Cryptocurrency

What is bitcoin and how does it work?

A short guide to Bitcoin and how the cryptocurrency works.

Bitcoin is a decentralised digital currency that was created in 2009 by an anonymous developer or group of developers using the name Satoshi Nakamoto.

It has since become the most popular cryptocurrency in the world and its popularity has inspired the development of other cryptocurrencies.

Bitcoin operates on a decentralised blockchain (peer-to-peer technology) meaning that all transactions happen directly between equal, independent network participants. No single institution controls the Bitcoin network.

According to Nakamoto’s own words, Bitcoin was created to allow “online payments to be sent directly from one party to another without going through a financial institution.”

The Bitcoin source code was designed around the principle of a finite supply.

At the time of Bitcoin’s creation, the entire world’s money supply stood at approximately $21 trillion and according to an email shared by Mike Hearn ( a Bitcoin developer), Nakamoto intended Bitcoin‘s unit prices to eventually align with traditional fiat currencies, so that 0.001 BTC would be worth 1 Euro or 1 USD, for instance, and for this reason, it said that Nakamoto capped the number of coins to 21 million.

The limited supply of Bitcoin has a significant advantage. It maintains the cryptocurrency’s scarcity, guaranteeing that its value remains stable for years to come.

Bitcoin is commonly referred to as “digital gold” because, like gold, there is a finite amount of Bitcoin available.

On April 14, 2021, BTC hit an all-time high of $64,863.10 per Bitcoin.

Where can I buy Bitcoin?

Although Bitcoin remains a highly volatile unregulated asset, you can buy Bitcoin by using one of any number of the popular cryptocurrency exchange sites that exist. You can also buy Bitcoin through popular payment providers such as Paypal and Skrill and digital banks such as Revolut.

Popular Trading Platforms

Popular Bitcoin Exchanges

* Cryptoassets are highly volatile and unregulated in the UK. No consumer protection. Tax on profits may apply.

Other popular cryptocurrencies

  • Ethereum
  • XRP
  • Cardano
  • Solana
  • Tether
  • Polkadot
  • Dogecoin
  • Stellar
  • Chainlink
  • ApeCoin
  • Binance Coin
  • Terra
  • Avalanche
  • Uniswap

Not Investment Advice Indie Investor is for general information use only. It must not be relied upon by readers when making (or not making) their investment decisions. If in doubt you should seek advice from a professional financial adviser.

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