Bitcoin (BTC) is the first and the most popular decentralized digital currency. Created by an anonymous figure under the name Satoshi Nakamoto, it is a peer-to-peer virtual cash that can be bought, sold, and exchanged without intermediaries like banks and other traditional financial institutions.
The Bitcoin network is particularly trustworthy and reliable for its underlying Blockchain technology. This type of a distributed ledger technology uses secure cryptographic algorithms to carry out complex and immutable mathematical functions. In simple words, each Bitcoin transaction uses a computer to solve mathematical puzzles. New units of Bitcoin also get created in the process to reward the person behind the computer hence the "puzzle game" is referred to as mining.
In the current Bitcoin halving cycle — which lasts about four years — an estimated 900 new Bitcoins are mined every day. After the halving, mining rewards are cut in half. With Bitcoin’s total supply pre-defined on its protocol and capped at 21 million, more than 19 million have been mined so far. This limit, known as the hard cap, is essential to Bitcoin's value proposition as a currency and asset even as its remaining supply is predicted to be mined by the year 2140.
A major benefit of Bitcoin is that it is an easily accessible and versatile currency. Bitcoin is the most well-known cryptocurrency because it is well established, has a large user base, and is more widely accepted than others. Bitcoin has been ahead of alternative currencies (or altcoins) with its ability to operate as a store of value since 2008 with seamless security.
Bitcoin maintains its integrity as a payment system by allowing the entire body of users—including holders, developers, and miners—to participate in its governance. The decentralized currency is run by a collective of users and hence does not rely on a single or a limited group of decision-making entities.
Coming in the wake of the Global Financial Crisis of 2008, Bitcoin is seen as a solution to some of the existing problems in the centralized finance system. These issues, including those related to inflation, remittances, efficiency in charity donation allocation, and overall monetary resources, are being addressed by Bitcoin and its evolving use cases. Consequently, the cryptocurrency grew in popularity as a virtual payment system as well as being the best-performing asset in 2021.