Over the course of 2017, the price of 1 BTC shot up from $963 to $19,694. Similarly, the price of 1 ETH rocketed from $8 to $747. Since that time, the price of Bitcoin and Ethereum has dropped significantly, but at the time would-be investors and enthusiasts were going crazy for crypto.
But aren’t cryptocurrencies just virtual money? What’s the difference between these two? And why is there still so much interest even after the massive price drops? This article will answer all of those questions and more.
How Bitcoin Works
Bitcoin is a digital currency that aims to be:
- Decentralized (no organization controls the creation or flow of the currency)
- Anonymous (one’s ability to make transactions isn’t tied to identity)
- Transparent (all transactions can be viewed by anyone at any time)
All of this is possible through the blockchain and peer-to-peer networking.
The Bitcoin blockchain is just a file that keeps tracks of all valid Bitcoin transactions ever made. Every 10 minutes, all new transactions are recorded together in a block and then added to the end of the file.