History of Bitcoin
Last updated
Last updated
Bitcoin was created out of the turmoil of the 2008 Great Recession as distrust of banks and their role in the financial system grew. An individual or a group of people going by the name Satoshi Nakamoto issued a white paper to address the centralised control of money and the trust required in handling citizens' cash.
"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.
The inventor of Bitcoin remains a bit of a mystery. A paper titled Bitcoin: A Peer-to-Peer Electronic Cash System was posted on Oct. 31, 2008 to a cryptography mailing list with “Satoshi Nakamoto” as the author. However, Nakamoto has never revealed any personal information about himself and his identity has never been confirmed.
In 2009, Bitcoin was first used after it was released as open-source software, when Nakamoto mined the starting block of the blockchain. This is referred to as the Genesis Block, and it contained the first 50 Bitcoins ever created. From then on, Bitcoin continued to be mined by other early contributors until 2010. That’s when programmer Laszlo Hanyecz made the first known payment using the cryptocurrency through the purchase of two Papa John’s pizzas for 10,000 Bitcoins.
Bitcoins are the unit of currency of the Bitcoin system. A commonly used shorthand for this is “BTC” to refer to a price or amount (e.g. “100 BTC”). There are such things as physical bitcoins, but ultimately, a bitcoin is just a number associated with a Bitcoin Address. We talk about bitcoin more here.
Bitcoin is a distributed peer-to-peer digital currency that can be transferred instantly and securely between any two people in the world. It's like electronic cash that you can use to pay friends or merchants.
The core technology behind bitcoin is blockchain, which is what we will look at next...