Bitcoin

When we talk about the internet, how do you ensure that when you send something, you didn’t have a copy and can’t continue using it? Imagine if it is electronic money?

One of the big challenges solved in Blockchain in Bitcoin was this: avoid double spending.

At this point, Blockchain acts as a distributed ledger. To validate a transfer, the Blockchain is consulted to make sure it has not been transferred before.

And by the consensus protocol, more than 50% of the validators have to agree with this, that is, certify that the transaction is not a double expense.

Bitcoin Whitepaper Abstract

A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. 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. We propose a solution to the double-spending problem using a peer-to-peer network. The network timestamps transactions by hashing them into an ongoing chain of hash-based proof-of-work, forming a record that cannot be changed without redoing the proof-of-work. The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power. As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they'll generate the longest chain and outpace attackers. The network itself requires minimal structure. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone.

Source: Bitcoin Whitepaper

Satoshi Nakamoto

Satoshi Nakamoto is how the creator of Bitcoin is known. It is a pseudonym, we do not know if it is a person or a group of people.

He invented the Bitcoin protocol and published it in a scientific article through a cryptography mailing list in October 2008.

This article, known as the Bitcoin Whitepaper, was published on October 31, 2008.

In 2009, he published the first version of the bitcoin client and participated with others in the project until his presence disappeared in late 2010.

Satoshi

The smallest unit of Bitcoin is called satoshi.

It is Bitcoin's 8th decimal place, meaning:

1 BTC = 100000000 satoshi

References

Conclusion

Bitcoin is the beginning of Blockchain and the financial revolution that is taking place. This lesson is just an introduction. I recommend reading the references listed.

In the next lesson you will learn about Ethereum.