What is Bitcoin?
Bitcoin as a technology solves many problems, and as open-source software, it continues to evolve in feature set while maintaining the core competencies of Bitcoin and the blockchain. Therefore, below is an ever growing list of short definitions for what is Bitcoin with longer pieces to describe them in more detail. The list is in no specific order.
List of Short Definitions of What is Bitcoin
Bitcoin is distributed. The full public ledger is a list of every Bitcoin transaction is available on computers all around the world, and not just located in one central database.
Bitcoin is decentralized. Bitcoin to be decentralized automatically assumes it is also distributed. Being decentralized means the Bitcoin code is publicly available to any computer around the world, specifically not limited to a single person or organization.
Bitcoin is a digital currency. There’s a growing consensus that each digital Bitcoin carries a currency value. Each Bitcoins is stored on the Bitcoin blockchain and can be accessed to view and transact with a digital wallet.
Bitcoin is immutable. This means once a block of Bitcoin transactions have been added to the Bitcoin ledger, it cannot be changed.
Bitcoin is transparent:. The Bitcoin ledger that contains all transactions is available to anyone with access to a full node.
Bitcoin is trustless: Means you don’t need to trust a third party such as a bank or any other middleman to either complete a transaction or to hold your bitcoin.
Bitcoin is a cryptocurrency. Meaning transactions are based on cryptographic proof rather than trust.
Bitcoin is open-sourced. No organization owns it, but anyone can contribute to the Bitcoin code. An open-source nature also implies Bitcoin is publicly available to anyone at the Bitcoin Github page.
Bitcoin is capped at 21 million. The code ensures that only 21 million bitcoins will ever be created. The last Bitcoin will be minted in year 2140. Note that because Bitcoin is software, it’s programmatically possible to increase the number of Bitcoins, but it would require network-wide consensus for the changes to be accepted.
Bitcoin is global. Bitcoin runs completely over the internet which means anyone with an internet connection and store and transact Bitcoin.
Bitcoin is peer-to-peer. This means transactions happen between two peers. The middlemen such as banks are not necessary in storing or transacting Bitcoin.
Bitcoin was created by Satoshi Nakamoto. Most likely a pseudo name for a person or group who developed the initial bitcoin code and whitepaper “Bitcoin: A Peer-to-Peer Electronic Cash System”.
Bitcoin is a blockchain. A blockchain is the method of storing information where the data is queued up into a “block”. When the “block” is filled, it is cryptographically added to the blockchain where the “block” becomes impossible to change without updating all future blocks. Note that Bitcoin is an implementation of a blockchain, but blockchain is not Bitcoin. More about Bitcoin vs Blockchain.
Bitcoin is evolving. As it is with any technology, Bitcoin is always evolving to include enhancements and new features. In Nov 2011, the feature Taproot features went live in Nov 2021!
Bitcoin is secure. Since Bitcoin is built on a a blockchain that is both decentralized and open source.
Bitcoin is honest. Without the influence of government, Bitcoin resists the greed to print fiat money.
Bitcoin is base layer (level one). This means it’s the main network that bitcoin operates. Other applications have and will continue to be developed using Bitcoin.
Future Work to the List
As Bitcoin continues to evolve, this document will continually updated to reflect the changing nature of technology. Feel free to leave your opinions on “What is Bitcoin?” in the comments (and the good one will be integrated)