Bitcoin: A Guide to the World’s Leading Cryptocurrency
Over the last 10 years blockchain technology and its most famous incarnation, cryptocurrency, has grown into a multi-billion dollar industry, and an exciting new financial asset class that is primed to change global commerce forever.
Today there are well over 2,000 different cryptocurrencies, but no others have had as much impact and dominance of Bitcoin. Bitcoin is by far the most well-known digital asset available today, and is featured widely in literature covering cryptocurrencies and within the media.
One of the many reasons for the allure of the world’s largest cryptocurrency is its mysterious and almost-mythical origin story, and the ongoing drama that has surrounded it throughout the past decade.
The Creation and History of Bitcoin
Although most people if asked would say that Bitcoin began in 2008, in truth it was the legacy of the work completed by numerous cryptography researchers and computer scientists trailing back to the creation of a digital currency called Digicash in 1990.
Bitcoin was in fact not truly new a technology, but instead, a revolutionary way to solve multiple problems present when creating digital money using a combination of solutions, some new and some already discovered previously. For example, the concept of mining using ‘proof-of-work’ had already been created and described by Adam Back in his 2002 paper, ‘Hashcash — A Denial of Service Counter-Measure’.
All previous attempts at a widely-usable digital currency had failed, either because of flaws in their design or because of their ability to be shut down by governments (as was the case with Liberty Reserve).
In 2008, an anonymous individual or group under the pseudonym, ‘Satoshi Nakamoto’, released a now-famous whitepaper outlining the system they had designed known as ‘blockchain’, and its first incarnation, Bitcoin.
A few months later on the 3rd of Jan 2009, the Bitcoin genesis block was launched, providing the winning miner with a reward of 50 BTC. At first, the Bitcoin community was small and predominantly made up of computer scientists, cypherpunks and cryptography enthusiasts.
Progressively the size of the user base grew as Bitcoin was listed on a tailor-made exchange called ‘Mt Gox’, and for the first time, miners and traders were able to fluidly trade Bitcoin to generate profit.
Important Figures Behind Bitcoin
No other figure in relation to Bitcoin has generated as much interest, intrigue, and mystery as Satoshi Nakamoto, and to this day, he/she/they remain anonymous to the world.
In the earliest days of Bitcoin, its anonymous creator played an integral role in creating and distributing its original codebase, and working with other developers to implement upgrades.
Satoshi worked on the Bitcoin codebase directly until 2010 when they exited the scene, leaving the existing Bitcoin developers to take over.
Some of the most prevalent developers to work on Bitcoin have been Jimmy Song, Pieter Wuille, Jeff Garzik, and Gavin Andresen.
The Bitcoin Foundation
The Bitcoin Foundation works in tandem with the Bitcoin developers and acts as the executive body, information management, and dissemination group for Bitcoin.
The Bitcoin Foundation is a non-profit organization, and many of its directors have had integral roles in the development and growth of Bitcoin since near to the beginning of its life.
Roger Ver, Brock Pierce, Charlie Shrem, Bobby Lee and Vinny Lingham have all been directors of the Bitcoin Foundation at one point or another and have each had a large impact on the industry as a whole.
The Technical Details of Bitcoin
Bitcoin was the initial implementation of blockchain technology and has undergone many upgrades and major changes called ‘forks’ during its life.
Although Bitcoin does not have an in-built mechanism to allow for tokens to be created on top of it, as cryptocurrencies like Ethereum and NEO do, there have been a number of other cryptocurrencies created that started out by using the Bitcoin source code, such as Litecoin.
Bitcoin Technical Stats:
Genesis Block Date: 3rd Jan 2009
Creator(s): Satoshi Nakamoto
Type: Mineable Coin
Consensus Mechanism: Proof of Work (PoW)
Ability to Create Other Tokens: No
Current Transaction Speed: 3.888 Transactions Per Second
Source Code Forked by Other Cryptocurrencies: Litecoin, Bitcoin Cash, Bitcoin Gold, Bitcoin SV
Total Amount to Ever be Created: 21,000,000
Current Mining Reward: 12.5 BTC (approx. $100,000)
Time Between Rewards: approx. 10 minutes
Total Percentage of Bitcoins Mined So Far: 84.52%
Although the technology behind Bitcoin has stood the test of time for the past decade, there have been many ways that blockchain technology has been used since then to solve problems other than simply how to have a decentralized payments network.
With that being said, Bitcoin has been by far the most successful implementation of blockchain technology to date, and the technology behind it has drawn widespread praise as its value in society has become more and more apparent.
The Financial Metrics of Bitcoin:
Current Circulation Supply: 17,749,387
Current Marketcap: $138,463,442,133 USD
All-Time High Price: $19,665.39
All-Time High Date: 16th December 2017
Current 1-Year Bitcoin ROI: 0.94%
Current 3-Year Bitcoin ROI: 1234%
Current 5-Year Bitcoin ROI: 1081%
Total Number of Bitcoin Wallets: Approx. 32,000,000
Estimated Total Number of Active Users: Approx. 7,100,000
Where Bitcoin is Today and Where it Will Be Tomorrow
Today Bitcoin continues to lead the way as the world’s premier cryptocurrency, with no sign that this will change any time soon.
Bitcoin captures the majority of investment into cryptocurrencies, the majority of media coverage and public awareness, and the majority of daily trading volumes.
Its seen as the most trusted cryptocurrency today, and where many other cryptocurrencies have still been yet to deliver tangible use case applications, Bitcoin has remained as the world’s reserve cryptocurrency.
In response to problems with the speed of transactions possible using Bitcoin, a major upgrade known as the Lightning Network was introduced. The Lightning Network is an off-chain 2-layer scalability solution which is designed to allow Bitcoin to serve as a functional payment system which can scale to levels required to compete with others such as VISA and Ripple.
Early growth in the Lightning Network has demonstrated the potential for Bitcoin to remain as the world’s top cryptocurrency. Once this upgrade is operating at higher capacities it may be the case that the competitive edge of many other projects focused on high transaction speeds may be negated by the Lightning Network to a large degree.
