Explaining Bitcoin

Explaining Bitcoin


Bitcoin was made by Satoshi Nakamoto. It is supposedly a secure, decentralized peer-to-peer cryptocurrency powered by blockchain technologies. The genesis block was mined by Satoshi Nakamoto on the 3rd of Janurary, 2009.

a blockchain consists of a genesis block, the first block, and after that, blocks will always use some of the last block as a way to compute block hashes, so that changing one block will make it incompatible with the rest of the blockchain.

To stop people from changing one block to give it to themselves and then recalculating the rest of the blockchain, the proof-of-work algorithm was made to slow them down.

Once a block is mined, to further prevent blockchain changing, the blockchain on the computer will be sent to other computers and validated. If the rest of the blockchain matches, the new block is added to the blockchain.

The first users of bitcoin were the black market. In February 2011, Silk Road started selling and buying with Bitcoin. In 2013, prices went up to 770 from 13.30, starting what would be known as the cryptocurrency bubble. It reached $19,783 on 17th December 2017. 

Bitcoin prices then dropped in 2018, in what we know as the popping of the cryptocurrency bubble. Hacking and theft made people lose trust in Bitcoin, and when those people sold their Bitcoin, other people were worried by the dropping price and sold their bitcoins as well, making the price drop even more.

In 2020, due to another price collapse before the COVID-19 outbreak, investors bought bitcoin and other currencies hoping to profit from the low prices, and users increased due to the quarantines taking place making cash transactions undesirable. Therefore, the price of various cryptocurrencies started rising. it is unknown whether or not it will drop again.

Thanks for reading.

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Explaining Cryptocurrencies
Explaining Cryptocurrencies

This blog is for explaining what cryptocurrencies are and going through their pros and cons.

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