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Bitcoin () is a cryptocurrency, a type of electronic cash. It's a decentralized digital currency without a central bank or single administrator which can be sent out of user-to-user on the peer-to-peer bitcoin network without the need for intermediaries.7
Transactions are verified by network nodes via cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people using the name Satoshi Nakamoto9 and published as open-source software in 2009.10 Bitcoins are created as a reward for a process known as mining.
Research produced by the University of Cambridge estimates that in 2017, there were 2.9 to 5.8 million unique users using a cryptocurrency wallet, most of them using bitcoin.12.
Bitcoin has been criticized because of its use in prohibited transactions, its own high power consumption, price volatility, thefts from exchanges, and the possibility that bitcoin is an economic bubble.13 Bitcoin has also been used as an investment, although many regulatory agencies have issued investor alerts about bitcoin.14
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The domain name"bitcoin.org" was registered on 18 August 2008.15 On 31 October 2008, a link to a paper authored by Satoshi Nakamoto titled Bitcoin: A Peer-to-Peer Electronic Cash System5 was submitted to some cryptography mailing list.16 Nakamoto implemented the bitcoin applications as open-source code and released it in January 2009.171810 Nakamoto's identity remains unknown.9.
In January 2009, the bitcoin network was created when Nakamoto mined the first block of this chain, known as the genesis block.1920 Embedded in the coinbase of this block was the following text:"The Times 03/Jan/2009 Chancellor on brink of second bailout for banks. "10 This note has been interpreted as both a timestamp and a comment on the instability brought on by fractional-reserve banking.21:18.
The recipient of the initial bitcoin transaction was cypherpunk Hal Finney, that made the first reusable proof-of-work platform (RPOW) in 2004.22 Finney downloaded the bitcoin applications on its release , and on 12 January 2009 received ten bitcoins from Nakamoto.2324 Other ancient cypherpunk supporters were founders of bitcoin predecessors: Wei Dai, creator of b-money, and Nick Szabo, creator of little gold.25 In 2010, the earliest known commercial transaction using bitcoin occurred when click here to read developer Laszlo Hanyecz bought two Papa John's pizzas for 10,000 bitcoin.26.
Nakamoto is estimated to have mined one million bitcoins27 before disappearing in 2010, when he handed the network awake key and control of the code repository over Gavin Andresen. Andresen later became lead developer at the Bitcoin Foundation.2829 Andresen then sought to decentralize control. This left opportunity for controversy to develop over the future development course of bitcoin.3029.
After ancient"proof-of-concept" transactions, the first significant consumers of bitcoin were black markets, such as Silk Road. During its 30 months of existence, beginning in February 2011, Silk Road exclusively accepted bitcoins as payment, transacting 9.9 million in bitcoins, value roughly $214 million.31:222
In 2011, the price started at $0.30 each bitcoin, growing to $5.27 for the year. The price rose to $31.50 on 8 June. Within a month that the price fell to $11.00. The next month it dropped to $7.80, and in another month to $4.77.32
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Litecoin, an early bitcoin spin-off or altcoin, appeared in October 2011.33 Many altcoins have been created since then.34
In 2012, bitcoin prices started at $5.27 growing to $13.30 for its year.32 By 9 January the cost had risen to $7.38, but then dropped by 49% to $3.80 over the next 16 days. The cost then rose to $16.41 on 17 August, but fell by 57% to $7.10 within the next 3 times.35.
In March 2013 that the blockchain temporarily split into two independent chains with different rules. The 2 blockchains operated simultaneously for half an hour, each with its own version of the transaction history. Normal operation was restored when the majority of the network downgraded to version 0.7 of the bitcoin software.37 The Mt.
Gox experienced processing delays because of insufficient capacity44 resulting in the bitcoin cost dropping from $266 to $76 prior to returning to $160 within six hours.45 The bitcoin cost rose to $259 on 10 April, but then dropped by 83 percent to $45 over the next 3 days.35 On 15 May 2013, US authorities seized accounts associated with Mt.
881.48 This marked the first time a government agency had seized bitcoin.4950 The FBI captured about 26,000 bitcoins in October 2013 from the dark web website Silk Road during the arrest of Ross William Ulbricht.515253 best site Bitcoin's cost climbed to $755 on 19 November and dropped by 50 percent to $378 exactly the exact same moment.
In 2014, prices started at $770 and dropped to $314 for the year.32 In February 2014 the Mt. Gox exchange, the largest bitcoin exchange at the time, stated that 850,000 bitcoins had been stolen from its own clients, amounting to nearly $500 million. Bitcoin's price fell by nearly half, from $867 to $439 (a 49% drop).