With paper money, a state decides when to print and distribute money. Bitcoin doesn’t have a central government.
With Bitcoin, miners use special software to solve math puzzles and are assigned a certain number of Bitcoins in exchange. This render a smart way to issue the currency and also creates an incentive for more people to mine.
Mining is the process of producing bitcoins. Once achievable with nothing more than a single CPU (central processing unit) based home computer, it has now become a multi-billion dollar industry and a complicated and expensive process involving equipment with short life expectancy of no further value past its shelf life. Due to the high costs of equipment, manufacturing, and power consumption, profit margins on bitcoin mining have become thin and sometimes not profitable at all during certain times of increased difficulty, high power costs, and technological performance roadblocks.
Where Did Bitcoin Come From
Bitcoin was developed by Satoshi Nakamoto in 2008. Bitcoin’s claim to fame is that it is the world’s first decentralized digital currency. Not the first overall digital currency, but the first one to solve the problems associated with decentralization.
Transactions, Blocks, Mining, and the Blockchain
The bitcoin system, unlike traditional banking and payment systems, is based on decentralized trust instead of a central trusted authority. With bitcoin and its blockchain technology, trust is achieved as an emergent property from the interactions of different participants in the bitcoin system.
A blockchain explorer is a web application that operates as a bitcoin search engine in that it allows you to search for addresses, transactions, and blocks and see the relationships and flows between them.
You can learn more about Bitcoin and the Blockchain here.