THE HISTORY OF BITCOIN
The Story of Bitcoin starts with our Finances are like human inventions, they are constantly changing. From the beginning of anything, it was just the basics. There was food traded for livestock, and livestock for resources, and like in wood, or maize, etc. Then it progressed into precious metals, such as silver and gold, etc. And now the next step is our Financial Rebirth which came to light. It started by "Satoshi" in the year 2008. This is where all things started for the Story of Bitcoin, And Things started taking shape for all and working for all.
This financial ReBirth is constantly changing over the past decade, was developed by an unknown person "Satoshi" has been maintained by collective groups of the brightest minds in our Technology. It’s the new form of currency that was created and stored digitally, the most important part is that of course, no government owns it, or decides its value - the peer-to-peer network community and People all over the world.
We call this new money, ‘Bitcoin’. or "CryptoCurrency"
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In our History, the USA currency Was based on gold and silver you can give a dollar bill to the bank and receive a set amount of gold back, In contrast. Bitcoin isn’t based on silver or gold - it’s based on mathematical proofs validated by a public ledger called blockchain technology.
Bitcoin is generated through a complex sequence of mathematical formulas that run on computers; this network shares a public ledger using blockchain technologies that record, and validate, every transaction processed.
No single institution or government anywhere can operate or control the Bitcoin or Cryptocurrency network. The idea behind this Financial Rebirth technology is growing and will always remain one of decentralization, remaining completely independent from any central authority, like a bank, or government, or a single country. Everyone can access the opensource software that makes and generates Bitcoins, it's these individuals interested in keeping it alive.
But, who invented Bitcoin? Is it a valid and legitimate currency like USD?
And why didn't anybody think of this before? Well, someone did. let’s talk about the creator of Bitcoin
How Did Bitcoin Start?
There are so many questions about Bitcoin, but there is the most common one that is asked, “Who created The Bitcoin?” That answer is straightforward because the identity of the creator remains a mystery. All we have is - Satoshi Nakamoto. The accounts of his are no longer active; the coins in his wallet has never been spent. Satoshi Nakamoto has disappeared from the world, so it would seem.
Fast Company recently published an article suggesting that Satoshi Nakamoto could be a group of people, including Neal King, Vladimir Oksman, and Charles Bry. These three people filed for a patent related to secure communication just two months before the purchase of the Bitcoin.org domain. Perhaps it’s a coincidence; perhaps it’s not.
What we do have, however, are facts:
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On October 31st, 2008, “Bitcoin: A Peer-to-Peer Electronic Cash System” was posted to a cryptography mailing list, published under the name “Satoshi Nakamoto”. The whitepaper outlined the foundation of how Bitcoin would operate.
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On August 18, 2008, an unknown person or entity registered the Bitcoin.org domain.
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On January 8th, 2009, the first version of Bitcoin is announced, and shortly thereafter, Bitcoin mining begins.
This mystery around Satoshi Nakamoto is fitting; privacy was a key value for both Bitcoin and its users. Others have tried to claim his mantle - most recently an Australian man named Craig Wright, who has since withdrawn his claim. While we may never know who first created Bitcoin, we do know that the technology he started has left ripples in the financial industry. Bitcoin has risen to fame thanks to individuals such as the Winklevoss twins controlling and growing the market, and major events that have defined this new technology and Financial Rebirth existence such as the Mt. Gox Ponzi scheme disaster. The people involved and events that occurred are a constant reminder that this market is unregulated and seems to fall in line with Satoshi Nakamoto’s goal of creating a decentralized network.
What is Bitcoin Used For?
The Bitcoin Currency must have some value and weight to ensure stability. The most common way a person to judge a Bitcoin’s value is how they can use it. Bitcoin is no different from our USD, plus a host of vendors and merchants now accept Bitcoins and Cryptocurrency alongside or in place of, fiat money.
One early adopter of Bitcoin was the computer retailer Dell. When Dell started accepting Bitcoins, it became one of the largest companies to do so internationally. While the digital currency may total for just a fraction of the retailer’s total transaction volume, there are other key reasons why the growth of Bitcoin could be a boom for the retailer.
Dell reported earnings of $59 billion during 2015. Traditional transaction fees range from 2 to 3 percent of the purchase price - with Bitcoin, it’s much, much lower, nearing non-existent - saving the retailer a lot of money in the future. In addition to Dell, many other companies accept Bitcoins, including airBaltic, an airline that offers tickets to 60 destinations in Europe, the Middle East, Russia, and other select locations. The company posted its announcement on Twitter after adopting the new practice, stating: They accept Bitcoins and Cryptocurrencies.
Other companies such as Expedia and Cheapair, have also started accepting Bitcoins, along with technology conglomerate Microsoft: users can add funds to their accounts with Bitcoin to purchase apps, games, and other types of digital content.
The acceptance of Bitcoins is a strategic decision on the part of these companies, most of which are reaching out to solidify their position with tech-savvy audiences. There’s a lot of benefit to Bitcoins, and a variety of reasons for its use, including:
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Faster Payment: Accepting wire transfers and checks are time-consuming, and it can take several days for the payment to clear. Bitcoin is faster and can take a matter of minutes, rather than days to process payment.
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Lower Transaction Fees: The cost to accept Bitcoins is lower compared to other payment methods, such as credit cards or Paypal.
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Independent of Governments: Since Bitcoin is decentralized, you own it - no authority has the right to take away your Bitcoin. People with concerns about mainstream banking systems unraveling find this a major benefit.
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Elimination of Chargebacks: Once Bitcoin is sent, that’s it - you can’t chargeback like you would with a credit card payment, which eliminates ‘chargeback fraud’ often used by criminals and scammers.
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Protection Against Inflation: With a fiat currency, the government can print as much money as it desires - this drastically decreases the value of the currency, and may result in inflation. In contrast, Bitcoin has a fixed number - after they have all been ‘mined’, no more Bitcoins will be created. Scarcity is an important aspect of currency which protects it from inflation.
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Ownership of Currency: With Bitcoin, you own your coins. With other forms of digital fiat - such as Paypal - your assets may be held, and your account eventually suspending, locking you out of your earnings. Bitcoin puts you in control.
Is Bitcoin a Commodity, or a Currency?
Bitcoin is both. While it can be used to purchase items from major retailers, it’s also treated as property by government jurisdictions, such as the IRS.
The IRS issued a guide on Bitcoin for tax purposes, stating it will treat virtual currencies as property for federal purposes. They go on to state that:
In some environments, virtual currency operates like “real” currency — i.e., the coin and paper money of the United States or of any other country that is designated as legal tender, circulates, and is customarily used and accepted as a medium of exchange in the country of issuance — but it does not have legal tender status in any jurisdiction.
The notice provides that virtual currency is treated as property for U.S. federal tax purposes.
Typically, the property is almost always something tangible that can be held in the physical realm. The IRS goes on to state that: General tax principles that apply to property transactions apply to transactions using virtual currency. Among other things, this means that:
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Wages paid to employees using virtual currency are taxable to the employee, must be reported by an employer on a Form W-2, and are subject to federal income tax withholding and payroll taxes.
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Payments using virtual currency made to independent contractors and other service providers are taxable and self-employment tax rules generally apply. Normally, payers must issue Form 1099.
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The character gain or loss from the sale or exchange of virtual currency depends on whether the virtual currency is a capital asset in the hands of the taxpayer.
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A payment made using virtual currency is subject to information reporting to the same extent as any other payment made in property.
In addition to the IRS’s guidance, the United States Commodities Futures Trading Commission in 2015 that Bitcoin is, in fact, a commodity.
