From an Anonymous Experiment to a Global Financial Phenomenon: The History of Bitcoin

Abstract

In late 2008, an anonymous author known as Satoshi Nakamoto introduced a paper describing a "peer-to-peer electronic cash system" called Bitcoin. This marked the creation of a decentralized digital currency designed to operate without intermediaries. Bitcoin functions on a technology called blockchain, which acts as a public and immutable ledger. Transactions are grouped into blocks and validated by a network of miners, who earn new Bitcoins for their work. The currency's programmed scarcity, capped at 21 million units, has helped it evolve from a simple experiment into a store of value, providing a hedge against inflation. This same blockchain technology has since inspired a new industry of cryptocurrencies and decentralized applications.