INTRODUCTION

Bitcoin (₿) is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain.

The cryptocurrency was invented in 2008 by an unknown person or group of people using the name Satoshi Nakamoto. The currency began to use in 2009 when its implementation was released as open-source software.

How Does Bitcoin Work?

Bitcoin is built on a distributed digital record called a blockchain. As the name implies, blockchain is a linked body of data, made up of units called blocks that contain information about each and every transaction, including date and time, total value, buyer and seller, and a unique identifying code for each exchange. Entries are strung together in chronological order, creating a digital chain of blocks.

“Once a block is added to the blockchain, it becomes accessible to anyone who wishes to view it, acting as a public ledger of cryptocurrency transactions,” says Stacey Harris, consultant for Pelicoin, a network of cryptocurrency ATMs.

To understand how the cryptocurrency works, it helps to understand these terms and a little context:

Blockchain: Bitcoin is powered by open-source code known as the blockchain, which creates a shared public ledger. Each transaction is a “block” that is “chained” to the code, creating a permanent record of each transaction. Blockchain technology is at the heart of more than 10,000 cryptocurrencies that have followed in Bitcoin’s wake.

Private and public keys: A bitcoin wallet contains a public key and a private key, which work together to allow the owner to initiate and digitally sign transactions, providing proof of authorization.

Bitcoin miners: Miners – or members of the peer-to-peer platform — then independently confirm the transaction using high-speed computers, typically within 10 to 20 minutes. Miners are paid in bitcoin for their efforts.

The anonymity of bitcoin

Though each bitcoin transaction is recorded in a public log, the names of buyers and sellers are never revealed – only their wallet IDs. While that keeps bitcoin users’ transactions private, it also lets them buy or sell anything without easily tracing it back to them. That’s why it has become the currency of choice for people online buying drugs or other illicit activities.

Major Companies Who Accepts Bitcoins as Payment

1. Wikipedia

Wikipedia, the company that operates the world’s largest open-source encyclopedia, Wikipedia, accepts donations in Bitcoin. Payment is done through BitPay.

2. Microsoft

The company allows the use of Bitcoin to top up your Microsoft account. In the past, the company halted its acceptance of cryptocurrency but shortly after resumed its service.

3. AT&T

AT&T is the first major U.S. mobile carrier to provide a cryptocurrency payment option to customers through BitPay.

4. Burger King.

According to local news reports, Burger King outlets in Venezuela announced a partnership with Cryptobuyer to accept cryptocurrencies as a mode of payment.

5. KFC

KFC Canada decided to accept Bitcoin for a limited time in exchange for the “Bitcoin Bucket”. The company processed payment through BitPay and the bucket was to be delivered straight to the customer’s home address. 

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