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What Is Bitcoin?

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Bitcoin means different things to different people. For some, it is a future of freely moving currency untied to any central bank. To others, it is a purely digital entity of questionable value and dubious origin. But what is Bitcoin, in the most basic sense?

Bitcoin means different things to different people. For some, it’s the future. For others, it is a speculative bubble about to burst any day now. And for most, Bitcoin is still a mysterious platform for internet money.

Let’s take a look at what Bitcoin really is. 

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Bitcoin, or bitcoin [⇨] (from the English Bitcoin, from bit - bit and coin - coin), is a peer-to-peer payment system that uses the unit of the same name to account for transactions. Cryptographic methods are used to ensure the functioning and protection of the system, but at the same time, all information about transactions between the system addresses is available in open form. The minimum transmitted value (the smallest crushing value) - 10-8 bitcoin - was called “satoshi” in honor of the creator Satoshi Nakamoto, although he himself used the word “cent” in such cases. An electronic payment between two parties occurs without intermediaries and is irreversible - there is no mechanism for canceling a confirmed transaction (including cases when the payment was sent to an incorrect or non-existent address, or when the transaction was signed with a private key that became known to others). Nobody can block (arrest) funds, even temporarily, with the exception of the owner of the private key (or the person to whom he became aware). But the provided multi-signature technology allows you to attract a third party (arbiter) and implement “reversible transactions”. Using a special scripting language, it is possible to implement other options for smart contracts, however, it is not accessible from the graphical interface and is not Turing-complete, unlike newer blockchain systems. Different authors classify bitcoins in different ways. The most common options are: cryptocurrency, virtual currency, digital currency], electronic cash.
Bitcoins can be used to exchange goods or services with sellers who agree to accept them. Exchange for regular currencies occurs through the online digital currency exchange service, other payment systems, exchange offices or directly between interested parties. The commission for operations is appointed by the sender voluntarily, the size of the commission affects the priority in processing the transaction. Typically, the client program tells the recommended size of the commission. Transactions without a commission are possible and also processed, but are not recommended, since their processing time is unknown and can be quite large. One of the main features of the system is complete decentralization: there is no central administrator or any analogue of it. A necessary and sufficient element of this payment system is the basic client program (it has open source code). Client programs launched on many computers are connected to each other in a peer-to-peer network, each node of which is equal and self-sufficient. It is impossible to publicly or privately control the system, including changing the total number of bitcoins. The volume and time of the release of new bitcoins are known in advance, but they are distributed relatively randomly among those who use their equipment for calculations, the results of which are a mechanism for regulating and confirming the legality of operations in the Bitcoin system. In short, Latin BTC is often written instead of “bitcoin”. Such a record is similar to currency codes, however, a similar code has not yet been assigned by the international standard ISO 4217. On October 7, 2014, the Bitcoin Foundation announced plans to standardize code for bitcoin. The BTC record contradicts the standard system - to name “global goods” starting with X (for example, gold has the XAU code). An XBT option is being considered as a candidate. When specifying BTC or XBT, it means the unit of account, and not the network, the set of algorithms, or any other entity related to this topic. The Bitcoin sign BitcoinSign.svg is included in the Unicode standard version 10.0, it is assigned the number U + 20BF. Sometimes the symbol ฿ is used - the Thai baht sign, but it is not supported by all encodings and fonts. The URI scheme "bitcoin:" for operations with bitcoins via hyperlinks is officially included in the WHATWG specification for HTML5. Bitcoin is also planned to be added to the list of currencies in Microsoft Excel 2016

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