What is Bitcoin?

May 10, 2021 1 min read

Bitcoin (BTC) is the first widely known cryptocurrency, and was released in January 2009. It was invented by a pseudonymous individual (or group) known as Satoshi Nakamoto. As an honour, the smallest unit of Bitcoin is known as a ‘satoshi’, i.e. 0.00000001 BTC. The ideas that birthed Bitcoin can best be understood from the whitepaper published by Nakamoto, which contains the now famous sentence: "The root problem with conventional currencies is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust."

Bitcoin works on a Proof of Work (PoW) consensus algorithm, which means that computers on the network known as ‘miners’ contribute their CPU power to solve mathematical problems,  and are rewarded with appropriate amounts of BTC in return. The miners are important as they ensure the validity of the transactions going through the network.

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