In a nutshell, what is Bitcoin?

Ask around and see what you get. Buffett would answer it’s “probably rat poison squared” if asked. (But then proceeds to fund a cryptocurrency-centric online bank.)

Because you do not spend your days in a cave (how else would you be reading this), you have probably definitely heard about bitcoin.

Bitcoin was the first proper trve cryptocurrency ever created.

Bitcoin is a novel form of “money,” a digital currency created to facilitate online transactions including the storage, transfer, and receiving of “money” without the need for centralized financial institutions like banks.

Bitcoin is not managed by a single bank or government like fiat currencies like the U.S. dollar or the British pound. Instead, software regulates the rules for its usage and distribution.

Someone going by the alias “Satoshi Nakamoto” established Bitcoin in 2008.

His exact identity has been kept hidden from the public eye. To this day, Satoshi Nakamoto’s identity remains unknown.

Such secrecy has created a near mythical status for Satoshi. “Bitcoin God” will be the moniker some will use to refer to him. Others will be content in referring to him as “CIA” or another 3-letter agency acronym of that ilk.

Yes, the Bitcoin God could be one man. But he could also be a collective, or acting in the name of a collective. Or in the name of God Himself, in true Terry A. Davis fashion. No one has a clue.

Known facts include that Satoshi Nakamoto released his white paper “Bitcoin: A Peer-to-Peer Electronic Cash System” on October 31, 2008, Halloween. Eerie.

It was a 12-page synopsis of Bitcoin’s genesis (not the “genesis block” – that only came in 2009). The white paper explained in detail how Bitcoin would come to function and gave a technical overview of the system.

A white paper is a document written by the developers of a cryptocurrency project to describe the project’s goals and the technology behind it.

Version 0.1 of the Bitcoin software was posted on an anonymous mailing list in early January 2009.

The software regulates the issuance and spending of bitcoins, and limits the total quantity to 21 million. To create new bitcoins, a technique known as “mining” is used. This process includes specialized computers participating in a game of guessing numbers; the “miner” who guesses the correct numbers first is awarded with bitcoins.

It is estimated that the final bitcoin will be “mined” in the year 2140, with approximately 19 million already having been generated.

Bitcoin’s restricted quantity is in contrast to central banks’ ability to print an infinite supply of fiat currencies like the U.S. dollar.

Bitcoin enthusiasts argue that the cryptocurrency’s worth stems from the fact that there is a finite supply of bitcoins.

Bitcoin’s creator, Satoshi Nakamoto, released the code for the cryptocurrency to the public and encouraged its further development.

When software is “open source,” the source code is made publicly available. The source code is easily accessible and can be altered by any programmer.

Like the Wikipedians who produce and edit articles for free, other software developers have contributed to and improved upon the original source code throughout time.

Satoshi Nakamoto emailed one of the programmers a short message that said, “Yo! I’m out! ✌️”

Truthfully, the message was more along the lines of “I’ve moved on to other things.” After then he vanished without a trace.

And as they say, the rest is history.

Much like Satoshi, who vanished from the scene. Forever.

Yep.

The Bitcoin community never heard from Satoshi Nakamoto again.

I have never been the recipient of a “ghosting,” but I’m sure some of you have and that it was a horrific experience.

But it’s okay, Bitcoin survived even after its inventor vanished.

Bitcoin has been around for over a decade, and it is still actively used for transactions between users all around the world.

Bitcoin’s first documented exchange rate occurred in October 2009. You may get 1,309 bitcoins for only $1. This was the moment the now-mythical “genesis block” was created. By none other than Satoshi himself.

Bitcoin didn’t become worth the same as one dollar until February 2011, at which point the exchange rate was $1 for one bitcoin.

Bitcoin’s value rose as the number of people willing to invest in it did.

Bitcoin’s value increased from $13 to $1,157 in 2013. The return was 8,800%!

Bitcoin, which began the year at $1,000 and nearly reached $20,000 before dropping severely, likely lost its reputation as a “underground” currency in 2017.

Bitcoin, however, has already established its resilience.

Over $68,000 was the all-time high price of bitcoin, which was reached in November 2021.

That Satoshi Nakamoto fella still has over a million bitcoins in his possession, which is insane. While the Bitcoin God may today be worth a fortune, financial gain wasn’t the motivation for developing Bitcoin.

The true motivations behind Bitcoin’s creation will be revealed in the following unit.