Bitcoin

Bitcoin is a digital currency that runs on a peer-to-peer network, in which transfers are recorded on a shared public ledger instead of being processed by a bank or other trusted intermediary.

Origin

The design was set out in a nine-page paper, Bitcoin: A Peer-to-Peer Electronic Cash System, published under the name Satoshi Nakamoto. Nakamoto announced the paper on the Cryptography Mailing List on 31 October 2008, describing "a new electronic cash system that's fully peer-to-peer, with no trusted third party." The first software release followed in an announcement dated 8 January 2009 (UTC).

The network's first block, called the genesis block (block 0), carries a timestamp of 3 January 2009, 18:15:05 UTC. Embedded in it is the text "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks".

The problem it addresses

A digital file can be copied, so a purely digital coin risks being spent twice. The whitepaper calls this the "double-spending" problem and observes that online commerce has relied on financial institutions acting as trusted third parties. Its proposal is for transactions to be publicly announced and for participants to agree on a single history of the order in which they were received, so that the earliest spend of a coin is the one that counts.

How it works

Transactions are grouped into blocks, and each block includes a hash of the one before it, forming a chain (the "blockchain"). To add a block, a participant must perform proof of work: repeatedly computing a cryptographic hash (a fixed-length digital fingerprint of data) until the result meets a difficulty target. The whitepaper explains that this makes the record one "that cannot be changed without redoing the proof-of-work", and that nodes treat the longest chain, the one with the most work behind it, as the correct history. It argues the system stays secure as long as honest nodes collectively control more computing power than any cooperating group of attackers.

The reference software, Bitcoin Core, sets a target spacing of ten minutes per block and a retargeting window of two weeks, which works out to a difficulty adjustment every 2,016 blocks.

Issuance and supply

The whitepaper describes the first transaction in each block as a special one that creates new coins for the block's creator, both rewarding participants and distributing coins without a central issuer. The paper likens this to gold miners expending resources to add gold to circulation, and block creators are called miners. Transaction fees are added to the same reward.

In Bitcoin Core's code, the new-coin reward (the "subsidy") starts at 50 bitcoin per block and is cut in half every 210,000 blocks, roughly every four years. This event is known as a halving. Nakamoto's release announcement gave the expected result: "Total circulation will be 21,000,000 coins." Because the code rounds each reward down to whole units, the schedule actually sums to 20,999,999.9769 bitcoin (the sum of 210,000 × 50 bitcoin halved each era, with fractions below the smallest unit dropped). The software's own comments note that the total supply is less than 21,000,000.

The fourth halving took place at block 840,000, timestamped 20 April 2024, 00:09:27 UTC. As of November 2026, the subsidy is therefore 3.125 bitcoin per block (50 halved four times). The next halving is due at block 1,050,000.

Units

One bitcoin is divided into 100,000,000 satoshis, the smallest unit the protocol records.

Regulated investment products

On 10 January 2024 the U.S. Securities and Exchange Commission approved the listing and trading of a number of spot bitcoin exchange-traded product shares. The chair's statement added that the Commission "did not approve or endorse bitcoin."

Sources

• Satoshi Nakamoto, Bitcoin: A Peer-to-Peer Electronic Cash System, whitepaper (2008). bitcoin.org/bitcoin.pdf
• Satoshi Nakamoto, "Bitcoin P2P e-cash paper", The Cryptography Mailing List, 31 October 2008, archived by the Satoshi Nakamoto Institute. satoshi.nakamotoinstitute.org/emails/cryptography/1/
• Satoshi Nakamoto, "Bitcoin v0.1 released", The Cryptography Mailing List, 8 January 2009, archived by the Satoshi Nakamoto Institute. satoshi.nakamotoinstitute.org/emails/cryptography/16/
• Bitcoin Core source code, src/kernel/chainparams.cpp, src/consensus/params.h, src/validation.cpp and src/consensus/amount.h (master branch, read November 2026). github.com/bitcoin/bitcoin
• mempool.space block explorer: block 0 and block 840,000 (read November 2026). mempool.space/block/000000000019d6689c085ae165831e934ff763ae46a2a6c… and mempool.space/block/0000000000000000000320283a032748cef8227873ff487…
• U.S. Securities and Exchange Commission, "Statement on the Approval of Spot Bitcoin Exchange-Traded Products", Chair Gary Gensler, 10 January 2024. sec.gov/newsroom/speeches-statements/gensler-statement-spot-bitcoin…