the theft to FBI, and that he plans to repay the victims, though the time frame for repayment is unclear.[204]
More recently, at a congressional hearing on Capitol Hill, global economist and New York University professor Nouriel Roubini said, "Crypto is the mother or father of all scams and bubbles." He called out "swindlers" who tapped into investors' fear of missing out and took them for a ride with "crappy assets that went into a bust and crash — in a matter of months — like you have not seen in any history of financial bubbles."

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