Bitcoin: The First Successful Virtual Currency

Written by on April 18, 2013 in Money - No comments | Print this page

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In 2009, Satoshi Nakamoto introduced the bitcoin, a digital currency. No one knows much about him – or them – outside of his contribution to online money, but most agree that the bitcoin is a stroke of pure genius.

When it comes to the world’s currencies, there are two things all have in common. Each has a real value – like a gold standard – that the money represents and each is backed up by a government agency. Bitcoin is a bit different as the online currency is not controlled by an agency. Internet insiders have attempted to create such a currency for a long time, but it was always difficult to predict how an uncontrolled currency would perform.

Rather than gold, bitcoin’s worth is established by code. At its core, bitcoin is an encrypted string of data encoded to represent one unit of currency. Transactions made with the currency are tracked by a peer-to-peer network, completely free of governmental oversight, which is how bitcoin obtains its value.

Source: Bitcoin 101

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