By: Arthur Crowson | Dec 16, 2019 | Modified Apr 17, 2020
Coinbase is our favorite exchange for buying Bitcoin. You can view our in-depth reviews of alternative cryptocurrency exchanges on our best cryptocurrency exchanges listings page.
High: $20,089.00 USD — Dec. 17, 2019
Low: $0 USD – Jan. 3, 2009
$165+ Billion USD
Current Supply: ~18 Million
Total Supply: 21 Million
Max Supply: 21 Million
Average Transaction Per Second: 7
Rating : HIGH
Reason: 10 Million+ active addresses, fair distribution
Reason: First to market, most popular, most accepted
Reason: Most liquid coin, many trading pairs, many exchanges
The first and most popular cryptocurrency, Bitcoin is the brainchild of pseudonymous founder Satoshi Nakamoto. Free of third party oversight, Bitcoin offers a unique alternative to world government currencies. It’s the first cryptocurrency to dent the mainstream and easily the most famous cryptocurrency in the world. It’s renowned for its legendary swings that have seen its value increase and decrease at an exponential rate over the years. Over the years other cryptocurrencies have surpassed Bitcoin in terms of speed and features but no coin comes close to its market cap, number of users and overall popularity.
Bitcoin was officially announced to the world in a whitepaper by anonymous inventor (or group of inventors) Satoshi Nakamoto in October, 2008, titled “Bitcoin: A Peer-to-Peer Electronic Cash System”. This whitepaper also alerted the world to the invention of the blockchain, the network backbone of Bitcoin.
In May 2010, the first real-world product was purchased with Bitcoin when one individual paid another individual 10,000 Bitcoins for delivery of two pizzas, priced ~$25 USD. Over the intervening decade, the price of Bitcoin has fluctuated significantly, peaking at around $20,000 USD in 2017. As of December 2019, 10,000 Bitcoin were valued at over $100,000,000 USD.
The current supply of Bitcoin (as 2019) is numbered at around 18 million, out of the total that will ever be available of 21 million. This scarcity, and the fact that all other cryptocurrencies are compared against Bitcoin, has led some to call Bitcoin “digital gold.”
Bitcoin’s market cap, or the total number of Bitcoin held by users multiplied by its value in USD, peaked at an astounding $235 billion in 2017. It’s gone up and down since then but it’s easily the most valuable cryptocurrency in the world. The Bitcoin community is large and active, with abundant social media conversations, constant source code repository activity, and countless dedicated media publications aiding its adoption and popularity.
Bitcoin has several unique features that set it apart from other cryptocurrencies. It was the first to market, inspiring the invention of all subsequent cryptocurrencies. The network has a long history of not being hacked or compromised. Most importantly, its large and active community of advocates, developers, and users have continued to fuel its popularity.
Litecoin is the first spin-off of Bitcoin, as it just copied the codebase and made several notable improvements such as increasing the speed of the network. Other cryptocurrencies such as Bitcoin Cash or Bitcoin SV are direct “forks” of Bitcoin. However, not all coins are spin-offs of Bitcoin. ETH and EOS, for eg., were created from scratch using their own blockchains and codebases.
The most common way to convert Bitcoin to cash is to sell it on an exchange. There are number of major cryptocurrency exchanges that help facilitate such transactions. You’ll generally receive fiat (government-backed currency such as USD) directly to your bank account. In some countries there are also physical ATMs where it’s possible to convert Bitcoin to cash although there will generally be significant fees involved.
Yes. Holding Bitcoin and using it on a person-to-person basis is legal in nearly every country on earth.
It becomes more complicated when Bitcoin is designated as a currency or commodity. Bitcoin is still a relatively new phenomenon and governments are still deciding out how they want to regulate and potentially tax it. Bitcoin does have the potential to be used for money-laundering or criminal activity so it’s no wonder that governments are keenly interested in regulating it properly.
Many of the world’s biggest countries including the United States, Canada, Germany and the United Kingdom have taken a pro-Bitcoin approach while countries such as Russia and China are more restrictive.
You should check your local laws but for the most part Bitcoin is completely legal.
This is a hotly disputed topic. It’s easy to say that Bitcoin has no intrinsic value because it’s not tied to gold or another precious metal but neither is the US dollar.
Bitcoin is backed by math, which these days might actually be more solid than some government-backed currencies. There’s also a finite supply, which generally helps something become valuable.
In reality Bitcoin’s greatest value might just be its utility. It’s easy to send around the world. You don’t need a bank account to acquire it and the fees are still relatively low. All you need is a computer or a smartphone.
To a certain degree. It’s a common misconception that Bitcoin is completely anonymous. Each user actually has a public key that can be traced through the network back to an IP address or Bitcoin exchange account.
That means your actual identity won’t be revealed but everyone on the network can potentially see every transaction thanks to the transparent nature of the blockchain.
Bitcoin mining is essentially a reward for the people who maintain the network with powerful computers.
Mining Bitcoin serves two purposes: 1. It maintains the network by confirming transactions. 2. It creates new bitcoin, which serves as an incentive to the miners.
As the network has gotten more complex the difficulty in mining Bitcoin has gone up exponentially. That’s why mining Bitcoin is now pretty much limited to huge mining groups rather than individuals. It’s not recommended for individuals.
That’s a challenging question to answer because you CAN make money buying Bitcoin but you can also lose money.
It’s a little like asking, “Can I make money by investing in Tesla?”
There are no guarantees in the investment world and the same goes for cryptocurrency. In fact cryptocurrency is even more volatile with huge swings happening all the time.
Just remember that you should never invest more than you’re willing to lose.