Assets, Bitcoin

Is Bitcoin a Utility Token?

Bitcoin is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain.

Bitcoin is unique in that there are a finite number of them: 21 million.

Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services.

As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.

Bitcoin is often called a cryptocurrency or digital currency. It is also sometimes called a virtual currency or Internet currency.

These are all different names for the same thing.

What is Bitcoin?

Bitcoin is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries.

Bitcoin is unique in that there are only 21 million of them: finite supply unlike other digital currencies like Ethereum which have an infinite supply. .

Bitcoins are created as rewards for “mining.” Mining is when somebody uses their computer to verify transactions in the Bitcoin network. As an incentive, when they successfully verify a transaction block they get rewarded with some bitcoins! The more blocks mined, the more difficult it becomes to find new blocks (hence why it’s called “mining”). As of February 2015, over 100,000 merchants and vendors accept bitcoin as payment worldwide including NewEgg, Overstock.com, TigerDirect, and Zapos.

Popularity has grown so much that some cities accept bitcoin in lieu of traditional currencies for transactions including Miami and Berkeley, CA. In May 2010 Laszlo Hanyecz made the first real world transaction by buying two pizzas from Papa John’s Pizza for 10 thousand bitcoins (worth about $25 USD at the time).

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