The decentralized network that operates the first viable, purely digital currency
Bitcoin is the world’s first decentralized blockchain network that facilitates the use of the first viable cryptocurrency, which trades under the ticker BTC. It was launched in early 2009 by an anonymous developer or group calling themselves Satoshi Nakamoto.
Nakamoto first described their system in a white paper circulated to a cryptography mailing list in October 2008. By combining many of the ideas developed by earlier cryptographers and cypherpunks, Nakamoto managed to solve a problem that had been the downfall of previous digital cash systems — i.e., double-spending.
Nakamoto’s system completely removed all central authorities. In traditional monetary systems, users must trust intermediaries — often banks — to update their records accurately and create new currency units responsibly. By contrast, the Bitcoin protocol itself regulates the issuance of new BTC and the processing of transactions without any third-party oversight.
Nakamoto’s various writings and forum posts suggest the developer had a strong disdain for central banking. For example, there are numerous references to fiat currency debasement via excessive monetary printing throughout their work. Moreover, Bitcoin’s creation occurred during a major financial crisis during which many institutions received government handouts to prevent bankruptcy.
In addition to elegant game-theoretical assumptions creating the checks and balances that prevent any single user from taking a commanding role in the system, Nakamoto designed Bitcoin with a supply cap of 21 million BTC. Unlike fiat currencies — which can be printed on a whim when failed financial institutions or companies require government bailouts to stay operational — no new Bitcoin can ever be created without the entire network’s agreement. The protocol itself regiments the steadily decreasing issuance of new BTC at timely intervals via a process known as proof-of-work, or mining.