Bitcoin: The Who, What, When, Where, How, and Why

By Abigail McCullough

Introduction

Prior to starting this internship, I had very little knowledge of Bitcoin and how it worked. I had a general understanding of its functions and importance, such as it not being a physical coin that you carry around in your wallet and that there is a finite quantity of Bitcoin in the world. As our world continues to advance, I believe that it is important to educate oneself, as these technologies will soon be heavily implemented into our everyday lives. After speaking with members at Atlas Wealth Partners, I can now say that I truly understand Bitcoin and will utilize this newfound knowledge for future endeavors. 

Who?

Satoshi Nakamoto, the person behind the invention of Bitcoin, presented their idea to the public back in 2008. The face behind Bitcoin still remains a mystery, as the developer or developers decided to use a fictitious name to conceal their identity. On one of his internet profiles in 2012, Nakamoto claimed to be a 37-year-old man living in Japan. However, it is speculated that Nakamoto is not Japanese at all due to his native-level use of the English language. Some say that the code used within Bitcoin is too well-designed for just one person to create, therefore introducing the theory that there is a team of people behind the development of Bitcoin. With that said, we may never know the uncovered face of Bitcoin or if society will keep being led by a pseudonym name.

What?

This is a question that I have asked myself and others several times, as Bitcoin is hard to fathom since it is not a tangible object. Bitcoin is a cryptocurrency, also known as a virtual currency, that is designed to act as a form of payment. What makes Bitcoin so unique is that it is not under the control of any single person, group, or entity, completely removing the need for any third-party interference. Bitcoin is created, distributed, stored, and traded through a system called a blockchain. A blockchain is a distributed database best known for maintaining a secure and decentralized record of transactions. The security and exclusivity of Bitcoin is what makes it very attractive to society, as it requires no government interference, unlike fiat currency. 

When and Where?

In 2009, Bitcoin was created as the first ever decentralized cryptocurrency. It was launched by a single individual or a group of people under the name Satoshi Nakamoto, which was stated earlier as the creator’s pseudonym name. In 2008, Satoshi Nakamoto published a white paper, which is a report meant to help readers better understand certain issues or topics. The white paper revealed that Bitcoin would utilize a blockchain system, as described previously, which would be the secure backbone of the cryptocurrency market. 

How?

In order to obtain any Bitcoin, it must be mined. Mining for Bitcoin is such an unusual and unique process because, in order to get cash, it is just printed and there is so much of it in circulation. This is what makes Bitcoin so valuable and desirable, as there are limited quantities of it and not as much of it in circulation. Bitcoin mining is similar to solving a very complex math problem. The Bitcoin miners are using different hardware and software to generate cryptographic numbers to match a number set by the Bitcoin algorithm. The first miner to find the solutions gets rewarded with a Bitcoin, as they create a new block that is added to the blockchain, and the process begins again. The rewards for mining Bitcoin are cut in half every 4 years. In 2009, finding the solution for one block earned you 50 BTC. However, after several 4-year cycles, the reward for one block is now 3.125 BTC in 2024. As a result of the halving process, the increasing value of Bitcoin, and decreasing quantity of Bitcoin left, the mining process is becoming extremely competitive. 

Why?

The biggest factor that makes Bitcoin so unique is that there is a finite quantity of it. There will only ever be 21 million Bitcoin in the world, unlike fiat currency, where you can create an infinite amount of cash or coins. As of 2024, there are only about 1.2 million Bitcoin left to be mined, which is not enough for every single person on the planet to even have 1 Bitcoin. Doubling the finite quantity with its difficulty to earn makes Bitcoin extremely valuable once you can acquire it. If you do a simple Google search for the conversion of Bitcoin (BTC) to USD, 1 Bitcoin is worth around $70,000 USD. The value of cash is depleting by the day since the government is able to print it so freely and easily, which is the complete opposite of Bitcoin. At a certain point, the value of $1 is going to be so insignificant, which is where Bitcoin steps in, as the value of it can never be argued. Again, when you combine the finite quantity of Bitcoin, the laborious work of mining, no government interference, and its increasing value, there is no doubt that Bitcoin is going to be the only reliable currency of our future.