2009

In 2009, Bitcoin started with no real value. It was a new idea that mostly tech fans liked. The first known use of Bitcoin for buying something happened in 2010. One early Bitcoin adopter bought two pizzas for 10,000 BTC.

2011

In 2011, Bitcoin price hit the same as one US dollar in February. This was a big deal for Bitcoin. By June 2011, its price shot up to about $31. But then it fell hard, dropping to around $2 by November.

2013

In April 2013, its Bitcoin price jumped to about $266. This happened because more people and the news started paying attention to it. After a drop in the middle of the year, the price went up again in late 2013. It reached about $1,200 in November. This was thanks to interest from China and Silk road marketplace, which made it even more popular.

2014-2015

From 2014 to 2015, Bitcoin price went down a lot after its late 2013 high. This drop happened partly because of problems like the Mt. Gox exchange being hacked, or China banning banks from crypto transactions. The price stayed low for most of 2015, between $200 and $300.

2017

In 2017, Bitcoin's value grew a lot. It started the year at about $1,000 and ended at nearly $20,000 in December. This big jump was because of a new trend called ICOs (Initial Coin Offerings)*, more people knowing about it, and people investing in it hoping to make money.

*An initial coin offering (ICO) is an event where a company sells a new cryptocurrency to raise money. Investors receive cryptocurrency in exchange for their financial contributions.

2018-2019

After the high in late 2017, Bitcoin's price went down again. It hit a low of around $3,200 in December 2018. For most of 2019, the price was getting better and reached about $10,000 by the end of the year.

2020-2021

From 2020 to 2021, the COVID-19 pandemic made Bitcoin's price drop at first. But it quickly got up again. It started 2021 at around $29,000. By November 2021, Bitcoin hit its new ATH (All-time high) at about $69,000.

2022

Starting in 2022, Bitcoin's price has gone up and down a lot. It happened mainly because of projects like FTX, Luna and Celsius which went bankrupt. Government interest rate rise affected BTC prices changes, too.

2023

In 2023, Bitcoin did really well. It started the year valued at $16,530. As the months passed, its price kept going up. By the end of the year, one Bitcoin was worth $42,258.

Here are the basics of Bitcoin. We'll explore its aspects, such as its decentralized nature, the underlying blockchain technology, and the Bitcoin digital asset itself.

Bitcoin is a kind of digital money. There is no big bank or one person in charge of it. Instead, it works with many people, and they send money directly to each other.

Bitcoin was made so that you can pay someone without the need of middle man, like a bank, to help. This way, it tries to make things quicker and easier than the usual way we use money.

Here's a simple breakdown:

• Bitcoin is a digital currency.
• There's no single person or bank running it.
• People send money to each other without a middleman 24/7.
• It's meant to make paying for things faster and easier.

Someone using the name Satoshi Nakamoto created Bitcoin, but we don't know who they are. There are many guesses, but no one knows for sure.

Bitcoin was first shown to the world in a document called “Bitcoin: A Peer-to-Peer Electronic Cash System” on October 31, 2008. Then, in January 2009, the first Bitcoin program was shared with everyone. This started the Bitcoin system and the creation of the very first Bitcoins.

Bitcoin is like online cash that works without a central bank. It uses a system where everyone can see all the money transactions on a list called the blockchain. This list is safe and can't be changed, making sure that once you send or receive bitcoins, the transaction is final.

Bitcoin miners use powerful computers to solve complex mathematical problems, validating transactions on the blockchain. Mining works by securing the network and issuing new Bitcoins. Miners compete to solve these problems, and the first to succeed adds a new block to the blockchain, earning Bitcoin rewards.

When you send bitcoins, the transaction goes out to the network. Miners then confirm it when they add it to the blockchain. Each time a new block is added after yours, your transaction becomes even more secure. This is how Bitcoin works to make sure your money is safe and the system is trustworthy. 

In this part, we explain how different parts of Bitcoin's system work together. They keep the network safe and make sure people can trust it.

In November 2021, Bitcoin made a big improvement with something called Taproot. This update made Bitcoin better in three ways: 

• Keeps things more private. 
• Can handle more transactions.
• Uses less space on the Bitcoin record book, which is called the blockchain.

