What is Bitcoin?
How does Bitcoin work (and why does it matter)?
Bitcoin and other digital currencies have become known as cryptocurrencies. So if you hear the word cryptocurrency they are simply referring to a digital currency that was made possible by blockchain technology.
Now that we've explored the basics of blockchains, it's helpful to look at why Bitcoin was originally created as an example of their actual real world benefits.
Why was Bitcoin created?
Bitcoin was created in 2009 partly in response to a combination of the financial collapse of the banking industry, the role central governments played in that, and the increasing dominance of the internet by big tech.
The idea behind Bitcoin is that transactions would be verified by code instead of being brokered by a bank or a government agency. Advocates argue this is a more fair system: the code sets the rules and there is no favoritism. So for the first time, people could own currency without a government or tech company as a middle man. Individuals essentially become "their own bank" - storing digital assets that no one else can take away or interfere with. As Bitcoin proponents like to say: "not your keys, not your coins."
On the surface Bitcoin is digital money, but underneath is a powerful foundation that gives a new way of doing business.
Let's take a look at the effect that Bitcoin has had on the world and the way we do business.