Bitcoin (2024)

Bitcoin is the world’s first decentralized cryptocurrency – a type of digital asset that uses public-key cryptography to record, sign and send transactions over the Bitcoin blockchain – all done without the oversight of a central authority.

The Bitcoin network (with an upper-case “B”) was launched in January 2009 by an anonymous computer programmer or group of programmers under the pseudonym “Satoshi Nakamoto.” The network is a peer-to-peer electronic payment system that uses a cryptocurrency called bitcoin (lower case “b”) to transfer value over the internet or act as a store of value like gold and silver.

Each bitcoin is made up of 100 million satoshis (the smallest units of bitcoin), making individual bitcoin divisible up to eight decimal places. That means anyone can purchase a fraction of a bitcoin with as little as one U.S. dollar.

Bitcoin price

Bitcoin’s price is renowned for being highly volatile, but despite that, it has become the top performing asset of any class (including stocks, commodities and bonds) over the past decade – climbing a staggering 9,000,000% between 2010 and 2020.

When the cryptocurrency was launched at the beginning of 2009, as Satoshi Nakamoto mined the bitcoin genesis block (the first-ever block on the Bitcoin blockchain), 50 BTC entered circulation at a price of $0.00.

Fifty bitcoin continued to enter circulation every block (created once every 10 minutes) until the first halving event took place in November 2012 (see below). Halvings refer to bitcoin’s issuance system, which was programmed into Bitcoin’s code by Satoshi Nakamoto. It essentially involves automatically halving the number of new BTC entering circulation every 210,000 blocks.

In February 2011, BTC’s price reached parity with the U.S dollar for the first time. The milestone encouraged new investors into the market, and over the next four months, bitcoin’s price continued to rise – peaking at over $30.

By early 2013, the leading cryptocurrency had recovered from a prolonged bearish episode and rose above $1,000, albeit only briefly. But with the infamous Mt Gox hack, China announcing its first ban on crypto and other situations, it took a further four years for the BTC price to return to above $1,000 again. Once that level was passed, however, bitcoin’s price continued to surge dramatically throughout 2017 until BTC peaked at its previous long-standing all-time high of $19,850.

Over 2018, the entire crypto market plunged into what is now known as the “crypto winter” – a yearlong bear market. It wasn’t until December 2020, when bitcoin returned to test the previous all-time high, that it eventually surpassed that historical level and rose a further 239% over the next 119 days to a new all-time high of $64,799.

What is Bitcoin?

Bitcoin is the world’s first decentralized cryptocurrency – a type of digital asset that uses public-key cryptography to record, sign and send transactions over the Bitcoin blockchain – all done without the oversight of a central authority. It was launched in January 2009 by an anonymous computer programmer or group of programmers under the pseudonym 'Satoshi Nakamoto'.

How does Bitcoin work?

Bitcoin and other cryptocurrencies are like the email of the financial world. The currency doesn’t exist in a physical form, and the coin is transacted directly between the sender and the receiver without banking intermediaries to facilitate the transaction. Everything is done publicly through a transparent, immutable, distributed ledger technology called blockchain.

  • Here are the main features of blockchain technology:

  • Bitcoin transactions are recorded on a public, distributed ledger known as a “blockchain” that anyone can download and help maintain.

  • Transactions are sent directly from the sender to the receiver without any intermediaries.

  • Holders who store their own bitcoin have complete control over it. It cannot be accessed without the holder’s cryptographic key.

  • Bitcoin doesn’t exist in a physical form.

  • Bitcoin has a fixed supply of 21 million. No more bitcoin can be created and units of bitcoin cannot be destroyed.

  • Bitcoin users send and receive coins over the network by inputting the public-key information attached to each person’s digital wallet.

In order to incentivize the distributed network of people verifying bitcoin transactions (miners), a fee is attached to each transaction. The fee is awarded to whichever miner adds the transaction to a new block. Fees work on a first-price auction system, where the higher the fee attached to the transaction, the more likely a miner will process that transaction first.

Every single bitcoin transaction that takes place has to be permanently committed to the Bitcoin blockchain ledger through a process called “mining.” Bitcoin mining refers to the process where miners compete using specialized computer equipment known as application-specific integrated circuit (ASIC) chips to unlock the next block in the chain.

Unlocking blocks work as follows:

  • Crypto mining uses a system called cryptographic hashing. This function simply takes any input (messages, words or data of any kind) and turns it into a fixed-length alphanumeric code known as a “hash.”

  • Each input creates a completely unique hash, and it’s almost impossible to predict what inputs will create certain hashes. Even changing one character of the input will result in a totally different fixed-length code.

