Bitcoin (₿) is a decentralized virtual currency, without a central financial institution or single administrator, that can be sent from consumer to user on the peer-to-peer bitcoin community without intermediaries. Through cryptography, transactions are proven via network nodes and recorded in a public distributed ledger known as a blockchain. The cryptocurrency was invented in 2008 via an unknown person or organization of people using the name Satoshi Nakamoto. The currency commenced use in 2009 while its implementation was launched as open-source software.
Bitcoins are created as a reward for a method called mining and can be exchanged for other currencies, merchandise, and services. Bitcoin has been criticized for its use in illegal transactions, the significant amount of electricity (and thus carbon footprint) used by mining, fee volatility, and thefts from exchanges. Some people have characterized it as a speculative bubble, and others have used it as funding, even though several regulatory businesses have issued investor indicators about bitcoin.
A few local and national governments are officially using bitcoin in some ability, with one country, El Salvador, adopting it as a legal tender.
The bitcoin was described in a white paper posted on 31 October 2008.
The Bitcoin blockchain is a public ledger that collects bitcoin transactions—applied as a chain of blocks, each block containing a hash of the previous block up to the genesis block in the chain. A network of communicating nodes running bitcoin software keeps the blockchain. Transactions of the shape payer X sending Y bitcoins to payee Z are broadcast to this community using effectively available software programs.
Network nodes can validate transactions, upload them to their reproduction of the ledger, and then broadcast these ledger additions to other nodes. At various periods of time-averaging to every 10 minutes, a new group of standard transactions, known as a block, is created, delivered to the blockchain, and quickly posted to all nodes without requiring central oversight. It permits bitcoin software to determine when a particular bitcoin was spent, needed to prevent double-spending. A traditional ledger records the transfers of accurate payments or promissory notes that exist aside from it. Still, the blockchain is the only place where bitcoins can be said to live in the shape of unspent outputs of transactions.