The Rise of Cryptocurrency
Five years ago, a mysterious figure known as Satoshi Nakamoto released a decentralized, open source, P2P system of currency upon the world. He called it Bitcoin.
Visual Capitalist, the purveyor of pictographic propaganda, has a great infographic titled the Definitive History of Bitcoin, which will give you a good overview of how the technology grew.
Bitcoins (designated by the unofficial currency code of BTC) are released to the world (awarded) at a fixed rate. Currently, 25BTC are issued every 10 minutes (150BTC per hour). This rate will be cut in half every four years until there are 21 Million BTC in circulation — which should happen sometime in 2040. As of this writing, there are 12,199,700 BTC circulating around the Internet.
In order to be awarded, Bitcoins need to be digitally “mined.” This is done by using the power of a computer’s CPU. These days, it’s very difficult to successfully mine as an individual. If you’re interested in mining, it’s advisable to join a pool, like Slush’s pool. Learn more about mining at the Beginner’s Guide to Mining Bitcoins.
Now, to be fair, there’s really no mining involved. Quartz, as part of a detailed explanation of how the whole process works, describes it as “competitive bookkeeping.” Which doesn’t really sound all that exciting, unless you’re a bookkeeper, perhaps.
Getting Started with Bitcoin
If you don’t want to get in on the mining action, you can still use bitcoins. All you really need to get started is a digital wallet where you’ll keep your stash. There are many different options, and WeUseCoins explains the differences in their short guide on getting started.
So you have some Bitcoins. Now what? The number of companies — both on the Internet and in the physical world; both legitimate and shady — who accept Bitcoins as a valid payment is steadily increasing. You can even buy gift cards with Bitcoins at Gyft.com. It’s worth noting that, like any base currency, bitcoins can be divided down into smaller amounts. Currently, the lowest denomination allowable is 8 decimal places or 0.00000001 BTC (a fraction of one U.S. cent).
And, of course, you can pay other individuals with Bitcoin. All you need is the unique address of their Bitcoin wallet. Here’s mine: 1HwzoEjs3YrgdnYgcxx6mhPkkPM3QUna4Z (Just in case you want to send some BTC my way.)
My Curated List of BitCoin Stories
It’s safe to say that I’m a bit fascinated with the cryptocurrency phenomenon. I’ve been curating a Readlist of stories about Bitcoin since May 2013. With more than 50 stories (and counting), it should give you more information about Bitcoin than you need.