Thoughts

23 Facts That Will Help You Understand Bitcoin.

Money

We can ridicule it. We can ignore it. We can call it names. But it is coming. So, what does all this mean?

1. On 22 May 2010, two Papa John’s Pizzas were exchanged by Laszlo Hanyecz for 10,000 BTC. This was the first official documented purchase of goods using bitcoins. At that time, the worth of 10,000 BTC was $41. At the time of writing this article, the worth of 10,000 BTC is around $25.8 million.

2. There will only ever be 21 million bitcoins. At present, 16.3 million have already been mined and are being traded. The last Bitcoin will be mined in 2140. After that, no new Bitcoins can be mined.

3. Bitcoin can’t be banned. Due to the nature of Bitcoin, there is constant talk
about “banning” it. This hostility towards Bitcoin is because it works outside the jurisdiction of the traditional banking system. However, the fundamental design is such that it can’t be banned, only regulated. As long as you have an internet connection and a Bitcoin wallet, you can engage in Bitcoin.

4. Bitcoins are mined on the blockchain network, and they come into existence when miners successfully mine Bitcoin blocks. At present, the mining power of Bitcoin’s network is 300 times more powerful than the world’s top five supercomputers combined.

5. If you lose your Bitcoin private key, you lose your bitcoins.

6. Bitcoin is untraceable and Bitcoin is not untraceable. When making Bitcoin transactions, your name/identity is not used in any form. Only your public address is available. But the Bitcoin blockchain is a permanent ledger which is transparent. If anyone knows your Bitcoin public address, they can see how many bitcoins you hold and what transactions you have made.

7. The Bitcoin whitepaper was made open to the public under the pseudonym of Satoshi Nakamoto. The identity of Satoshi is still a mystery yet to be solved. As of 3rd January 2018, Nakamoto holds 1 million Bitcoins, equivalent to $16.5 billion.

8. No one person controls Bitcoin, it exists on a blockchain.

9. Bitcoins are kept in software wallets.

10. Bitcoin is a digital currency that exists outside the banking infrastructure.

11. Bitcoin was created by people, not a government.

12. Bitcoin was released in 2009.

13. Miners solve complex maths problems and create bitcoins.

14. Bitcoin is only one of the hundreds of cryptocurrencies.

15. Bitcoin is the most popular and the first mover in the blockchain/cryptocurrency space.

16. According to the experts, the Bitcoin network has a computing power of 2,046,364 Pflop/s. This is my personal favourite fact about bitcoin. If you go ahead and combine the computing power of the 500 most powerful supercomputers, you’ll get a combined fever of 274 Pflop/s.

17. Bitcoins generated as a reward for mining halves every 4 years until all Bitcoins are fully mined.

18. A new block of coins is solved every ten minutes which leads to about six new discoveries of Bitcoins per hour.

19. A bitcoin transfer is irreversible.

20. 1% of the Bitcoin community controls 99% of the world’s Bitcoin wealth.

21. The Winklevoss twins (best known for their lawsuit against Mark Zuckerberg) own 1% of all Bitcoins in existence and started investing in them when they were only $9 per coin.

22. 64% of Bitcoins have never been used. And may never be used.

23. From March 2015 to February 2017, Bitcoin transactions are up by 1289%.

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