7 Facts About Bitcoin You Should Know

Probably a vast majority of people these days have at least heard or are familiar with the term Bitcoin. It was and still is the most popular, valuable and recognised cryptocurrency in the world.

At the point of writing it trades around $3,600 and has a market cap of nearly $63 billion. But do you know everything about the cryptocurrency that at one point in time was valued at about $20,000?

Bitcoin was and still is the most popular, valuable and recognised cryptocurrency in the world.

I invite you to dive slightly deeper into BTC and take a look at 7 facts about Bitcoin you should know.

The first Bitcoin purchase was for pizza 

At the very beginning, when Bitcoins were mined they were almost worthless as it cost cents to buy one BTC. But it was only until 22 May 2010, when someone purchased something with Bitcoins. It changed, when someone bought Piazzas with Bitcoins and this purchase was quite a big deal since no retailer was accepting Bitcoins back then. On 22 May 2010, two Papa John’s Pizzas were exchanged by Laszlo Hanyecz for 10,000 BTC. This was the first official documented purchase of goods using Bitcoins. At that time, the worth of 10,000 BTC was around $40. At the time of writing this article, the worth of 10,000 BTC is around $36 million. Right now, May 22 is celebrated as Bitcoin Pizza Day.

The inventor of Bitcoin is a mystery

Yes, that’s correct! Nobody still knows who actually created Bitcoin. Since the inception of Bitcoin in 2009, there have been several speculations about who the father of Bitcoin is. The Bitcoin whitepaper was made open to the public under the pseudonym of Satoshi Nakamoto. The identity of “Satoshi” is still a mystery yet to be solved (if at all).

Dorian Satoshi Nakamoto, the 64-year-old man was earlier announced as the creator of Bitcoin. Yet, the man denied this from the very beginning and in his first interview immediately said “I am here to clear my name. I have nothing to do with Bitcoin, I was just an engineer”. 

Satoshi Nakomoto disappeared right after Gavin Andresen went to the CIA

Gavin Andresen was the former maintainer of the Bitcoin Core codebase. In June of 2012, Gavin went to the CIA’s headquarters to tell them about Bitcoin. According to Gavin on Bruce Wagner’s Bitcoin podcast, Satoshi’s vanishing may have been linked to the CIA meeting. Andresen said that he hadn’t received an email from Satoshi since notifying him about the meeting with the CIA. In 2014, Gavin appeared before the Council on Foreign Relations to present similar information.  

I am here to clear my name. I have nothing to do with Bitcoin, I was just an engineer (Dorian Satoshi Nakamoto)

The maximum number of Bitcoins isn’t really 21 million

In fact, it’s 20,999,987.4769 or somewhere around there. It’s expected that the last Bitcoin amount will be mined sometime between the years 2128 and 2140. The number is lower than the frequently-cited figure of 21m due to Satoshi’s block reward mechanism, which doesn’t quite reach 21 million, but also due to mining errors which have negated the creation of new coins. It’s possible that future errors will reduce total supply even further.

The earliest Bitcoin faucets distributed 5 BTC per visitor

In June of 2010, Gavin Andresen created the first Bitcoin faucet to disperse 5 free Bitcoins per day to anyone who desired them. At the time, BTC was worth very little and the faucet was funded with well over 1,000 BTC. Based on the current price, it’s crazy to think how much value was given away for free.

Bitcoin is not created out of thin air

Bitcoin is created through a process called mining. Blockchain, the technology that Bitcoin is built on top of, is dependent on a network of nodes that guarantees the integrity of transaction history by achieving consensus (to understand more about Blockchain, you can reference this article.) Validation is one part of the process. After validating a transaction, the nodes then need to compete and race, using trial and error, to solve a difficult mathematical puzzle that requires substantial computing resources. The first computer in the network that solves the equation will be rewarded with Bitcoins. This is known as the process called mining Bitcoin. This protocol is referred to as Proof of Work (PoW).

Bitcoin mining serves two purposes: it allows for the creation of new coins and facilitates the processing of transactions in the network. Mining requires energy, hardware and bandwidth. If you try to mine Bitcoins on your computer, you will find the cost of electricity likely outweigh the value of Bitcoins you can mine. Other cryptocurrencies also use PoW. Another emerging protocol is Proof of Stake (PoS) which does not need energy or hardware to achieve consensus, but rather uses staking or bonding tokens to determine the next block. 

Losing a Bitcoin wallet means losing those Bitcoins

Just like you save your money in your online bank accounts, your Bitcoins are saved in a Bitcoin wallet. It’s a highly secure storage wallet. But, if you lose it, your Bitcoins are lost forever.

Did you know all of these facts? Which one’s your favorite? Or maybe you have something to add to the list?

Share your thoughts in the comments below.

P.S. You might enjoy my earlier pieces as well:

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About: I am a business developer, sales professional, FinTech strategist, as well as Cryptocurrency and Blockchain enthusiast. I'm highly passionate about Financial Technology and Digital Innovation, and strongly believe that it will change the world for the better. Apart from my daily job at one of the leading alternative banking and payments providers in EEA, I'm an active member of FinTech community and a TechFin evangelist.

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