BTC is peer-to-peer digital electronic cash created for multi purpose use. It’s first digital cryptocurrency which works in decentralized manner (without any central banks or administrators) and is the first on the capitalization amount counting almost $141 bln dollars.
So, how it was invented? Bitcoin was created in 2008 by Satoshi Nakamoto and in 2009 he has mined the first block in the blockchain. The blockchain is a public ledger on which the whole Bitcoin system relies. It’s encrypting users data and make the whole system trustless and decentralized.
Blockchain works as a public ledger with a chain of blocks, each block containing a hash of the previous block up to the genesis block of the chain. The blockchain is secured from double spending and attackers, who would like to make a fraud branch of blocks in the blockchain.
Instead of government structures that decided what amount of currency should be circulated, in cryptocurrency there is no centralization or administrators, blockchain programming handles to scale the amount of BTC, mining difficulty and amount that is needed to be circulated on markets.
Bitcoin is maintained by a group of volunteer coders. It is run through an open network of supercomputers that are spread all over the world. Bitcoin is often an attractive prospect for people who don’t like the kind of government control and regulation that is associated with traditional currencies.
Fiat currencies such as the Dollar, Euro, and others have an unlimited supply. Central banks that control and regulate the currencies may decide to issue as many fiat currencies as they want and manipulate their values against each other.
Since there is no central agency that can validate Bitcoin transactions used in smart contracts, users can send and receive coins without the risk of revealing their identities. When a user submits a transaction request, the protocol simply checks all the previous transactions associated with the sender to see whether he or she has enough coins to complete the transaction.
Unlike the electronic fiat transactions, transactions involving Bitcoin cannot be reversed. This is simply because there is no way to do so. Fiat transactions will often have a mediation process where someone can seek redress in case they want a payment reversed. As for Bitcoin, once the transaction is recorded in the network and one hour has passed, then there is no way of reversing it. Although this might be a concern to some people, it is a clear
Miners are volunteers that constantly using processing powers to find new blocks and help to develop Bitcoin blockchain. For each new block, they receive a reward in Bitcoin, which for now is 12,5 BTC. And they also receive payments for transaction verification.