{"id":"bitcoin","title":"Bitcoin","content":"​[Bitcoin](https://iq.wiki/wiki/bitcoin) is a decentralized digital currency created in 2009 that operates without a central authority or banks, enabling peer-to-peer transactions on a cryptographic network. As the first and most valuable [cryptocurrency](https://iq.wiki/wiki/cryptocurrency), [Bitcoin](https://iq.wiki/wiki/bitcoin) pioneered [blockchain](https://iq.wiki/wiki/blockchain) technology and has significantly influenced global financial systems and digital asset development.\n\n## Overview\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) was introduced in a 2008 [whitepaper](https://iq.wiki/wiki/white-paper) titled \"[Bitcoin](https://iq.wiki/wiki/bitcoin): A Peer-to-Peer Electronic Cash System\" by an anonymous person or group using the pseudonym [Satoshi Nakamoto](https://iq.wiki/wiki/satoshi-nakamoto). The [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) was designed as an alternative to traditional financial systems following the 2008 global financial crisis. [Bitcoin](https://iq.wiki/wiki/bitcoin) operates on a decentralized network where transactions are verified by network nodes through cryptography and recorded on a public distributed ledger called a [blockchain](https://iq.wiki/wiki/blockchain).\n\nThe [core](https://iq.wiki/wiki/core-dao) innovation of [Bitcoin](https://iq.wiki/wiki/bitcoin) is its ability to solve the double-spending problem without requiring a trusted authority. It achieves this through a [consensus mechanism](https://iq.wiki/wiki/consensus-mechanism) called Proof of Work (PoW), where miners compete to solve complex mathematical puzzles to validate transactions and add new blocks to the [blockchain](https://iq.wiki/wiki/blockchain). This process also controls the issuance of new bitcoins, with miners receiving newly created bitcoins as rewards for their computational efforts.\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) has a fixed supply cap of 21 million coins, making it inherently deflationary and often compared to digital gold. This scarcity, combined with growing institutional adoption and recognition as a legitimate asset class, has contributed to [Bitcoin](https://iq.wiki/wiki/bitcoin)'s significant price appreciation over time, despite its notorious volatility.\n\n## History\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin)'s conceptual [foundation](https://iq.wiki/wiki/foundation) was laid out in the 2008 [whitepaper](https://iq.wiki/wiki/white-paper) published by [Satoshi Nakamoto](https://iq.wiki/wiki/satoshi-nakamoto). On January 3, 2009, Nakamoto mined the genesis [block](https://iq.wiki/wiki/block) ([block](https://iq.wiki/wiki/block) number 0) of the [Bitcoin](https://iq.wiki/wiki/bitcoin) [blockchain](https://iq.wiki/wiki/blockchain), which included a reference to a headline from The Times newspaper about bank bailouts during the financial crisis, embedding [Bitcoin](https://iq.wiki/wiki/bitcoin)'s creation in the context of criticism toward traditional banking systems .\n\nThe first real-world [Bitcoin](https://iq.wiki/wiki/bitcoin) transaction occurred in May 2010 when programmer Laszlo Hanyecz purchased two pizzas for 10,000 BTC, an event now celebrated annually as \"[Bitcoin](https://iq.wiki/wiki/bitcoin) Pizza Day.\" At the time, this amount of [Bitcoin](https://iq.wiki/wiki/bitcoin) had minimal value, but would later be worth billions of dollars [\\[1\\]](#cite-id-hfKbT5hL4x).\n\n​[Satoshi Nakamoto](https://iq.wiki/wiki/satoshi-nakamoto) remained active in Bitcoin's development until mid-2010, after which they handed over control of the source code repository to [Gavin Andresen](https://iq.wiki/wiki/gavin-andresen) and disappeared from public involvement. The true identity of Nakamoto remains unknown to this day, adding to Bitcoin's mystique .\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) gained mainstream attention during its first major price surge in 2013, followed by even greater public awareness during the 2017 bull run when it approached 60,000, driven by institutional adoption and growing recognition as a legitimate asset class.