Recently, the Bitcoin cryptocurrency has attracted the interest of many people around the world. A sixfold jump in the virtual coin's price over the past few months confirms the growing interest in this cryptocurrency. A sharp drop in Bitcoin always makes investors shudder, but after the New Year holidays, the price usually stabilizes. Many people don't believe in the existence and usefulness of money that can't be felt. And increasingly, this type of currency is not considered serious and is perceived as a bubble or another scam, like a Ponzi scheme. But with the advancement of technology and the development of cyberspace, it's time to accept that cryptocurrency - this is simply a fundamentally new concept, the consequences of which we will still have to face, but cannot predict with certainty.
1. Bitcoin's creator remains a mystery. The most popular theory is that the currency's creator is a certain Satoshi Nakamoto. A pseudonym that could have been either a single person or a group of like-minded individuals. Whatever the case, the year Bitcoin's cryptocurrency was definitely established was 2008, when the first cryptographic protocol was published. However, the Bitcoin client was launched in 2009. The project changed hands a year later. The system and all authority over its configuration were transferred to Gavin Andresen.
Rumors often circulate that Nakamoto himself has amassed a million bitcoins; at current exchange rates, his capital would be valued at nearly $850 million.
2. The most important difference between cryptocurrency and the cash we're so accustomed to is its lack of control by any government. Such a currency has no regulator, making it autonomous, and no one has the right to ban it. In other words, Bitcoin is a set of codes that are passed between computers, and information about all transactions is encrypted. However, all participants in the system have access to it.
Bitcoin is often referred to as a "decentralized cryptocurrency.".
3. The issuance of cryptocurrency also lacks a single center responsible for it. This is precisely what created the next peculiarity of Bitcoin: the issuance or "mining" of coins depends on the system's users. They do this themselves, using special video cards on their computers or specialized equipment.«Mining»"—essentially making money out of thin air—is the "mining" of virtual money, which takes a lot of time and energy. Complex calculations require powerful hardware. It's worth noting that if a client with a super-powerful computer joins the group, it won't remain a secret to them. And with each new miner joining, the complexity of the process increases. Many have already created entire "farms" for mining bitcoins.
4. The Bitcoin algorithm contains another interesting fact: the maximum number of coins can never exceed 21 million. Once Bitcoin reaches this limit, the mining process will stop. Since the launch of the first client, more than half of the cryptocurrency has already been issued. Due to the ever-increasing complexity of this process, experts predict that mining will end as early as 2140.
5. The legal status of Bitcoin also remains an interesting issue, as it is interpreted differently everywhere. This is a weak point for the system. In China, a bank banned Bitcoin transactions. France called the cryptocurrency speculation. Thailand has not recognized virtual coins as an independent currency. At the government level, Bitcoin has no regulator and is not covered by any legal system or laws. Germany has decided that Bitcoin is more of a private currency, while Singapore has called it a digital commodity.
6. Virtual money can be spent on real things. You can buy electronics, clothing, and other goods from online stores, or pay for services. Converting electronic coins into real ones is entirely possible, and will soon become more accessible, as the number of exchangers and retail outlets accepting cryptocurrency is rapidly growing. Canada has acquired the first machine that can convert local dollars into Bitcoin and vice versa. Robocoin requires a palm print for identification. Funds can be deposited in cash or by credit card. This machine can process transactions of up to 3,000 Canadian dollars (approximately 2,900 US dollars) per day.
7. A common feature of all currencies, and Bitcoin is no exception, is their susceptibility to theft. It's difficult to find definitive proof of this, but such cases do occur. In one case, a user reported the disappearance of 25,000 bitcoins from their wallet. There are also cases of bitcoin theft as a result of hacker attacks.
8. Bitcoin isn't the only cryptocurrency. But it was the first to gain significant popularity. Alternatives followed suit, including Litecoin, which is mined four times faster; Peercoin, whose supply limit has yet to be established; Namecoin, which uses modified Bitcoin algorithms; and many others.
9. The Bitcoin system is characterized by anonymity of payments, which attracts the attention of the criminal underworld. The most famous example cited is the FBI-shutdown of the online drug marketplace Silk Road. The Tor network was used for this purpose, as it is not indexed by search engines. In addition to electronics, the site sold psychotropic substances, pornographic materials, and banned books. The FBI detained the site's owner and seized his servers containing the bitcoins stored there. A few days later, another wallet involved in the same site's operations was seized in the US. Nearly 30,000 bitcoins, equivalent to $25 million, were found on it.
10. The closed Tor network also became famous for the website Assassination Market, which was based on it. This platform offered users the opportunity to pay for the assassination of prominent political figures. To pay for the assassin's services, each visitor had to donate 1 bitcoin, with an encrypted date for the proposed assassination. The founders of the site received 1% from donations as a commission.
11. During the first year of Bitcoin mining, a UK resident mined 7,500 bitcoins using a laptop. An accidental spill of lemonade led the owner to dismantle the device to salvage the hard drive containing the coins. However, a few years later, the hard drive was thrown into a landfill. The programmer regretted his decision when the cryptocurrency's price jumped to $1,000. Attempts to find his treasure in the landfill proved futile, and the programmer lost approximately $6 million.
12. At the beginning of cryptocurrency mining, it was impossible to pay for anything with it. After some time, an American programmer decided to prove otherwise. He exchanged 10,000 electronic coins for two pizzas. At the time, this was worth $25. Today, this meal is considered the most expensive in history, costing approximately $8.5 million.