Dec 172013
 

Bitcoin is a currency, just like the real or the dollar, but quite different from the examples cited. The first reason is that it is not possible to tinker in the pants pocket and find one forgotten. It does not exist physically, it is totally virtual.

The other reason is that its issue is not controlled by a Central Bank. It is produced in a decentralized fashion by thousands of computers, held by people who "lend" their machine's ability to create bitcoins and record all transactions made.

In the process of birth of a bitcoin, called "mining", the computers connected to the network compete with each other in solving mathematical problems. Whoever wins, receives a block of the coin.

The difficulty level of the challenges is adjusted by the network, so that the currency grows within a limited range, which is up to 21 million units by the year 2140.

This limit was set by the creator of the currency, a mysterious developer named Satoshi Nakamoto - who, to this day, has never had a proven identity.

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