\n\n## Technology\n\nBitcoin's underlying technology is based on [blockchain](https://iq.wiki/wiki/blockchain), a distributed ledger that records all transactions [across](https://iq.wiki/wiki/across) a network of computers. This design ensures transparency, immutability, and resistance to censorship. Each [block](https://iq.wiki/wiki/block) contains a set of transactions, a [timestamp](https://iq.wiki/wiki/timestamp), and a reference to the previous [block](https://iq.wiki/wiki/block), creating a chain of blocks that cannot be altered without consensus from the network.\n\nThe Proof of Work consensus mechanism requires miners to solve complex cryptographic puzzles, a process that demands significant computational power and energy. This deliberate difficulty protects the network from attacks and ensures that adding new transactions to the [blockchain](https://iq.wiki/wiki/blockchain) requires real-world resources. The difficulty of these puzzles adjusts automatically every 2,016 blocks (approximately two weeks) to maintain an average [block](https://iq.wiki/wiki/block) creation time of 10 minutes [\\[2\\]](#cite-id-farC7Dh0k7).\n\n\"[Bitcoin](https://iq.wiki/wiki/bitcoin) is a technological tour de force,\" said Microsoft co-founder Bill Gates, acknowledging the innovative nature of [Bitcoin](https://iq.wiki/wiki/bitcoin)'s design, even as he maintained a cautious stance on cryptocurrencies overall .\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) transactions are pseudonymous rather than anonymous. While users' real identities aren't directly linked to their [Bitcoin](https://iq.wiki/wiki/bitcoin) addresses, all transactions are publicly recorded on the [blockchain](https://iq.wiki/wiki/blockchain), making it possible to trace transaction patterns. This has implications for both privacy and regulatory compliance.\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) undergoes protocol upgrades through a process called [Bitcoin](https://iq.wiki/wiki/bitcoin) Improvement Proposals (BIPs). Major upgrades have included Segregated Witness (SegWit) in 2017, which improved transaction capacity and fixed transaction malleability, and Taproot in 2021, which enhanced privacy, efficiency, and smart contract functionality.\n\n## Bitcoin Mining\n\n​Bitcoin mining is the process of using computer hardware to perform mathematical calculations that confirm transactions and enhance the security of the Bitcoin network. Miners group pending transactions into a \"block\" and, by solving a complex mathematical problem, add the block to the public ledger. This process creates a consensus that validates transactions and prevents malicious activities like double-spending, where a user attempts to spend the same bitcoins in multiple transactions [\\[2\\]](#cite-id-farC7Dh0k7) [\\[4\\]](#cite-id-F5xbqqshS8).\n\nThe collective computing power of the network, measured as the hash rate, makes it computationally difficult to alter the blockchain, ensuring the integrity of the transaction history. On average, a new block is added to the blockchain every 10 minutes through mining. As a reward for their computational services, miners receive newly created bitcoins (the \"block reward\") and the transaction fees attached to the transactions they include in the new block [\\[2\\]](#cite-id-farC7Dh0k7) [\\[4\\]](#cite-id-F5xbqqshS8).\n\nBitcoin mining is a highly specialized and competitive field. Rewards are distributed among miners based on the amount of computational work they contribute to the network. Due to its competitive nature, not all Bitcoin users engage in mining, and it is not considered an easy way to make money [\\[2\\]](#cite-id-farC7Dh0k7) [\\[4\\]](#cite-id-F5xbqqshS8).\n\n![](https://ipfs.everipedia.org/ipfs/QmXmDGDCwD3SQ4kok8ZMfkNWNSs9asapVQV9tXtYZpWc1T)\n\n## Tokenomics\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) has a predetermined supply cap of 21 million coins, with approximately 19 million already in circulation as of 2023. New bitcoins are created through the [mining](https://iq.wiki/wiki/mining) process, with the issuance rate [halving](https://iq.wiki/wiki/halving) approximately every four years in events known as \"halvings.\" This deflationary model contrasts sharply with traditional fiat currencies, which can be printed at will by central banks.