bitcoin

a.k.a. bit coin, Bitcoin, cryptocurrency, crypto-currency, digital cash, digital currency, virtual cash, virtual currency

Bitcoin is the name for a digital currency based on an open source peer-to-peer Internet protocol.

Bitcoin is not managed like other currencies: it is decentralized and therefore has no central bank or organization. Instead, it relies on an Internet-based, peer-to-peer network. The money supply is automated and given to servers or bitcoin miners that confirm bitcoin transactions as they add them to a decentralized and archived transaction log approximately every 10 minutes.

Bitcoins are exchanged through a computer or smart phone locally or internationally without an intermediate financial institution. Introduced in 2009 by Satoshi Nakamoto, one bitcoin is subdivided into 100 million smaller units called satoshis (defined by eight decimal places).

For a technical description of how the authentication by end-users using digital signature algorithms works, please use the Search link below.

Historical perspective: Invented in 2009 as a form of virtual cash used to buy goods and services online anonymously, bitcoin became bigger than anyone expected. Bitcoin was invented by an unknown person or group of people using the name Satoshi Nakamoto and released as open source software. At first glance, it may seem like a terrible idea or even a recipe for disaster. In essence, it is a totally decentralized currency without a central authority, where semi-anonymous parties exchange meaningless tokens. Bitcoin relies largely on trust, something that’s hard to earn and an easy thing to squander. Usually it’s up to governments to create value from nothing, but obviously, it doesn’t always work. Look at the country Cyprus, where a failed banking system caused an entire country to realize that the value of their deposits, the fundamental integrity of their financial selves, was arbitrary all along. Virtual currencies like bitcoin may be just the solution for people who have lost faith in real-world institutions. Bitcoin may look like a hilarious parody on our shaky global economy. But as a currency for the disenfranchised and distrustful, it’s as serious as can be.

As of April 2013, the monetary base of bitcoin was valued at over $2 billion USD. However, the large fluctuations in the dollar value of bitcoin has evoked criticism of bitcoin's economic suitability and legitimacy as a currency. Bitcoin is considered the most widely used alternative currency and is accepted by various merchants and services around the world.

In mid-2017, bitcoin achieved a symbolic milestone: For the first time, a single unit of the digital currency became worth more than an ounce of gold, then about $1,200.

In late-2017 through 2018, "a bitcoin boom" took place. In Wenatchee, WA, a bitcoin invasion was underway, according to The Wall Street Journal. Home to hydroelectric dams that harness the power of the Columbia River, the small town of 34,000 boasts some of the cheapest power in the U.S. That’s prompted an influx of bitcoin mining operations, which require vast amounts of electricity to run the thousands of computers needed to mine the digital currency. After the 1,300 percent surge in bitcoin prices, Wenatchee and nearby counties were inundated with at least 30 bitcoin startups. Some have requested power service exceeding 100 megawatts each, enough power for more than 50 hospitals. Some residents hope the influx will transform Wenatchee into a new economy hotspot; others worry about a bitcoin bubble.

In 2018 the word "bitcoin" was added to Merriam-Webster's unabridged dictionary. - As seen in The Week

NetLingo Classification: Online Business

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