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Bitcoin, created by the pseudonymous Satoshi Nakamoto in 2009, was the first practical implementation of blockchain technology. It introduced a peer-to-peer electronic cash system that operates without banks, governments, or any central authority.
| Date | Event |
|---|---|
| 31 October 2008 | Satoshi Nakamoto publishes the Bitcoin whitepaper: "Bitcoin: A Peer-to-Peer Electronic Cash System" |
| 3 January 2009 | The genesis block (Block 0) is mined |
| 12 January 2009 | The first Bitcoin transaction: Satoshi sends 10 BTC to Hal Finney |
| 22 May 2010 | "Bitcoin Pizza Day" — Laszlo Hanyecz pays 10,000 BTC for two pizzas |
| 2011 | Bitcoin reaches parity with the US dollar (1 BTC = 1 USD) |
| 2017 | Bitcoin reaches nearly 20,000 USD; altcoin boom begins |
| 2021 | Bitcoin reaches an all-time high of ~69,000 USD; El Salvador adopts BTC as legal tender |
Bitcoin uses the Unspent Transaction Output (UTXO) model:
Alice has 5 BTC (from a previous transaction output)
Alice wants to send 3 BTC to Bob:
Input: Alice's UTXO (5 BTC)
Output 1: 3 BTC to Bob's address
Output 2: 1.9999 BTC back to Alice (change)
Fee: 0.0001 BTC (implicit: input - outputs)
Alice signs the transaction with her private key
1. Alice creates and signs a transaction
2. The transaction is broadcast to the Bitcoin network
3. Nodes validate the transaction (signature, UTXO existence, no double-spend)
4. Miners include the transaction in a candidate block
5. A miner finds a valid Proof of Work and broadcasts the block
6. Nodes verify and add the block to their chain
7. After ~6 confirmations (~60 minutes), the transaction is considered final
| Parameter | Value |
|---|---|
| Block time | ~10 minutes (target) |
| Block size | 1 MB base + SegWit witness data (~4 MB effective with SegWit) |
| Maximum supply | 21 million BTC |
| Current block reward | 3.125 BTC (after April 2024 halving) |
| Halving interval | Every 210,000 blocks (~4 years) |
| Difficulty adjustment | Every 2,016 blocks (~2 weeks) |
| Throughput | ~7 transactions per second (on-chain) |
| Consensus | Proof of Work (SHA-256) |
The block reward halves approximately every four years:
| Halving | Year | Block Reward | Cumulative Supply (approx.) |
|---|---|---|---|
| Genesis | 2009 | 50 BTC | 0 |
| 1st | 2012 | 25 BTC | 10.5 million |
| 2nd | 2016 | 12.5 BTC | 15.75 million |
| 3rd | 2020 | 6.25 BTC | 18.375 million |
| 4th | 2024 | 3.125 BTC | 19.6875 million |
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