  • Each new block has a value called a “target hash.” In order to win the right to fill the next block, miners need to produce a hash that is lower than or equal to the numeric value of the ‘target’ hash. Since hashes are completely random, it’s just a matter of trial and error until one miner is successful.

This method of requiring miners to use machines and spend time and energy trying to achieve something is known as a proof-of-work system and is designed to deter malicious agents from spamming or disrupting the network.

Whoever successfully unlocks the next block is rewarded with a set number of bitcoin known as “block rewards” and gets to add a number of transactions to the new block. They also earn any transaction fees attached to the transactions they add to the new block. A new block is discovered roughly once every 10 minutes.

Bitcoin block rewards decrease over time. Every 210,000 blocks, or about once every four years, the number of bitcoin received from each block reward is halved to gradually reduce the number of bitcoin entering the space over time. As of 2021, miners receive 6.25 bitcoins each time they mine a new block. The next bitcoin halving is expected to occur in 2024 and will see bitcoin block rewards drop to 3.125 bitcoins per block. As the supply of new bitcoin entering the market gets smaller, it will make buying bitcoin more competitive – assuming demand for bitcoin remains high.

Who created Bitcoin?

The creator of Bitcoin, known only by the pseudonym "Satoshi Nakamoto," first proposed this revolutionary digital currency in a 2008 whitepaper titled "Bitcoin: A Peer-to-Peer Electronic Cash System." Satoshi devised Bitcoin as a decentralized, peer-to-peer network, able to facilitate financial transactions without a central authority like a government or bank. In doing so, Satoshi solved a key issue, the double-spending problem, by creating a proof-of-work consensus mechanism within a blockchain structure. Bitcoin's network was activated in January 2009 when Satoshi mined the first block, or the "genesis block." Despite the transformative impact of Bitcoin, Satoshi Nakamoto's identity remains shrouded in mystery, a symbol of the privacy-oriented ethos at the heart of the cryptocurrency movement.

Bitcoin’s energy consumption

The process of requiring network contributors to dedicate time and resources to creating new blocks ensures the network remains secure. But that security comes at a price. As of 2021, the Bitcoin network consumes about 93 terawatt hours (TWh) of electricity per year – around the same energy consumed by the 34th-largest country in the world.

This appetite for electricity has drawn widespread criticism from celebrities such as Tesla CEO Elon Musk to government bodies such as China’s State Council and the U.S. Senate over Bitcoin’s impact on climate change. But while the electricity figures are alarmingly high, it’s important to note that bitcoin mining at most accounts for 1.29% of any single country’s energy consumption. Not to mention, Bitcoin is a complete financial system whose energy consumption can be measured and tracked, unlike the fiat system, which cannot be accurately measured and requires a range of additional layers to function, including ATMs, card machines, bank branches, security vehicles, storage facilities and huge data centers.

There are also a number of initiatives including the Crypto Climate Accord and the Bitcoin Mining Council that aim to improve Bitcoin’s carbon footprint by encouraging miners to use renewable sources of energy.

Management

As already mentioned, the Bitcoin network was created by a pseudonymous programmer, or group of programmers, known only as “Satoshi Nakamoto.” During its early development, other developers joined to work on the protocol, including cypherpunk Hal Finney, cryptographers Wei Dai and Nick Szabo and software developer Gavin Andresen.

There were also a range of other developers including Pieter Wuille and Peter Todd who contributed to the development of Bitcoin Core – the first client on the Bitcoin network. A client is a piece of software that enables a network participant to run a node and connect to the blockchain.

An American nonprofit called the Bitcoin Foundation was founded in 2012 to support the development and adoption of the Bitcoin protocol. After three years, however, the foundation eventually ran out of cash and was dissolved.

In 2014, Adam Back, another cypherpunk and the inventor of Hashcash – a cryptographic hashing algorithm created in 1997 which used the same proof-of-work mechanism that Bitcoin would later adopt – co-founded Blockstream. Blockstream is a for-profit tech company that develops new infrastructure on the Bitcoin network, including Lightning Network and sidechains.

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Bitcoin (2024)

FAQs

Bitcoin? ›

Bitcoin Overview

Our most recent Bitcoin price forecast indicates that its value will increase by 12.76% and reach $75,086 by July 22, 2024. Our technical indicators signal about the Bullish Bullish 81% market sentiment on Bitcoin, while the Fear & Greed Index is displaying a score of 74 (Greed).

How much is $1 Bitcoin in US dollars? ›

Current BTC to USD exchange rate

1 BTC equals 66,959.00 USD. The current value of 1 Bitcoin is +0.58% against the exchange rate to USD in the last 24 hours.

