WEBVTT

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[MUSIC PLAYING]

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Bitcoin is the first
decentralized digital currency.

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It is also sometimes referred
to as a virtual currency

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or a cryptocurrency.

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Bitcoins are held
in a digital wallet

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and can be sent
over the internet.

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Bitcoin transactions
are authorized

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using a digital signature.

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The transactions are verified,
usually within minutes,

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by a network of miners.

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Once verified, the
transaction is permanently

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stored on a public ledger,
known as the blockchain.

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Fees for Bitcoin transactions
are relatively low

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compared to traditional ways of
commercially transferring money

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over the internet.

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Bitcoin was started in 2009.

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It follows the ideas set out
in a white paper released

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under the name Satoshi Nakamoto.

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There are no physical bitcoins,
only balances associated

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with public addresses.

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The balance of
each address can be

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viewed on the public
blockchain, which keeps

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track of all transactions.

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Each address has an
associated private key,

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which is used to
authorize transactions.

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The key should be known
only to the owner.

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Bitcoin can be
bought on exchanges.

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It is legal in the United
States and most countries.

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However, Bitcoin regulation
is not yet well formed.

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It is accepted as payment
by some local merchants

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and online retailers.

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New bitcoins are released
through a process called

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mining.

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Anyone can participate in
mining with a computer using

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free open source software.

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The interval at which
coins are released

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is kept constant by the
network, and because

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of this, the more
miners that participate,

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the harder it is to mine.

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The amount of coins being
released at each interval

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is decreased by half
around every four years.

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The total amount
of coins released

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will approach 21 million.

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[MUSIC PLAYING]

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