Think of Bitcoin as a digital currency but trackable and not centralized or depending on anybody to work as intended, Bitcoin is created, distributed, traded, and stored with the use of a decentralized ledger system, known as a Blockchain.
Bitcoin uses the peer-to-peer (P2P) concept to operate with no central server, authority, or bank managing transactions. The issuing and distribution of Bitcoins is carried out collectively by the network and they’re made public.
Created in 2009 by an unknown person using the alias Satoshi Nakamoto, Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part. Through many of its unique properties, Bitcoin allows exciting uses that could not be covered by any previous payment system.
What Is Bitcoin Mining?
Bitcoin mining is the process by which new bitcoins are released into circulation and it is also a critical component of the maintenance and development of the Blockchain ledger. It is performed using very sophisticated computers that solve extremely complex computational math (puzzles) problems to create a new block.
The Bitcoin reward that miners receive is an incentive that motivates people to assist in the primary purpose of mining: to legitimize and monitor Bitcoin transactions, ensuring their validity. Because these responsibilities are spread among many users all over the world, Bitcoin is a “decentralized” cryptocurrency or one that does not rely on any central authority like a central bank or government to oversee its regulation.