Bitcoin: Origins, Technology, and Impact
Explore Bitcoin’s creation, how it works, and its global impact.
What You Will Learn
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History: How Bitcoin emerged from the 2008 financial crisis.
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Technology: Proof of Work, mining, and wallet security.
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Impact: Bitcoin’s role in finance, remittances, and decentralization.
What is Bitcoin?
Bitcoin is a decentralized digital currency that enables peer-to-peer transactions without intermediaries. It was created in 2009 by an anonymous entity known as Satoshi NakamotoPseudonym used by Bitcoin’s creator(s).
Bitcoin uses blockchain technology to ensure security, transparency, and immutability. It has a capped supply of 21 million coins, making it scarce and resistant to inflation.
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History of Bitcoin
Origins
In 2008, the Bitcoin whitepaperA 9-page document outlining Bitcoin’s design was published by Satoshi Nakamoto. The first block (Genesis Block) was mined in January 2009.
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Key Milestones
- 2009: First Bitcoin transaction between Satoshi and Hal Finney
- 2010: First real-world purchase (2 pizzas for 10,000 BTC)
- 2017: Bitcoin hits $20k, ETFs gain traction
- 2021: Institutional adoption and El Salvador adopts Bitcoin as legal tender
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Bitcoin Technology
Mining
Miners validate transactions via Proof of Work. New blocks are mined every 10 minutes.
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Wallets
Users store Bitcoin in wallets (software, hardware, or paper) secured by private keys.
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Transactions
Bitcoin transactions are irreversible and recorded on the blockchain for transparency.
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Bitcoin Use Cases
Payments
Used for peer-to-peer transactions and online purchases.
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Store of Value
Often called "digital gold" due to its scarcity and durability.
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Remittances
Used for low-cost cross-border money transfers.
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Bitcoin Challenges
- ✅ Scalability: ~7 transactions per second vs. Visa’s 24,000
- ✅ Energy Consumption: Mining requires massive electricity
- ✅ Regulation: Governments debate legality and taxation
- ✅ Volatility: Price swings make it risky for daily use
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Knowledge Check
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