\n\nThe [Bitcoin](https://iq.wiki/wiki/bitcoin) [halving](https://iq.wiki/wiki/halving) events, which reduce the [block reward](https://iq.wiki/wiki/block-reward) for miners by 50%, have historically preceded major bull runs in [Bitcoin](https://iq.wiki/wiki/bitcoin)'s price. These scheduled supply shocks, combined with increasing adoption, create a supply-demand dynamic that many analysts believe contributes to [Bitcoin](https://iq.wiki/wiki/bitcoin)'s long-term price appreciation [\\[3\\]](#cite-id-PUIRRCLSDf).\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin)'s smallest unit is called a satoshi, representing one hundred millionth of a [bitcoin](https://iq.wiki/wiki/bitcoin) (0.00000001 BTC). This divisibility allows for microtransactions and ensures that [Bitcoin](https://iq.wiki/wiki/bitcoin) can function as a medium of exchange even as its value increases [\\[4\\]](#cite-id-F5xbqqshS8).\n\n## Market Impact\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) has established itself as the dominant [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) by market capitalization, often accounting for over 40% of the total [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) market value. Its price movements frequently influence the broader [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) market, earning it the nickname \"digital gold\" due to its perceived role as a store of value and hedge against inflation.\n\nInstitutional adoption has significantly increased since 2020, with companies like MicroStrategy, Tesla, and Square adding [Bitcoin](https://iq.wiki/wiki/bitcoin) to their corporate treasuries. Financial institutions have also developed [Bitcoin](https://iq.wiki/wiki/bitcoin)-related products, including futures, options, and exchange-traded funds (ETFs), further legitimizing [Bitcoin](https://iq.wiki/wiki/bitcoin) as an asset class [\\[3\\]](#cite-id-PUIRRCLSDf).\n\n\"We believe [bitcoin](https://iq.wiki/wiki/bitcoin) is going to be the native currency of the internet,\" stated [Jack Dorsey](https://iq.wiki/wiki/jack-dorsey), former CEO of Twitter and founder of [Block](https://iq.wiki/wiki/block) (formerly Square), highlighting the growing corporate belief in [Bitcoin](https://iq.wiki/wiki/bitcoin)'s long-term potential.\n\nBitcoin's price volatility remains significant, with multiple boom-and-bust cycles throughout its history. These cycles have been characterized by rapid price increases followed by substantial corrections, though each cycle has generally established higher price floors than previous ones.\n\nFollowing a prolonged five-week period of outflows, U.S. spot Bitcoin ETFs experienced a significant trend reversal in February 2026. The investment vehicles began attracting substantial capital, with daily inflows exceeding $500 million. This renewed demand directly contributed to a recovery in the digital asset's value, with Bitcoin's price climbing back to the $68,000 level. The sharp turnaround in ETF flows fostered strong bullish sentiment across the market, leading some analysts to project a potential continuation of the rally into the $75,000-$80,000 range [\\[6\\]](#cite-id-4dlygjZYX75MBQjo) [\\[7\\]](#cite-id-FWowcDr303is6DyY).\n\n## Regulatory Landscape\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin)'s regulatory status varies significantly [across](https://iq.wiki/wiki/across) different jurisdictions. Some countries, like El Salvador, have adopted [Bitcoin](https://iq.wiki/wiki/bitcoin) as legal tender, while others have implemented varying degrees of regulation or outright bans. This regulatory uncertainty continues to impact [Bitcoin](https://iq.wiki/wiki/bitcoin)'s adoption and price.\n\nIn the United States, [Bitcoin](https://iq.wiki/wiki/bitcoin) is classified as a commodity by the Commodity Futures Trading Commission (CFTC), while the Securities and Exchange Commission (SEC) has taken a more cautious approach to [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) regulation overall. The Internal Revenue Service (IRS) treats [Bitcoin](https://iq.wiki/wiki/bitcoin) as property for tax purposes, meaning that transactions involving [Bitcoin](https://iq.wiki/wiki/bitcoin) can trigger capital gains tax events .