With Taproot, when people do special Bitcoin transactions, they look just like normal ones. This is good for keeping things private. Because these transactions take up less room, more of them can fit on the blockchain. This could mean you pay less to send Bitcoin.

Taproot also helps with smart contracts. These are like automatic agreements that live on the blockchain. With Taproot, these contracts work better and are more private.

The Lightning Network is a special system that works with Bitcoin to make payments faster and cheaper. It's like a shortcut for transactions, allowing people to send money back and forth quickly without having to pay a lot or wait for the Bitcoin network to record every single payment. 

Instead, the details of these quick payments are only added to the Bitcoin network when the users are done transacting. This way, Bitcoin can handle a lot more transactions at once, including very small payments.

This overview will give you a clearer understanding of the security measures that make Bitcoin a trusted digital currency.

Bitcoin uses special codes to keep its transactions safe and to make sure new Bitcoin units are created fairly. This code is called SHA-256 and it's very secure, making it hard for anyone to mess with the system. 

Because of this, once a Bitcoin transaction is made, it can't be changed, and the record of all transactions, the blockchain, stays safe from tampering.

Bitcoin wallets use private keys that allow users to access their Bitcoin. Effective security measures also include strong, unique passwords, and two-factor authentication. If you are thinking which one to choose – hardware or software wallet, remember, that hardware wallets that store private keys offline, away from potential online threats.

However, the wallet security depends on the user itself. For this, users need to keep private keys securely and never reveal them to any 3rd party. Bitcoin technology is secure, but the security of a wallet is the responsibility of the user.

Bitcoin is like a big book of digital money transactions. Lots of computers work together to make sure no one cheats. They use proof-of-work, where miners have to solve hard math puzzles. This keeps Bitcoin safe from bad actions and attacks.

To keep the network strong, the Bitcoin software gets regular updates. This helps fix any weak spots.

If someone wants to attack Bitcoin, they would need more computer power than all the nodes and miners put together. But this is expensive to do and it’s very unlikely.

The general cryptocurrency mining process helps to understand Bitcoin mining, too. It involves using specialized computers (miners) to solve cryptographic puzzles, secure the network, and verify transactions. Miners compete to add new blocks to the blockchain. 

They earn newly mined bitcoins and transaction fees as rewards. This process needs a lot of energy but is essential for maintaining the decentralized integrity of Bitcoin.

Compilation of Transactions → Transactions are gathered into blocks by miners.

Solving Cryptographic Puzzles → Miners compete to solve puzzles that allow them to add a block to the blockchain.

Difficulty Adjustments → Bitcoin's difficulty adjustment ensures a stable block creation time of about 10 minutes by recalibrating the mining challenge every 2016 blocks, roughly every two weeks.

Securing the Blockchain → By making sure that adding to the blockchain is technically challenging and requires a lot of work, mining helps to secure the Bitcoin network by discouraging potential fraud.

Linking Blocks Securely → When a block is successfully mined and added to the blockchain, the chain's defenses against manipulation and revision are strengthened.

Transaction Fees → Miners earn fees from the transactions they include in blocks.

New Bitcoins → Miners receive new Bitcoins generated with each block, following a fixed declining rate.

Bitcoin halving is a special event that happens about every four years when 210000 blocks have been mined. It cuts the reward for mining new Bitcoin blocks in half. This key rule helps control how much Bitcoin is made and will continue approximately until year 2140. 

At first, miners got 50 bitcoins for each block they mined. But after the halving, they get half as much. So, after the first halving in 2012, the reward was 25 bitcoins per block.

The halving makes new bitcoins come out more slowly. It also makes bitcoins harder to get, which might affect their price. When there are fewer new bitcoins, the ones that are already out there could become more valuable. This is because when something is rare, people often see it as more valuable.

Every four years, miners prepare for the next halving. They know it will reduce their rewards, but it might also lead to a higher value for each Bitcoin. This event is a planned part of how Bitcoin works. It makes sure that not all bitcoins are made too quickly.

There are two effective methods for storing Bitcoin – hardware and software wallets.

A hardware wallet is a small gadget that keeps your Bitcoin safe. It works like a USB stick but is made for protecting your digital money. It's one of the best ways to keep Bitcoin secure, especially if you plan to save it for a long time. 

