Top 10 Facts You Didn’t Know About Bitcoin

10 Facts About Bitcoin And How It Will Change The World

If in 2012, 1 Bitcoin cost about $5-10 then in 2017 people were about to pay over $20,000 for one crypto coin. What people pay a whole lot of money for currency that even cannot be kept in hands?

Maybe they know something others don’t even have a clue?

There is more in this than meets the eye as some experts believe that it’s strongly recommended to use VPNs for Bitcoin otherwise they can be stolen.

Others say that this digital currency is protected against hacking attacks.

But what puts people on to change real money into digital?

Read this post and know some facts that can change your attitude towards this digital currency.

What’s Bitcoin for short?

The cryptocurrency concept was introduced by Wei Dai in 1998. He launched a mailout with the idea to create a new form of money. The key point was the following: cryptography would be used to monitor emission and transaction instead of the central operating agency.

In 2008, Satoshi Nakamoto proved the viability of the concept through his mailout, and a year later he submitted Bitcoin to the public approval.

Fact #1: The 22nd of May is Bitcoin Pizza Day.

This date is a historic day in the Bitcoin industry. Eight years ago, in 2010, programmer Laszlo Hanyecz bought 2 pizzas in Papa Jhon’s and paid 10 000 Bitcoin (about $25 dollars in those times). Of course, it was lunch money.  

Could you imagine how much would it be in dollars today?

It would be about $40, 050, 100.

Traditionally, on this day the representatives of Bitcoin community think of this event that gave rise to cryptocurrency transaction (actually, it was the first Bitcoin transaction in the world).

It goes without saying that pizza restaurants don’t accept alternative methods of payment. But Laszlo found a person who would buy 2 pizzas for him the Bitcoin Talk forum.

A human personality of the programmer’s mediator is unknown. But it is conceivable that this man has his/her bread buttered for life in case he/she hasn’t cashed Bitcoins.

Fact #2: BTC mysterious creator

In 2008 an unknown user or a group of people (nobody exactly knows) under an alias of Satoshi Nakamoto published a report on a forum. He described the principles of a Bitcoin-network operation. The text was comprehensible even for an average user.

Everybody knows what has happened next. Nevertheless, people don’t know for sure who or what is Satoshi Nakamoto as there is no person in the world that would say that he or she saw Satoshi.

Perhaps, the Bitcoin developers thought that anonymity would help to attract attention to the project. Actually, a genuinely decentralized currency should not be under the control of one leader that would destroy the system at his / her own wish. And finally, they came up trumps.

This type of currency is not under the control of governments of any country. Moreover, it is very easy to hide the transaction from third parties due to the emoticons or pictures.

One way or another, whoever Satoshi Nakamoto is, he, she or they are men of genius.

Fact #3: 21 million is ultimate for Bitcoin

In contrast to common money that can be minted in unlimited quantities (and as a result monetary depreciation can take place), the number of Bitcoins is limited up to 21 million units. The explanation of this fact is simple – the developers specified this figure in the protocol and the program code.

According to the protocol, a miner is rewarded with the digital coins when a new transaction block is added to the Blockchain. In the very beginning, the commission was 50 BTC (coins).

However, the sum is reduced by half once per 210 000 transactions. It is easy to predict when the last BTC will be obtained due to a math formula:

N + N/2 + N/4 + N/8 + N/16 + N/32 + … + N/2^k

It is estimated that the last Bitcoin will be mined in the year 2140.

Today, about 80% of Bitcoins are obtained, which leads to the crypto exchange deficit. It makes the price rise.

The number of Bitcoins will drop below the figure of 21 million. It is inherent to the fact that some users forget the key that allows accessing BTC wallet. Therewith access to Bitcoins is lost as well.

Nowadays, there are over 3000 Bitcoin automatic teller machines. One large scale, they are located in the USA, Canada, and Europe.

Have you ever seen one of them?

Fact #4: BTC is a way-out for the backward countries

Banking services for us are routine practice. Some people visit banks to pay for services, others prefer staying at home and do transactions with the help of a smartphone or a laptop. And Internet banking is a great helper in this issue.

However, about 2 billion people of the Earth are not familiar with it in view of the lack of bank offices. Ghana is an example of a place where people cannot have fingers in the global economy’s pie.

But iPhone X is a common thing there. Smartphones would help them to do transactions without any troubles. The only thing one is to think beforehand is how to protect a smartphone against unauthorized invasions.

Thus, smartphones in combination with Bitcoins can become a good alternative to banking services. It is estimated that the number of smart gadgets will reach the figure of 6.1 billion by 2020.

It is highly likely that new generation will prefer Bitcoin to Bank of America, for example.

Fact #5: Bitcoins DO exist

Although we got used to thinking that BTC is purely non-substantial, in actual fact, it is not so. The Casascius Bitcoin Mint company put real BTC coins of 0.1, 0.5, 1, 5, 10, and 25 value into circulation. Technically, the coins functioned as ”independent wallets”.