\n\nIn mid-2025, the U.S. House of Representatives advanced a significant legislative package aimed at creating a comprehensive regulatory framework for digital assets. During a designated \"[Crypto Week](https://iq.wiki/wiki/crypto-week)\" in July, lawmakers considered several key bills, including the [CLARITY Act](https://iq.wiki/wiki/clarity-act) to establish market structure, the [GENIUS Act](https://iq.wiki/wiki/genius-act) for payment stablecoins, and the Anti-CBDC Surveillance State Act to prohibit a U.S. central bank digital currency. This legislative push, championed by figures like House Financial Services Committee Chairman French Hill and supported by the Trump Administration, was framed as an effort to foster innovation, protect consumers, and solidify the U.S. as a leader in the digital asset space [\\[5\\]](#cite-id-zSQRQcHhrj).\n\nRegulatory concerns often center around anti-money laundering (AML) and know-your-customer (KYC) requirements, consumer protection, market manipulation, and environmental impact. These concerns have led to increased scrutiny of [cryptocurrency](https://iq.wiki/wiki/cryptocurrency) exchanges and other service providers in the [Bitcoin](https://iq.wiki/wiki/bitcoin) ecosystem .\n\n## Criticisms and Challenges\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin) faces several significant challenges and criticisms. Its energy consumption has been a major point of contention, with critics arguing that the Proof of Work consensus mechanism consumes excessive electricity. Proponents counter that [Bitcoin](https://iq.wiki/wiki/bitcoin) increasingly utilizes renewable energy sources and can incentivize renewable energy development.\n\nScalability remains a technical challenge for [Bitcoin](https://iq.wiki/wiki/bitcoin), with the [base](https://iq.wiki/wiki/base) layer capable of processing only about 7 transactions per second. This limitation has led to the development of layer-2 solutions like the [Lightning Network](https://iq.wiki/wiki/lightning-network), which aims to enable faster and cheaper transactions while maintaining [Bitcoin](https://iq.wiki/wiki/bitcoin)'s security properties .\n\n​[Bitcoin](https://iq.wiki/wiki/bitcoin)'s price volatility presents challenges for its adoption as a medium of exchange, as merchants and consumers may be hesitant to use a currency whose value can fluctuate significantly in short periods. This has led some to view [Bitcoin](https://iq.wiki/wiki/bitcoin) primarily as a store of value rather than a day-to-day currency.\n\nSecurity concerns, including exchange hacks and personal wallet security, continue to affect the [Bitcoin](https://iq.wiki/wiki/bitcoin) ecosystem. While the [Bitcoin](https://iq.wiki/wiki/bitcoin) [blockchain](https://iq.wiki/wiki/blockchain) itself has never been successfully hacked, various services built around it have experienced security breaches, resulting in the loss of user funds.","summary":"Bitcoin is a decentralized digital currency, created in 2009, that operates without a central authority, using blockchain technology to enable peer-to-peer tran...","images":[{"id":"QmQnepiD5euMFwkAeC31r6kM8uNY6kUva4ieJ68uDmyhYX","type":"image/jpeg, image/png"}],"categories":[{"id":"cryptocurrencies","title":"Cryptocurrencies"}],"tags":[{"id":"Protocols"},{"id":"Marketplaces"},{"id":"Glossary"},{"id":"Blockchains"}],"media":[{"id":"QmQmnfgG7M4ATXsgT911bCtqnpde3NyHTLdG433Aj7hNyJ","size":null,"name":null,"type":"GALLERY","source":"IPFS_IMG"},{"id":"QmXmDGDCwD3SQ4kok8ZMfkNWNSs9asapVQV9tXtYZpWc1T","size":null,"name":null,"type":"GALLERY","source":"IPFS_IMG"},{"id":"QmZJnjnccev6ahNoqqya2dKiv33hpGuc62mwcduaW7zDy8","size":null,"name":null,"type":"GALLERY","source":"IPFS_IMG"},{"id":"Qmd3gDdu8whKcuaLg4HHmy6nY8qnJWj4ra7ma2HPgGDtZy","size":null,"name":null,"type":"GALLERY","source":"IPFS_IMG"}],"metadata":[{"id":"references","value":"[{\"id\":\"hfKbT5hL4x\",\"url\":\"https://coinmarketcap.com/alexandria/article/bitcoin-pizza-day-the-day-btc-was-first-used-as-money\",\"description\":\"CoinMarketCap Alexandria\",\"timestamp\":1745850146818},{\"id\":\"farC7Dh0k7\",\"url\":\"https://bitcoin.org/en/vocabulary#mining\",\"description\":\"Bitcoin.org\",\"timestamp\":1745850146818},{\"id\":\"PUIRRCLSDf\",\"url\":\"https://www.binance.com/en/price/bitcoin\",\"description\":\"Binance\",\"timestamp\":1745850146818},{\"id\":\"F5xbqqshS8\",\"url\":\"https://bitcoin.org/en/vocabulary#satoshi\",\"description\":\"Bitcoin.org\",\"timestamp\":1745850146818},{\"id\":\"zSQRQcHhrj\",\"url\":\"https://financialservices.house.gov/news/documentsingle.aspx?DocumentID=410793\",\"description\":\"U.S. House