Understanding and History of the Discovery of Bitcoin

Understanding and History of the Discovery of Bitcoin

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What is Bitcoin? Who is the creator of Bitcoin? What are the advantages and disadvantages of using Bitcoin? A series of simple questions related to the booming digital currency originating from Japan. Beginning of bitcoin on January 3, 2009, Satoshi Nakamoto launched 31,000 lines of programming code and announced over the internet his artificial currency called Bitcoin.

Bitcoin’s early presence was also marked by the world’s first 50 Bitcoins generated through the system, which later became known as the “Genesis Block”. Uniquely, Nakamoto himself mined the “Genesis Block”, on January 3, 2009.

Bitcoin is not in the form of coins, paper money, silver, let alone gold. It doesn’t look real. It’s just a digital currency. Nakamoto is known as the creator of Bitcoin. The currency is completely controlled by software. Every ten minutes or so, Bitcoins will be distributed to those who are “mining“.

Initially, Bitcoin was popular among cryptographers, i.e. those involved in encryption research (cryptography). Not surprisingly, cryptography is the foundation on which Bitcoin stands. In his early days, Nakamoto was also active in the cryptographer community. He is reportedly quite diligent in replying to posts on various cryptography forums.

Nakamoto had a pretty loud voice when Wikileaks wanted to use Bitcoin to receive donations. At that time, Nakamoto protested the plan. According to him, Bitcoin is not ready for that kind of attention.

“This project needs to grow slowly so the software can be strengthened as it goes on. I suggested to Wikileaks, please don’t use bitcoin. Bitcoin is a beta community that is still in its infancy. You won’t get (donation via bitcoin) more than pennies, but the impact you will have brings it can destroy us,” wrote Nakamoto on December 5, 2010.

But over time, Nakamoto’s digital currency is getting more and more attention for digital transactions. Its popularity slowly rose to attract the attention of a wider circle. The value of Bitcoin has also increased. When it was first launched, one Bitcoin was worth less than 1 US dollar. But in mid-December 2013, one Bitcoin was around 710 US dollars.

Where’s Nakamoto?

Behind the success story of this digital currency, Nakamoto apparently chose to leave Bitcoin. On December 12, 2010, about seven days after submitting his opinion to Wikileaks, Nakamoto wrote his last message on the forum. Of course, at that time no one thought it would be Nakamoto’s last post. It is still fairly regular, although less frequent, replying to Bitcoin activist emails.

At that time, the lead of Bitcoin development was held by Gavin Andresen. This developer was originally famous for the Bitcoin Faucet site which aims to distribute 10,000 bitcoins for free. Andresen is the only one who can still communicate via email with Satoshi Nakamoto. On April 26, 2011, Andresen delivered a message from the founder.

“This morning Satoshi suggested that I, and we (the bitcoin community), should start not to exaggerate the existence of the ‘mysterious founder’ when speaking publicly about bitcoin,” wrote Andresen. In April 2011, Nakamoto sent a message to his colleagues that he had “moved on to other things”.

Since then, Nakamoto’s name has disappeared and is untraceable. Attempts to contact him were made by Bitcoin activists to no avail. There had been speculation that Satoshi was actually a leading cryptography researcher. Several names were “nominated” as the man’s real identity, but no one confessed.

Someone once said that Satoshi Nakamoto was just a pseudonym taken from the name of technology companies Samsung, Toshiba, Nakamichi, and Motorola. Allegedly, due to his excellent English, Satoshi wasn’t even from Japan. In fact, he is called not just one person. One theory that is quite widely accepted is that Satoshi Nakamoto actually represents a team. Bitcoin is said to be so well designed that it seems impossible for one person to create it.

Who is Satoshi Nakamoto really? Apparently, this is a question that doesn’t need to be answered. What is more important is to see the results of his work, and how it can affect today’s society.
Admit it or not, Bitcoin fever is sweeping the world. Cryptocurrencies that are decentralized and are not regulated or guaranteed by a central authority are widely used for transactions in various countries, including Indonesia. Although it has a number of advantages over “conventional” currencies, Bitcoin is not without risks. There are several threats that lurk the users of this virtual money. One of them relates to the issue of storing Bitcoin.

To be able to spend Bitcoin, the owner needs a special line of code called “private key”. This line of code is stored in a “wallet” or digital wallet. When it will be used, then the owner accesses the code and uses it for transactions. The private key can be stored locally on the computer or printed with a printer. The problem arises because this line of code can be stolen or lost. If that happens, all Bitcoins associated with the private key will disappear forever from the owner’s hands.

There have been several cases like this in the last few months. For example, the event that overrides Inputs.io. The online wallet provider was last November hacked by hackers, resulting in “customers” losing Bitcoin worth 1.2 million US dollars.

Private keys stored in “Cold Storage” (computers or storage media that are not connected to the internet) also have their own vulnerabilities. A man named James Howells stored 7,500 Bitcoins in a wallet on his computer’s hard disk. When the hard disk was lost, Howells was forced to give up the virtual money worth millions of dollars.

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