Such coins contained unique data – Bitcoin address and a secret key (hidden by dint of a one-time holographic recording.

BTC coins were made of lattin and gold, which lent importance to this digital currency.

Unfortunately, there are people who took hold of this idea and created fake coins to make a profit out of them.  

Such cases made people remain wary of BTC and blockchain. For instance, Warren Buffet recons that people should steer clear of Bitcoin because this currency is the illusion.

Fact #6: Bitcoins appear on tax returns

It is not a secret that anyone can become a miner of this cryptocurrency. There is a short list of thing one has to possess to become a BTC-maker:

  • wallet for cryptocurrency;
  • equipment (such as PC);
  • software for mining.

That is why people around the world start mining Bitcoins on their home computers. Thanks to such Bitcoin farms, they make good money. In such a way, 802 in the United States of America listed Bitcoin mining as a source of income in 2015. Two years later this index increased by 1400%!

Despite the fact that the number of Bitcoin farms grows at an exponential rate, they are rarely used to pay for services or goods. Less briefly, 36% of BTC coins haven’t been used yet.  

It can be explained by the people’s intention to wait until this cryptocurrency would reach its highest price.

For example, Kristoffer Koch paid $27 for BTC and… forgot about it for several years. When he thought back, his investment brought him $886 000.

Fact #7: Transactions with Bitcoins are anonymous

The maximum number of Bitcoin transactions per 1 second is 7. However, in reality, 3-4 Bitcoin transactions take place per second whereas Visa makes about 2000 transactions per second (50 000 is maximum).

These data indicate that the Bitcoin network is absolutely unfit for making payments.

At the same time, it has a great advantage. When a person makes a BTC transaction, his or her name is not used in any form. Only IP of a person is known and therefore unprotected. However, there are several ways to hide IP address.

But…

Bitcoin-blockchain is a standard ledger. If someone knows your public Bitcoin address, this person is aware of how many BTC are in a wallet and what transaction has been done.

The FBI case proves this idea. IP address helped it to find the owner of the Silk Road website (it was focused on illegal things and services selling) and stop its criminal activity floating around the Internet.

Thus, it should be pointed out that Bitcoin transactions are only partially anonymous. It determines the fact that refund while paying with BTC is impossible (even when thousands of Bitcoins are sent by mistake)

Nevertheless, many people find this type of payment rather beneficial and keep on using it.

Fact #8: Bitcoin will NEVER be prohibited

In view of Bitcoin character, there are a lot of rumors about the Bitcoin disabling. Such a hostile attitude towards bitcoin is determined by the fact that it is out of the jurisdiction of the traditional core banking system.

However, the takeaway is that it cannot be forbidden. Until you have access to the Internet and Bitcoin wallet, you can use it.

Nevertheless, many countries undertook attempts to forbid it. Among such countries, one could find Bangladesh, Bolivia, Thailand, and Vietnam.

At the same time, Bitcoin is determined as an official legal currency that undergoes regulation in Australia, Russia, Japan, and Venezuela. What is more, at the beginning of 2018 the Russian Federation has signed the law that determines the legal status of cryptocurrency.  

Fact #9: Mining as heat-assistance

Any person engaged in mining Bitcoins is to take a decision on how to use the heat generated while mining. Some resourceful users reckon that this heat can be used to provide private premises with warmth.

Implementation of this idea is observed in a Canadian company Myera Group. It used cryptocurrency farms for greenhouses heating.

It is no wonder that Bitcoin farms produce so much heat as the power requirement is enormous. For the last 24 hours, the gross energy for mining was 64.2 GWh. Thus, the share of electricity spent on mining is about 1%.

Compared with the beginning of the year, the number of miners increased by 122%, in its turn, it influenced the increase of power-consuming.

Fact #10: Bitcoin faced criticism

It is extremely interesting that the society took a dim view of Bitcoin perspective. Thought leaders across the financial landscape declared that the Bitcoin rate would fall and the whole network wouldn’t gain popularity.

In reality, the situation is polar opposite. In the course of the first five years, the Bitcoin price grew from $0 up to $1000. The Bitcoin system has been developing for 10 years already.

And this story is not yet over.

Summary:

Needless to say, there are even more interesting facts we could highlight in this article. During its history, the price of BTC changed not once: from $0.04 to $20 000. However, the price undergoes regular changing. And not any analyst can predict what will happen to BTC next year.

The era of Bitcoin is only at the beginning of its long way, therefore the number of captivating and exciting facts will appear. A lot of ups and downs is expected, but the interest in this type of cryptocurrency is permanent.

And who knows, maybe you can add some interesting facts about Bitcoin or become a part of its history?

Anyway, that remains to be seen.

For now, you can view our official bitcoin documentary list for more great films.

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