What is bitcoin? For Dummies

Bitcoin is the first and foremost cryptocurrency. There were no cryptocurrencies before bitcoin, and all existing cryptocurrencies in one way or another came from bitcoin. So what is bitcoin? Bitcoin is software created by the genius programmer Satoshi Nakamoto. It is difficult to classify this program in any class, because with bitcoin, the author said a completely new word in the field of modern technology.

What should you know about bitcoin?

Any file on a computer can be copied – theoretically any number of times. Before Nakamoto, the only way to limit copying was to control the user through a single center, usually in the form of a server. This is the principle on which electronic money and modern computerized banking systems are based. Financial transactions are made digitally under the control of the bank or e-money owner.

This central control solves the problem of double spending because all data related to electronic payments are stored in one place, it becomes impossible to spend the same money twice. But there are two problems:

  • such an electronic payment service can be hacked;
  • the owner of the service has the ability to block any payment and any user of the system at any time.

At first glance it seems impossible to solve these two problems. Nevertheless, that is exactly the system Nakamoto created. Bitcoin is built on blockchain technology. Information, formatted as blocks, is distributed over a global database supported by a network of computers connected to the Internet and protected by encryption. The impetus for the existence and development of this network is bitcoin – so the part of the blocks that has the property of having its own owner. The creators of the blocks (miners) are rewarded with bitcoins. However, it is not the miners’ labor that determines the value of a bitcoin, but the number of its users. If you want to buy bitcoins and make sure they are unique, use https://cryptopay.me/buy-bitcoins. Here you can also get a bitcoin card.

Bitcoin is programmed in such a way that its issuance is limited. That is, it is a value that cannot be freely produced. That is why bitcoin is called not only virtual currency, but also digital gold.

However, all attempts to express the essence of bitcoin using pre-existing entities are bad. Imagine having to explain what electricity is to someone who has never seen a single electrical appliance. What does electricity look like? Like light in terms of speed and water in terms of propagation? Exactly to the extent that electricity is like light and water, bitcoin is like money and gold. In fact, we just don’t know yet where this new technology will lead us, just as Thomas Edison could not have foreseen the computer.

The creation of bitcoin has paved the way for the storage, replenishment and automatic use of any information of value. It could be property registries or reward systems for content creators, or something we can’t yet imagine. You can even use bitcoin debit cards https://cryptopay.me/.

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