What are Bitcoin and cryptocurrencies?
To understand cryptocurrency, it’s best to start with the most popular and in many ways the simplest of these networks: Bitcoin Bitcoin is the world’s first completely decentralized, open-source, and peer-to-peer digital currency. A short decade ago, knowledge of it was confined to a handful of hobbyists on Internet forums. Today, the bitcoin economy is larger than the economies of some of the world’s smaller nations. The value of a bitcoin (or BTC) has grown and fluctuated greatly, pennies to many thousands of dollars. No Third Parties Until Bitcoin’s invention in 2008 by the unidentified programmer known as Satoshi Nakamoto, online transactions always required a trusted third-party intermediary. For example, if Alice wanted to send $100 to Bob over the Internet, she would have had to rely on a third-party service like PayPal or MasterCard. Intermediaries like PayPal keep a ledger of account holders’ balances. When Alice sends Bob $100, PayPal deducts the amount from her account ...