13 Years ago on Halloween, the pseudonymous identity (an unknown person or persons) by the name of Satoshi Nakamoto published the Bitcoin whitepaper as an immediate response to the financial crisis of 2008.
Nakamoto announced to the world via a cryptography forum the creation of the first fully open sourced, and fully decentralized digital currency that solved the double spend problem; that is prevention of digital duplication.
With that, Bitcoin was born.
I won’t get into the specifics of the technical mechanics of Bitcoin as that is beyond the needs of this reader. Plus the Bitcoin Whitepaper authored by Nakamoto goes over all of the details needed to understand Bitcoin from a technical point of view.
As the reader what you need know about Bitcoin is below.
Bitcoin is digital. It is a immutable compute network. It cannot be held, there is no coin issued by a central authority. There is no bank note that is Bitcoin.
You can acquire part of a Bitcoin. Each Bitcoin is divisible into 100,000,000 units called Satoshis (Sats) by the wider Bitcoin early adopters in honour of Nakamoto. At the time of writing one USD will net you about 1,600 Sats, or 0.00001600 Bitcoin.
Bitcoin is fixed and finite in supply. There will only ever be 21,000,000 Bitcoins; ever. To put this scarcity into perspective there are more millionaires globally than there are Bitcoin.
Bitcoin is “minted” into existence using complex hashing functions to validate and secure the network by entities known as miners. Miners are rewarded with Bitcoin for securing the network and processing transactions for the users of the network.
Bitcoin’s inflation rate is known in advance. Approximately every 10 minutes new Bitcoin is “minted” into existence by miners securing the network as a new block is added to the Bitcoin blockchain. These rewards are issued on a step function half-life curve every 210,000 blocks (approximately every 4 years).
Almost 19 million Bitcoin have been mined to date, leaving 2 million left to be mined. The last Bitcoin is expected to be minted somewhere between the year 2136 and 2140.
Bitcoin is visible to everyone and controlled by no one. Anyone can run a node to validate the transactions on the network. No one can change the supply.
Bitcoin doesn’t require the permission of a third party to transact on the network. No bank required.
Bitcoin is self custodial. You can acquire a wallet that contains a seed phrase (also known as “keys”) in case of loss. If you lose your wallet, so long as you remember your seed phrase you can recover your Bitcoin from anywhere.
Bitcoin cannot be confiscated by a third party, so long as you are the only one who controls your keys.
Bitcoin is global. It knows no boarders. One Bitcoin in the West is worth one Bitcoin in the East.
Bitcoin and its network is incapable of discrimination when making transactions. This makes the network the most fair financial network in the world. It doesn’t discriminate against you regardless of your race, religion, political affiliation, sexual orientation, social status, employment status, etc; the list goes on.
Bitcoin developers have created a secondary network called Lightning that uses the Bitcoin network to transact value over the Internet faster than any bank or other financial institution, at a fraction of the cost, and at a greater bandwidth than the entire global credit card network.
Nation states are adopting Bitcoin as legal tender. The country of El Salvador was the first to do this in 2021.
In the near future I will explain how Bitcoin is different from every currency that we use on a regular basis.
Until then stack Sats and HODL on.