Creation

In Aug. of 2008, the domain name bitcoin.org is registered. [1]

In Oct. that year, the now-famous white paper was published on bitcoin.org, which is entitled Bitcoin: A Peer-to-Peer Electronic Cash System [2]. It's authored by a Japanese name "Satoshi Nakamoto". [1]

Up to now, there is still inadequate personal information to verify his or her or their identity. [3]

Introduction

Bitcoin is a cryptocurrency, which is the first decentralized digital currency. [4]

It means transactions of bitcoin take place directly between one party to another without going through a financial institution. [2]

Objective

The double-spending problem, that is it is possible for a digital token could be spent more than once because digital files can be duplicated. It is a potential risk that can lead to serious devaluation of digital currency. [5]

Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. (Satoshi, 2009) Bitcoin is a solution to the double-spending problem using a peer-to-peer network. [2]

How does it work

Account and Password - keys

A bitcoin holder has a pair of keys: a public key and a private key. [2]

The former is like your bank account which is likely to be disseminated widely, and the latter is like a password, which is only known to the owner to keep the safety.

Balances - block chain

The block chain is significant in Bitcoin system. It is a shared public ledger. All confirmed transactions are recorded in the block chain. [6]

Transactions Processing - mining

The processing of a transaction is completed by finding a proof-of-work that is solving a range of difficult computing problems which need computers with enough processing power. [2]

In Bitcoin system, you can get reward of new-generated bitcoins by giving assistance to do such calculations. [2]

It is mining. There are a number of miners who want to make a profit. In the meantime, they ensure the Bitcoin system functions normally.

Conclusion

Bitcoin is powerful, which is easy, safe, fast, keeps your privacy and supports international payments without a service charge. [7]

Its technical and designed details is worth learning for us.

References

[1] What is 'Bitcoin'. (n.d). Retrieved March 7, 2018, from https://www.investopedia.com/terms/b/bitcoin.asp

[2] Satoshi, N. (2009). Bitcoin: A Peer-to-Peer Electronic Cash System. Retrieved March 7, 2018, from https://bitcoin.org/bitcoin.pdf

[3] L, S. (2015). Who is Satoshi Nakamoto?. Retrieved March 7, 2018, from https://www.economist.com/blogs/economist-explains/2015/11/economist-explains-1

[4] Brito, J., & Castillo, A. (2013). Bitcoin: A Primer for Policymakers. Retrieved March 7, 2018, from https://www.mercatus.org/system/files/Brito_BitcoinPrimer.pdf

[5] Chohan, U. (2017). The Double Spending Problem and Cryptocurrencies. Retrieved March 7, 2018, from https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3090174

[6] How does Bitcoin work?. (n.d.). Retrieved March 7, 2018, from https://bitcoin.org/en/how-it-works

[7] Bitcoin for Individuals. (n.d.) Retrieved March 7, 2018, from https://bitcoin.org/en/bitcoin-for-individuals