I've been reading up on bitcoin lately and I'm super pumped up by the ideals it advocates for - economic freedom (A new kind of money that is fair and open).
Some things which I found particularly fascinating:
- "One money for the whole world". Shouldn't we all measure value the same way no matter where we live?
- Protects against inflation - only 21 million bitcoin will ever exist. ( what happens if there are so many people that it isn't sufficient? )
- It's in our hands and we control it. No 3rd party banks.
- Private keys are used to identify us. No other identification like name, phone or address required.
- It's keeping money safe for the future.(talking about decades - currently lot of spikes due to uncertanity)
- It doesn't exist physically. It's virtual.
- Bitcoin is designed for everyone.
- Bitcoin has a lot of potential - invented just 12 years ago.
- New digital currency for the whole world that is universally accessible and politically neutral.
Each bitcoin can be subdivided into 100 million units, each called a "satoshi" (singular) or "satoshis" (plural).
- Can I trust that the money is authentic and not counterfeit?
- Can I trust that the digital money can only be spent once (known as the “double-spend” problem)?
- Can I be sure that no one else can claim this money belongs to them and not me?
Satoshi Nakamoto combined prior inventions like b-money and HashCash to create a completely decentralized electronic cash system that does not rely on a central authority for currency issuance or settlement and validation of transactions. He used a distributed computation system (called a "Proof-of-Work" algorithm) to conduct a global "election" every 10 minutes, allowing the decentralized network to arrive at consensus about the state of transactions. This elegantly solves the issue of double-spend where a single currency unit can be spent twice.
- bitcoin wallet: bitcoin system :: web browser : HTTP protocol
- just like we have many web browser brands like Safari, Firefox we also have various bitcoin wallets.
- bitcoin wallets(based on platform) - desktop, mobile, web, hardware, paper
- bitcoin wallets provide a mnemonic phrase(12-24 English words) which are selected randomly by the software, and used as the basis for the keys that are generated by the wallet. They are used to restore all the transactions and funds in the wallet in the case of a lost mobile device, a software bug, or memory corruption.
Mastering Bitcoin by Andreas M. Antonopoulos - an absolutely thrilling beginner friendly book. I've incorporated material from the 1st chapter in the book here.