What is a Bitcoin
A bitcoin is a kind of digital currency which can be worth more than gold. It was invented in 2009 by an unknown programmer who goes by the name of Satoshi Nakamoto.
A transaction is made between 2 people, so a person wanting to buy, trade, or sell a bitcoin doesn’t need to pay a fee to a third party or give their personal details to anyone if they don’t want to.
Bitcoins aren’t printed like other currency; they are virtual in nature. In fact, bitcoin is the first of a new kind of currency, called cryptocurrency. The process where a bitcoin is created is called mining. To mine one, a computer must first solve a mathematical equation, with a solution that is 64-digits long.
There are currently around 15 million in existence; with around 6 million people owning them – and with the number in circulation increasing every day, the number of people who own them is growing.
A bitcoin can be worth a lot of money and, in much the same way as their production and ownership, their value is increasing, too.
However, the bitcoin protocol (the rules which make bitcoins work) only allows a maximum of 21 million of the new currency to be manufactured. Each bitcoin can also be divided into smaller pieces, where the smallest is one hundred millionth of a full one. This is called a Satoshi, after the creator.
Where can I get a bitcoin?
There are several different markets, called bitcoin exchanges, which allows anybody to buy or sell bitcoins – and in all different kinds of currencies, too. They can also be sent through mobile or computer apps, in much the same way as people can send money virtually.
Will it last?
Some people are unsure if bitcoins will still be worth money in the future. This is probably because of the fact that the system isn’t regulated. Some governments are concerned about bitcoins, as they have no control over them.
Another reason why this could cause a problem for the bitcoins is because it keeps a person’s transactions private. This allows people to buy (or sell) anything with a lessened risk of being caught, and this has attracted people who want to buy or sell illegal items, such as drugs.
However, even with these concerns, many people still buy, sell and trade bitcoins in their thousands, keeping the currency alive – at least, for the time being.