Bitcoin is a cryptocurrency and a global payment system that can be compared to other currencies such as the dollar or the euro, but with several basic differences, the most prominent of which is that this currency is a fully electronic currency that trades on the Internet only without a physical presence. It is the first decentralized digital currency – it is a system that works without a central warehouse or a single manager, that is, it differs from traditional currencies by the absence of a central regulatory body behind it. Transactions take place over a peer-to-peer network between users directly, without an intermediary, through the use of encryption. These transactions are verified by network nodes and recorded in a general distributed ledger called the blockchain. Bitcoin was invented by an unknown person or group of people known as Satoshi Nakamoto and released as open source software in 2009.
Bitcoin is created as a reward for a process known as mining. It can be exchanged for other currencies, products and services. As of February 2015, more than 100,000 merchants and sellers had approved Bitcoin as their payment currency. Research produced by the University of Cambridge estimates that in 2017, there were between 2.9 and 5.8 million users using a cryptocurrency wallet, and most of them were using bitcoin.
A person who called himself the codename Satoshi Nakamoto first proposed the idea of Bitcoin in a research paper in 2008, describing it as an electronic cash system that relies on peer-to-peer, a technical term meaning direct dealing Between one user and another without an intermediary (such as torrent). Bitcoins say the goal of this currency, which was first introduced in 2009, is to change the global economy in the same way that the web changed publishing methods. And in 2016 Australian businessman Craig Wright declared that he was Satoshi Nakamoto, providing technical evidence for this, but his evidence was easily debunked.
Bitcoin is considered a cryptocurrency, meaning that it relies mainly on the principles of encryption in all its aspects, and it is also considered the first currency of its kind and the most famous and widespread, but despite this it is not the only cryptocurrency on the Internet today. Where there are more than 60 different cryptocurrencies, including 6 currencies that can be described as the main, depending on the number of users and the structure of each network, in addition to the places where these cryptocurrencies can be exchanged and purchased in exchange for other currencies. All current cryptocurrencies are based on the principle of the Bitcoin currency itself, with the exception of the Ripple coin, and since Bitcoin is open source, it is possible to clone it, make some modifications, and then launch a new currency.
Bitcoin is an anonymous digital currency, as the transfer process through it requires only knowing the wallet number of the person to whom it is transferred, and the transfer process is stored in the blockchain with a special serial number and this does not include the name of the sender or recipient or any other data of their own, which makes it a popular idea for each Both privacy advocates, or online sellers of illegal goods (such as drugs).
Bitcoin is based on financial transactions and uses the peer-to-peer network, electronic signature and encryption between two people directly without an intermediary body organizing these transactions, as the money goes from one user account to another instantly and without any transfer fees (except for Network fees that are paid to miners) and without going through any banks or any intermediary bodies of any kind.
The currency is available worldwide and you don’t need to have any complicated requirements or things to use it. When you obtain the currency, it is stored in an electronic wallet. It is possible to use this currency in many things, including buying books, gifts or things available for purchase through the Internet and converting them to other currencies such as the dollar or the euro.
To ensure the correctness of the transfers, the Bitcoin system maintains a register of accounts in which all actions that take place on the network are recorded, called the block chain. All nodes on the Bitcoin network share this record through a system based on the Bitcoin protocol. The blockchain contains all the actions that were performed with Bitconn, which enables you to know the balance that each address on this network has. This concept is called the chain description of the interconnectedness between the blocks, as each block contains the hash of the preceding block, and the matter continues until the first block is reached, which is called the “genesis block”. Configuring the chain in this way makes the task of changing any block after a certain period of time has passed since its creation very difficult, as changing any block requires changing all the next blocks due to the need to recalculate the hash of each block to update the hash value of the previous block. This characteristic is what makes the problem of repeated spending of the same coins so difficult to Tekken, and the blockchain can even be considered the backbone from which a currency cannot stand without it.
Bitcoin has a high level of secrecy. In principle, this is true, as all you need to send some bitcoins to someone else is their address. But by virtue of the fact that every transfer is recorded in the Bitcoin register, although you do not know the identity of the owner of any address, you can know how many bitcoins he has and what addresses have the bitcoins sent to him. If someone explicitly announces that he has certain bitcoin addresses, then you will be able to know what addresses sent bitcoins to him and what addresses were sent bitcoins to. Disclosing your Bitcoin address is not unlikely, as you will need to give it to someone else in case you need to send you some money to it. It is recommended to use different addresses for different transfers to maintain a certain level of anonymity, although there are many who do not. Technically speaking, it remains possible to trace the source of some suspicious transactions on the Bitcoin network, as it is sufficient to track the transfer operations until they reach a known address, and at that time it is sufficient to carry out reverse investigations until reaching the suspicious account holder. It is true that the amount of data related to all transfers is huge, but the power of computers is constantly increasing and the possibility of tracking these processes is very possible, and it can even be asserted that tracking bitcoin theft operations is much easier than tracking the theft of money in paper form.
Currently, Bitcoin owners do not have many options to spend their money on, which leads some to exchange it for traditional currencies. This is usually done via dedicated platforms where bitcoins are exchanged with other users. It seems that if governments want to know the identities of some account holders, then what should I do?