Bitcoins
Your Way into the world of Bitcoins
What's a Bitcoin?
It's the state-of-the-art in money. It's a new form
of electronic money.
It's already become "the gold standard" of digital currency.
Bitcoin is the result of combining the very state of the art in cryptographic security + the idea of a limited quantity commodity similar to gold and silver (where there's only so much of it) and using it as money + the idea of massive numbers of computers connected by the internet forming a strong,
resilient, indestructible peer-to-peer network. It's called a cryptocurrency.
Since the invention of Bitcoin
Money will never be the same.
This video is a short animated introduction to Bitcoin, made possible with donations from the Bitcoin community.
Bitcoin is open-source. Nobody owns it; the most popular client is maintained by a community of open-source developers.
How much is a Bitcoin worth?
365 days a year.
They match buyers and their "bid prices" with sellers and their "asking prices".
Normally, what we call the "value of a Bitcoin" is simply the last amount
a Bitcoin sold for on one of the major markets.
Where to see and explore:
You can directly explore the system in action by visiting Blockchain.info or
Bitcoin Block Explorer. The site shows you the latest blocks in the block chain.
The block chain contains the agreed history of all transactions that took place in the system.
Note how many blocks were generated in the last hour, which on average will be 6.
Also notice the number of transactions and the total amount transferred in the last hour (last time I checked it was about 64 and 15K). This should give you an indication of how active the system is.
Source: Blockchain
Next, navigate to one of these blocks. The block's hash begins with a run of zeros. This is what made creating the block so difficult; a hash that begins with many zeros is much more difficult to find than a hash with few or no zeros. The computer that generated this block had to try many Nonce values (also listed on the block's page) until it found one that generated this run of zeros. Next, see the line titledPrevious block. Each block contains the hash of the block that came before it. This is what forms the chain of blocks. Now take a look at all the transactions the block contains. The first transaction is the income earned by the computer that generated this block. It includes a fixed amount of coins created out of "thin air" and possibly a fee collected from other transactions in the same block.
Drill down into any of the transactions and you will see how it is made up of one or more amounts coming in and out. Having more than one incoming and outgoing amount in a transaction enables the system to join and break amounts in any possible way, allowing for any fractional amount needed. Each incoming amount is a past transaction (which you can also view) from someone's address, and each outgoing amount is addressed to someone and will be part of a future transaction (which you can also navigate down into if it has already taken place.)
Finally you can follow any of the addresses links and see what public information is available for them.
To get an impression of the amount of activity on the Bitcoin network, you might like to visit the monitoring websites Bitcoin Monitor and Bitcoin Watch. The first shows a real-time visualization of events on the Bitcoin network, and the second lists general statistics on the amount and size of recent transactions.
See Also
- TryBTC - Easiest way to get started using bitcoin.
Gives you free coins to create a bitcoin wallet and start spending. - Installing Bitcoin getting started
- Using Bitcoin
- A gentle introduction to Bitcoin - BitcoinMe
- Bitcoin Primer from CoinLab
- Another introduction, The Rebooting Of Money podcast is found at Bitcoin Money
- A beginner's step-by-step guide to using Bitcoin, use of alternative wallets, and generally keeping your money and computer secure - BitcoinIntro.com
- howtobitcoin.info - Directory of bitcoin links for beginners
