Bitcoin from the Beginning
An overview of Bitcoin to get you up to speed.
What is Bitcoin?
“We define an electronic coin as a chain of digital signatures.” - Satoshi Nakamoto
With those words, Satoshi Nakamoto defined Bitcoin, and a new technology began to slowly change finance as we know it. You've likely heard of Bitcoin, however, if you still don’t understand it, you are not alone. In fact, as of February 2021, 61% of Americans said they had little to no understanding of how it or some of its crypto cousins worked. That’s where we step in, we will be providing you with this newsletter to keep you up to date on all things happening in the world of crypto from the ground up.
Bitcoin carved the way for peer-to-peer digital currencies to explode to $2 trillion dollars. How is Bitcoin different, and how does it work?
How does it work?
Bitcoin, at its most basic level, is a ledger system. It is unique because there is no middleman (bank, country, etc) to verify these transactions. Anyone can take part in the ledger verification process through a process called “Bitcoin Mining”.
The miners contribute computing power to validate the ledger and the transactions that occur on the network. Because this process is resource-intensive, mainly from electricity usage, the bitcoin network is coded to reward its miners with a small amount of bitcoin per day to make mining profitable. It’s a carefully designed system to keep users, holders of bitcoin, and miners happy and all working together.
Some key stats:
There is a hard-capped supply, there will only ever be 21 million Bitcoins, and 18.7 million are already in circulation.
The Bitcoin network is incredibly difficult to hack. No one entity runs it. In fact, the only way to pull a hack off would be to “buy out” the network, which is prohibitively expensive.
The supply rate of Bitcoin becomes more scarce over time.
In just 10 minutes, you can send any value in Bitcoin to anyone in the world at any time.
Digital Gold
Because of this scarcity and security built-in, we and many experts relate Bitcoin to another widely held “alternative” asset, gold. However, Bitcoin is more fungible, easier to store and transact with than gold, has more use cases, and is scarcer, making it a superior store of wealth. Like gold, many companies are beginning to hold Bitcoin on their balance sheets.
Bitcoin Resources:
The original Bitcoin whitepaper was written by Satoshi Nakamoto laying out a peer-to-peer electronic cash system in 9 simple pages. Or here's a guide for people without an advanced computer degree.
CoinDesk, a leader in crypto-related news, breaks Bitcoin down into an easily digestible article: what it is, how to buy and sell, and why to get involved.
"So I'm still confused...what the heck is a Bitcoin??" This explains Bitcoin to a 5-year-old.
For a very deep dive into Bitcoin and the future of the currency, read this bullish study.
About FirstWatch Crypto
Every ship needs someone keeping watch. We are the first watch. The tireless observers constantly on duty and essential to the ship's safety. FirstWatch Crypto is inspired by this constant vigilance. We are braving the waters together, helping guide your investments through the complex sea of change of cryptocurrencies. The development of these financial technologies has brought with it a sea of change to finance, one we think is a new world. FirstWatch Crypto brings knowledge of and passion for the future of finance and cryptocurrencies. We want to help you achieve a better future by making crypto easy and accessible for you. We will keep the first watch.
Our Values: Education, Cutting Edge, Competition
Educating investors on the fundamentals of the revolutionary new asset class of cryptocurrencies.
Positioning ourselves at the cutting edge of finance and (blockchain) technology.
Providing a platform to serve as an introduction to digital currency and using industry best practices to stay ahead.
Disclaimer: None of the above is investment advice. This blog is published for entertainment and informational purposes only. The ideas expressed are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. Nothing on this blog constitutes investment advice, performance data, or any recommendation that any security, portfolio of securities, investment product, transaction, or investment strategy is suitable for any specific person. You should not use this blog to make financial decisions. We highly recommended you seek professional advice from someone who is authorized to provide investment advice. You should always do your own research before investing in cryptocurrencies. It is a volatile market.