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Latest BTC Trends In 2023
- Bitcoin Ordinals (NFTs) and BRC-20 tokens open up new ways to use the Bitcoin network using inscriptions, a recent innovation that allows data storage on the Bitcoin blockchain.
- About 1 million Bitcoin wallets now hold 1 BTC or more.
- BTC sees its price double from recent lows. After falling down into the $15,000 range during the FTX fallout, BTC has traded in a range up to nearly twice that price in 2023.
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What Is Bitcoin?
Bitcoin is a peer-to-peer electronic cash system, as described in the now-famous Bitcoin white paper. Created in 2009, Bitcoin was the first of today’s cryptocurrencies, later giving inspiration to projects like Ethereum and thousands of other crypto projects.
In its early days, Bitcoin traded for a fraction of a penny. By 2022, BTC had reached an all-time high approaching $70,000. Many predict new all-time highs yet to come, while others are more bearish on Bitcoin’s future.
While today’s crypto market offers thousands of other cryptocurrencies, Bitcoin still stands in a league of its own, topping the charts with the largest market capitalization and the best name recognition worldwide.
In addition to being the first among the current digital currencies, Bitcoin is also seen by many as being the most secure crypto network, largely due to its wide mining network and Bitcoin’s steadfast commitment to proof-of-work as its consensus method to validate transactions.
Like most other cryptocurrencies, the Bitcoin network works as a public ledger. For standard transactions, it’s trivial to see which wallet sent Bitcoin to which wallet, how much, and when the transaction happened.
Bitcoin was designed to be money, a verifiable and secure way to send value from person A to person B. But new developments like inscriptions (data storage) are bringing new functionality to the Bitcoin network, including Bitcoin’s own version of NFTs and BRC-20 tokens that trade on the Bitcoin network.
Who Founded Bitcoin?
Bitcoin was created by an anonymous team or individual. Someone using the pseudonym Satoshi Nakamoto is credited with the creation and has never been positively identified, despite several people claiming to be Satoshi over the years.
Bitcoin’s anonymous roots and fair launch (mined, not sold) also make the grandaddy of crypto a standout in the market. To our knowledge, Bitcoin was created without a profit motive — but rather with an altruistic intention: to offer a sound alternative to what was seen at the time as a broken financial system. Bitcoin’s launch coincided with the Great Financial Crisis (GFC) of the late Aughts.
Satoshis, or Sats, are the smallest division of Bitcoin, with each Bitcoin equal to 100 million Satoshis.
A large part of Bitcoin’s appeal is in its fixed supply. Bitcoin mining continues to grow the circulating supply, but there is a fixed limit to how many Bitcoin will ever exist: 21 million.
Just about every four years, the mining rewards for Bitcoin are cut in half, reducing the speed at which the supply grows. This event, called the Bitcoin halving, typically coincides with a sizable increase in price.
How Bitcoin Works
Bitcoin uses proof-of-work to validate transactions. In a nutshell, Bitcoin miners must invest computational power (electricity, hardware, and maintenance) to verify a block hash with specific requirements before transactions can be added to the blockchain. As the hash rate increases on the network, mining difficulty increases (and vice versa) to keep the average block time at about 10 minutes.
Miners earn both network fees and block rewards for successfully mining a block. Once transactions are validated in a block, it becomes prohibitively expensive for the block to be changed because all the subsequent blocks would also have to be mined again.
Bitcoin miners also use the longest chain, so a rogue miner working overtime to re-mine prior blocks is unlikely ever to produce the longest chain. Shorter chains are ignored. This clever structure makes Bitcoin transactions virtually impossible to reverse and truly decentralized, with over 1 million miners across the globe.
Like other cryptocurrencies, Bitcoin uses crypto wallets to store Bitcoin. Each wallet has private keys and public keys, with private keys allowing you to control your Bitcoin on the blockchain and send your Bitcoin to any public wallet address. Others can also send Bitcoin to your public wallet address, making Bitcoin function as a way to transfer value — like money, but without any middlemen like banks or payment services.
Frequently Asked Questions
Bitcoin price predictions range from north of $250,000 to more pessimistic views that see BTC eventually going to zero. Adoption plays a big role in the future value of Bitcoin. As more people use Bitcoin as a store of value and a way to transfer value to others, the demand for BTC increases. Given Bitcoin’s fixed supply, increased demand could mean higher prices to come.
Generally, Bitcoin focuses on use cases that involve the transfer of value, like sending Bitcoin to a family member or making a purchase in Bitcoin. Ethereum was designed to run smart contracts, computer programs that live on the blockchain. Another notable difference is in how the two networks validate transactions. Bitcoin still uses proof of work, whereas the Ethereum network uses proof of stake.
Both Bitcoin Ordinals and BRC-20 tokens use inscriptions, a form of data storage on the Bitcoin blockchain, to bring new functionality to Bitcoin. Ordinals are much like NFTs you’d see on other networks like Ethereum. BRC-20 tokens are similar to ERC-20 tokens found on the Ethereum network, a way to bring value or additional functionality to crypto projects.