The term bitcoin originated from two words blended into one, bit and coin. Thus, Bitcoin is a peer-to-peer payment system (P2P) and a currency (BTC) at the same time. To secure transactions and work with bitcoin, cryptography methods are used. That is why another term was invented - cryptocurrency.

How did bitcoin appear?

In 2008, an unknown programmer working under the fictitious name Satoshi Nakamoto sent a file to a mailing list of crypto enthusiasts, which contained a description of the unique protocol and the principle of operation of the new P2P payment system. Nakamoto has been pursuing the idea of creating bitcoin for more than a year. However, the implementation of bitcoin as open source software occurred only two years later in 2009.

Miners keep the blockchains. Nevertheless, any significant change can only be made with consideration and under the close attention of mining pools.

For the first time, a physical purchase involving bitcoin was made by an American programmer from Florida, Laszlo Hanyecz, in the spring of 2010. He ordered two pizzas, which cost him a total of 10,000 bitcoins.

Circulation

Usually, bitcoins are used as an alternative to fiat money to buy goods and services online. However, digital currencies are not accepted everywhere. In addition, cryptocurrency can be exchanged for traditional money with the help of the appropriate payment systems and exchange offices.

Importantly, there is an additional commission for a bitcoin exchange transaction, which is set by the sender. Miners are given the right to choose the transactions that they will process. Therefore, they can give priority to the transactions with the higher commission. The Bitcoin client software offers the optimal amount of commission. All transactions involving bitcoin are non-convertible. Online payment takes place without the participation of any intermediary organizations.

Currently, the BTC/USD pair is the most popular, widespread, and frequently used tool for working with bitcoin. From the very beginning, the cryptocurrency exchange rate turned out to be extremely volatile. Usually, it depends directly on the level of general demand for the cryptocurrency, as well as on the total number of organizations that currently accept bitcoin as a means of payment or exchange.