Bitcoin Knowledge Base

Bitcoin is a decentralized digital currency that enables peer-to-peer transactions without the need for a central authority or intermediary. It was created in 2009 by an anonymous person or group using the pseudonym Satoshi Nakamoto.

Bitcoin uses blockchain technology, a distributed ledger that records all transactions across a network of computers. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain.

You can buy Bitcoin through cryptocurrency exchanges, Bitcoin ATMs, peer-to-peer platforms, or by receiving it as payment. You'll need a Bitcoin wallet to store your Bitcoin after purchase.

Bitcoin's legal status varies by country. In most countries, Bitcoin is legal, but regulations differ. Some countries have banned it, while others have embraced it. It's important to check your local regulations.

Bitcoin is stored in digital wallets, which can be software-based (hot wallets) or hardware-based (cold wallets). Hardware wallets are considered more secure as they store private keys offline.

Bitcoin mining is the process by which new bitcoins are created and transactions are added to the blockchain. Miners use powerful computers to solve complex mathematical problems, and the first to solve a problem gets to add the next block to the blockchain and receive a reward.

While no investment is guaranteed, Bitcoin has shown remarkable resilience over its 15+ year history, surviving numerous market crashes, regulatory challenges, and technological concerns. Its decentralized nature, fixed supply, and growing adoption suggest it could persist long-term. However, like any asset, Bitcoin faces risks including regulatory changes, technological vulnerabilities, competition from other cryptocurrencies, or loss of trust. The possibility of collapse exists, but many believe Bitcoin's fundamentals make it increasingly resistant to complete failure as adoption grows.

Bitcoin has a hard-coded maximum supply of 21 million coins, which is built into its protocol by Satoshi Nakamoto. This limit cannot be changed without consensus from the network. The 21 million cap creates scarcity, similar to precious metals like gold. However, when people say "Bitcoin will go to 21 million," they're usually referring to the price or adoption reaching new heights, not the supply limit. The actual number of bitcoins will approach but never exactly reach 21 million due to the mathematics of the mining reward halving, with the final bitcoin expected to be mined around the year 2140.

The fundamental value proposition of Bitcoin rests on several key principles: decentralization (no single authority controls it), scarcity (fixed supply of 21 million coins), security (cryptographic proof secured by the blockchain), transparency (all transactions are publicly verifiable), programmability (can be used as programmable money), and portability (can be sent anywhere in the world quickly). Bitcoin fundamentally represents a trustless, peer-to-peer electronic cash system that operates independently of governments and financial institutions, making it resistant to censorship and inflation.