The Brief History of Bitcoin

Bitcoin was invented in 2008 when he published an article titled “Bitcoin: A Peer-to-Peer Electronic Cash System”. Nakamoto combined several previous inventions, such as b-money and HashCash, to create a fully decentralized electronic cash system that does not rely on a central authority to issue currency or reconcile and confirm transactions.

The key innovation is the use of a distributed computing system (called a "proof-of-work" algorithm) to make a global "selection" every 10 minutes, enabling the decentralized network to reach consensus on the state of transactions.

It elegantly solves the double-spend problem, where a currency can be spent twice. Previously, the double-spending problem, a weakness of digital currencies, was solved by clearing all transactions through a central clearinghouse.

The Bitcoin network started in 2009 based on a recommended implementation published by Nakamoto, which has since been reviewed by many other programmers. The ability to implement the proof-of-work (mining) algorithm that provides Bitcoin with security and flexibility has grown exponentially and now exceeds the combined processing power of the world’s best supercomputers.

The total market capitalization of Bitcoin sometimes exceeds $35 billion, depending on the exchange rate of Bitcoin against the U.S. dollar.

The network handles a maximum transaction value of $150 million, which is shipped immediately and processed for free.

Satoshi Nakamoto retired from public view in April 2011, leaving the responsibility for code and web development to a thriving group of volunteers. The identity of the person behind Bitcoin remains unknown. However, neither Satoshi Nakamoto nor anyone else has personal control over the Bitcoin system, which operates based on fully transparent mathematics, open source code, and consensus among participants. The invention itself is groundbreaking and has already spawned new sciences in the fields of distributed computing, economics, and econometrics.