With a hardware wallet, a special key allows you to get your bitcoins. This keeps them safe from online dangers.

They work very simply:

Hardware wallets are like small, portable safes for your Bitcoin. Hardware wallets are different from software wallets because they don't connect to the internet. This means hackers can't get to them through the web. 

You connect the wallet to a computer or phone when using your Bitcoin. But the important thing is, your private keys never leave the wallet. This makes your Bitcoin very safe.

Software wallets are programs you can download on your phone or computer. They are handy for everyday use because you can get to them easily. But, they are not as safe as hardware wallets. This is because they are online, which means hackers and harmful software can get to them more easily.

Here's how they work:

Software wallets are like an app for your money. You can use them to pay for things or send money to people. They are good for when you need to use your digital money often.

Buying Bitcoin is straightforward:

1. First, select a reputable cryptocurrency exchange that supports Bitcoin transactions. Some well-known exchanges include Coinbase, Binance, Kraken, and Bitstamp. Each platform has its verification process.
2. Once you’ve chosen an exchange, you must create an account. This will usually involve verifying your identity with documents such as a passport or driver’s license.
3. After your account is set up and verified, deposit funds into it. Most exchanges accept bank transfers, credit or debit cards, and sometimes even PayPal. The funding method can affect transaction fees and times, so choose one that best fits your needs.
4. With funds in your account, you can order to buy Bitcoin. You can choose a market order to buy at the current Bitcoin price or a limit order to specify the price at which you want to buy.
5. After purchasing, secure your Bitcoin. While you can keep it on the exchange, using a personal wallet (hardware or software) is more secure. 

Bitcoin markets refer to the various platforms and methods where Bitcoin can be bought, sold, or traded. These include:

Cryptocurrency Exchanges 

Platforms like Coinbase, Binance, and Kraken, where users can trade Bitcoin for fiat currencies or other cryptocurrencies.

Bitcoin ATMs 

Physical kiosks found in public places allow users to buy and sell Bitcoin with cash or credit card.

Peer-to-Peer (P2P) Networks 

Platforms facilitate direct transactions between individuals without the need for an intermediary.

Futures and Options Markets 

There are special online platforms for people who want to guess what the price of Bitcoin will be later on. They use derivatives to make these guesses.

Bitcoin uses a lot of energy, which worries people about its effect on the environment. Mining Bitcoin often needs a lot of electricity, which can lead to pollution.

But some places like Ethiopia and El Salvador are different. They use the Earth's warmth to mine Bitcoin. Ethiopian Renaissance Dam offers cheap electricity for Bitcoin miners, too. 

This way, they can mine without harming the environment, and it costs less.

Upgrades to Bitcoin's technology are made through a consensus-driven process:

Bitcoin Improvement Proposals (BIPs)

These proposals are the primary mechanism for making changes to the Bitcoin protocol. To change the rules of Bitcoin, people use special plans. These plans need to be written out clearly, and many Bitcoin users have to agree before the changes can happen.

Forks

When big changes in a blockchain don't get enough support, they can lead to a fork. This creates a new, separate blockchain. For example, Bitcoin Cash and Bitcoin Gold were created this way.

Software Updates

Developers often release new software updates. They do this to fix security problems, add features, or make the network run better. The people and companies that run the network must accept and use these updates.

Bitcoin works this way, too. It's safe and can change because of this system. But it can be hard for everyone to agree on updates quickly.

When comparing Bitcoin and Ethereum, they serve different purposes and are based on different technologies.

Purpose and Vision 

Satoshi Nakamoto imagined a new kind of money that doesn't need banks. This money can keep its value and you don't need anyone else to manage your payments.

Ethereum is different. It lets you run safe programs and make deals that are set in stone. It uses its own currency, called Ether. 

Blockchain Technology 

Bitcoin's blockchain is like the backbone of the digital currency. It keeps Bitcoin running. Ethereum's blockchain does more. It not only handles its own currency, Ether, but also lets many different apps work on its system. This is thanks to something called smart contracts.

Consensus Mechanisms 

Bitcoin uses proof-of-work (PoW) system. This system needs a lot of computer power. Ethereum started with PoW too, but it is changing to proof-of-stake (PoS). PoS uses less energy, so it's better for the environment.

Transaction Speed and Costs 

Both have unstable fees.