leadership announces \\\"Crypto Week\\\" for digital asset legislation\",\"timestamp\":1761655364183},{\"id\":\"4dlygjZYX75MBQjo\",\"url\":\"https://cointelegraph.com/news/bitcoin-traders-explain-why-80k-next-target-for-bulls?utm\\\\_source=rss\\\\_feed\\\\&utm\\\\_medium=rss\\\\&utm\\\\_campaign=rss\\\\_partner\\\\_inbound\",\"description\":\"Bitcoin traders explain why $80k is next target\",\"timestamp\":1772112025086},{\"id\":\"FWowcDr303is6DyY\",\"url\":\"https://decrypt.co/359201/bitcoin-selling-pressure-weakens-as-u-s-spot-etfs-draw-in-506m\",\"description\":\"Bitcoin selling pressure weakens as spot ETFs draw in over $500M\",\"timestamp\":1772112025086}]"},{"id":"previous_cid","value":"\"https://ipfs.everipedia.org/ipfs/QmSLDrLwZaFPx9N1JKbg4z93aEQAeGQ5UUgfMcDQfErTDJ\""},{"id":"commit-message","value":"\"Updated address and removed Ethereum entry\""},{"id":"previous_cid","value":"QmSLDrLwZaFPx9N1JKbg4z93aEQAeGQ5UUgfMcDQfErTDJ"}],"events":[{"id":"4bd47e7d-9d57-4be1-81c1-34559f61eb7f","date":"2009-01-01","title":"Date Founded","type":"CREATED","description":"On January 3rd, 2009, the Bitcoin network was created when Satoshi Nakamato (the project's mysterious creator) mined the “Genesis” block. The 50 bitcoin coinbase reward is unredeemable, as it was omitted from the transaction database.","link":"https://www.blockchain.com/explorer/blocks/btc/000000000019d6689c085ae165831e934ff763ae46a2a6c172b3f1b60a8ce26f","multiDateStart":null,"multiDateEnd":null,"continent":null,"country":null}],"user":{"id":"0x8af7a19a26d8fbc48defb35aefb15ec8c407f889"},"author":{"id":"0x8af7a19a26d8fbc48defb35aefb15ec8c407f889"},"operator":{"id":"0x162217e3b309cDd8855613d7CcC6283505993c58"},"language":"en","version":1,"linkedWikis":{"blockchains":["bitcoin"],"founders":[],"speakers":[]},"recentActivity":"{\"items\":[{\"id\":\"45b9a5d8-45cf-45e1-a8ff-a71d316a9b66\",\"title\":\"Bitcoin\",\"description\":\"Bitcoin is a decentralized digital currency, created in 2009, that operates without a central authority, using blockchain technology to enable peer-to-peer tran...\",\"timestamp\":\"2025-10-28T14:09:19.741Z\",\"category\":\"Wiki Update\",\"status\":{\"icon\":\"RiGlobalLine\",\"label\":\"Wiki Updated\",\"iconClassName\":\"text-green-500\"},\"user\":{\"name\":\"0x8af7a19a26d8fbc48defb35aefb15ec8c407f889\",\"address\":\"0x162217e3b309cDd8855613d7CcC6283505993c58\"},\"button\":{\"label\":\"View Summary\",\"icon\":\"RiFileTextLine\"},\"summarySections\":[{\"title\":\"History\",\"subtitle\":\"Updated information regarding Bitcoin's price history.\",\"variant\":\"modified\",\"changeCount\":1,\"changes\":[\"Modified the paragraph detailing the 2017 bull run and the 2021 all-time high.\"]},{\"title\":\"Bitcoin Mining\",\"subtitle\":\"A new section explaining the process of Bitcoin mining was added.\",\"variant\":\"added\",\"changeCount\":1,\"changes\":[\"Added a new 'Bitcoin Mining' section with explanatory text and an image.\"]},{\"title\":\"Market Impact\",\"subtitle\":\"Updated a quote within the Market Impact section.\",\"variant\":\"modified\",\"changeCount\":1,\"changes\":[\"Added an internal link to 'Jack Dorsey' in the quote attributed to him.\"]},{\"title\":\"Regulatory Landscape\",\"subtitle\":\"Added new information about U.S. digital asset legislation.\",\"variant\":\"modified\",\"changeCount\":1,\"changes\":[\"Added a new paragraph about the U.S. House of Representatives' 'Crypto Week' and related legislative efforts.\"]},{\"title\":\"Blockchains\",\"subtitle\":\"The associated blockchain for the wiki was specified.\",\"variant\":\"added\",\"changeCount\":1,\"changes\":[\"Added 'bitcoin' to the blockchains list.\"]},{\"title\":\"Metadata\",\"subtitle\":\"Added new metadata fields for tracking wiki statistics.\",\"variant\":\"added\",\"changeCount\":4,\"changes\":[\"Added metadata field 'words-changed'.\",\"Added metadata field 'percent-changed'.\",\"Added metadata field 'blocks-changed'.\",\"Added metadata field 'wiki-score'.\"]},{\"title\":\"References\",\"subtitle\":\"The list of references was updated.\",\"variant\":\"modified\",\"changeCount\":2,\"changes\":[\"Removed three references related to Bill Gates, Jack Dorsey, and country-specific Bitcoin legality.\",\"Added a new reference regarding U.S. digital asset legislation.\"]}]}]}"}