The iconic Bitcoin (BTC) white paper celebrates its thirteenth anniversary as a financial disruption. It was first published on October 31, 2008. This was done at the time by an anonymous person or entity named Satoshi Nakamoto.
Most Profitable Investment of the Internet Age
The white paper, entitled Bitcoin: ‘A Peer-to-Peer Electronic Cash System’, envisioned the need for a peer-to-peer (p2p) online payment system. This system is self-governing, safe and limited in quantity. The BTC network was launched on January 03, 2009, with a price of $0.0008 per Bitcoin at the time.
Initially, Bitcoin was seen as a major threat by traditional financial institutions. But thirteen years of support from the global community and a growing user base changed that. Bitcoin was made one of the most profitable investments for the internet age. Today, Bitcoin has a trade value of over $60,000. This represents a gradual increase in value of 7,749.999.900% since its launch.
Avoid double spending
The Bitcoin whitepaper proposes a solution to avoid double spending without the risk of trusting a third party. For this, the use of “fair” nodes is called. These nodes confirm transactions by overpowering the bad actors in terms of raw power of computers with a central processing unit (CPU).
Interestingly enough, the Bitcoin whitepaper lists 15 “fair” and one “unfair” node. This explains the need for fair nodes to ensure the credibility of any trade. In the words of Satoshi Nakamoto:
“We have proposed a system for electronic transactions without trust. Honest nodes vote with their CPU power, expressing their acceptance of valid blocks by working on their extension and rejecting invalid blocks by refusing to work on them.”
The Bitcoin blockchain has mined block number 707542, yielding a mining reward of 6.25 million BTC. With the Bitcoin ecosystem slowly approaching its hard cap or maximum supply of 21 million BTC, the developer community will need to adjust existing rules to incentivize miners confirming Bitcoin transactions on the blockchain. The white paper states the following about this:
“All necessary rules and incentives can be enforced with this consensus mechanism.”
Musk’s Legal Tender and Trust
Despite continued resistance from many governments and authorities such as China, this year marks the beginning of Bitcoin’s legacy as legal tender in El Salvador. Bitcoin’s long-term effect on El Salvador’s bloated economy will determine the asset’s mainstreaming in other jurisdictions.
The success of Bitcoin and its crypto ecosystems as viable investments continues to attract investors from all walks of life. The richest man in the world, Elon Musk, recently showed support for cryptocurrencies. This is what Tesla’s CEO did at the Code Conference in California:
“It is not possible, I think, to destroy crypto. But it is possible for governments to slow its progress.”
Musk also believes that “cryptocurrency is fundamentally aimed at reducing the power of a centralized government,” which may be one of the main reasons for Bitcoin’s slow mainstream adoption rate. Musk has also been highly influential in influencing the market price of other cryptocurrencies such as Dogecoin (DOGE).