Are Bitcoin a good investment? ›

​Investor takeaway

For that reason, while current market conditions are favorable for anyone considering buying Bitcoin, it is an asset you should purchase only at your own risk. Because while Bitcoin may have the potential for significant returns, you may also lose most of your investment.

Who owns the most Bitcoin? ›

So, who are the top holders of BTC? According to the Bitcoin research and analysis firm River Intelligence, Satoshi Nakamoto, the anonymous creator behind Bitcoin, is listed as the top BTC holder as of 2024. The company notes that Satoshi Nakamoto holds about 1.1m BTC tokens in about 22,000 different addresses.

How long does it take to mine 1 Bitcoin? ›

On average, it takes around 10 minutes to mine 1 Bitcoin with ideal hardware. However, the time required to mine 1 BTC depends on your hardware and software, especially the mining power. But if you want to mine BTC with an average PC, you will make 0.000000297/year.

How much is $100 Bitcoin worth right now? ›

$6,717,581.00

How much is $500 Bitcoin in US dollars? ›

About Bitcoin
BTCUSD
500 BTC32,878,154.26 USD
1,000 BTC65,756,308.53 USD
5,000 BTC328,781,542.69 USD
10,000 BTC657,563,085.39 USD
7 more rows

What will $1000 of Bitcoin be worth in 2030? ›

If Wood is correct and Bitcoin does reach $3.8 million by 2030, an investment of $1,000 would be worth over $60,000. This would result in a compound annual growth rate (CAGR) of over 100%. Read Next: Bitcoin has jumped another 45% already this year – how much would you need to get started today?

Can Bitcoin go to zero? ›

A reasonable assumption that Bitcoin could hypothetically reach the null state of it's value is worth the thought. Even-though such an event is very less likely to take place, there are some factors that could theoretically lead to Bitcoin price crashing to zero.

How much will 1 Bitcoin be worth in 2025? ›

Bitcoin (BTC) Price Prediction 2030
YearPrice
2025$ 70,125.62
2026$ 73,631.90
2027$ 77,313.49
2030$ 89,500.03
1 more row

Does Elon Musk own Bitcoin? ›

"I still own a bunch of dogecoin, and SpaceX owns a bunch of bitcoin," Musk said during an X Spaces broadcast, referring to his rocket company. Musk's electric car company Tesla also holds just over 10,000 bitcoin worth almost $500 million.

How many millionaires own Bitcoin? ›

With that in mind, the actual numbers behind the Bitcoin distribution are still surprising: 46.8 million wallet addresses have more than $1. 10,000 wallets have more than $10 million in Bitcoin. 100,000 wallets have more than $1 million.

Who is the richest Bitcoin owner? ›

For the third year running, Changpeng Zhao, founder and former CEO of crypto exchange Binance, is crypto's wealthiest person.

How many bitcoins are left? ›

How much is Bitcoin? Limited Supply: Bitcoin has a maximum supply of 21 million coins, and as of March 2023, more than 19 million have been mined. Remaining bitcoins: There are approximately 1.5 million bitcoins left to be mined. Impact on Value: Knowing this matters because it affects Bitcoin's value and future price.

Can I mine bitcoin for free? ›

Yes. Libertex provides free Bitcoin mining to its users via a virtual miner. There are no hidden charges or fees to start earning with our virtual Bitcoin miner. Miners may increase their mining speeds and, consequently, mining profit by upgrading their status in our customer loyalty programme.

Can a normal person mine bitcoin? ›

Anyone can participate in the Bitcoin mining process, but unless you have access to powerful computers known as ASICs (that's “application-specific integrated circuits”), your chances of winning a Bitcoin reward are pretty low. » Not up for mining? Here's how to buy Bitcoin.

How much would $1 dollar in Bitcoin be worth today? ›

Current USD to BTC exchange rate

1 USD equals 0.000016 BTC. The current value of 1 United States Dollar is +3.25% against the exchange rate to BTC in the last 24 hours. ​ The current Bitcoin market cap is $1.26T. ​Create a free Kraken account to instantly convert USD to BTC today.

How many Bitcoin is $1,000 USD? ›

Latest USD to BTC price calculator
USDBitcoin
500 USD0.01 BTC
1000 USD0.02 BTC
2500 USD0.04 BTC
8 USD0.00 BTC
28 more rows

How much is $20 in Bitcoin right now? ›

Latest USD to BTC Converter Rate

The current price of 20 US Dollar in Bitcoin is 0.0003068 BTC.

Can you cash out Bitcoin? ›

One of the easiest ways to cash out your cryptocurrency or Bitcoin is to use a centralized exchange such as Coinbase. Coinbase has an easy-to-use “buy/sell” button and you can choose which cryptocurrency you want to sell and the amount.

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