Cryptocurrency is a type of digital currency protected from counterfeiting, which can be stored in electronic wallets, as well as transferred from one wallet to another. At first glance, cryptocurrencies look like ordinary electronic payment systems, but in fact they have a number of fundamental differences, the main of which is their peer-to-peer architecture (P2P), i.e. the entire system that ensures transactions and stores information about them is based on a decentralized computer network and absolute equality of participants. It does not have a single center, and the database is duplicated for all users using cryptocurrency. Thus, many computers with crypto-wallets around the world form a giant automatic electronic system working around the clock. Another difference is the special principles and methods of encryption used in the issuance and accounting of cryptocurrencies.

   The functioning of the cryptocurrency is determined only by the correctness of the algorithm embedded in the program, and there are no organizations or persons responsible for this. If the user made a mistake and incorrectly indicated the addressee, then it is impossible to withdraw the funds back. If the user erased his crypto wallet without making any backups, then there is no way to return the money to him. There is only a clear algorithm that works reliably, and it does not forgive mistakes to the user.

   For the first time, cryptography for the purpose of confidential payments began to be used back in 1990 in David Chom's DigiCash system\[1\], but this system was centralized. The use was short-lived, as the company soon went bankrupt. The term "cryptocurrency" began to be used after the appearance of the Bitcoin payment system (Bitcoin), which was developed in 2009. Later, other cryptocurrencies independent of Bitcoin appeared, such as Namecoin, Litecoin, PPCoin, Novacoin. Subsequently, many others were created, but most of them either do not carry anything new, or are an exact copy of Bitcoin at all. Within the framework of the conducted research, we will answer a number of key questions related to the creation, use and prospects for the development of the Bitcoin cryptocurrency.

  So, what is Bitcoin? Bitcoin is a peer–to-peer electronic cash system using the digital currency of the same name, which is often referred to as a crypto currency or virtual currency.

  Who invented Bitcoin? In 2008, a person or group of persons under the pseudonym Satoshi Nakamoto published the source code and a description of the principles of the Bitcoin Network. According to Satoshi, Bitcoin was created so that anyone could independently manage their funds without interference from third parties. After the project was supported by communities around the world, Satoshi stopped taking any part in the project.

 What advantages does Bitcoin have? Firstly, decentralization. This means that there is no single management center in the network that would store information about the balance on wallets and a list of transactions. This information is stored on the computers of ordinary bitcoin owners. After installation, the wallet program downloads from other users of the system a complete database of all transactions ever made, that is, the information cannot be lost or distorted.

 Secondly, anonymity. Anonymity of the transaction is achieved due to the fact that bitcoin wallets do not have the usual usernames and passwords, and it is also not required to specify any kind of personal data of the sender and recipient of funds. The wallet consists of a public identifier, conditionally it can be called a login, a balance and a private key. To make a transaction, you only need to know the public identifier of the recipient. The process of creating a wallet is the generation of a random private key, which is responsible for a cryptographic function called hashing. When a user loses access to his wallet, the funds contained in it fall out of circulation. The lost bitcoins still remain in the global history, just like all the others, however, they will remain motionless forever, because there is no way to pick up a private key. According to the law of supply and demand, the fewer bitcoins are available, the more those that remain in circulation will be valued.

  Thirdly, the lack of a single issuing center. It is known that the issue of US dollars can be limited only by legislation, while they are not secured by anything, since the gold standard was abolished in 1933, and it can be assumed that now their value is held mainly by the authority of the United States on the world market. The total number of bitcoins that will ever enter circulation is 21,000,000 pieces. At the same time, do not worry that there will not be enough for everyone: each bitcoin can be divided into 100,000,000 shares, one such share is called 1 Satoshi, in honor of the creator of bitcoins.

  The process of issuing bitcoins is regulated automatically in such a way that a limited and predictable number of coins is always created, proportionally divided between those who give the computing power of their computer to maintain the network and protect transactions. At the moment, more than 13.5 million bitcoins have been released into circulation, and all bitcoins will be fully released by the end of 2025, while the number of virtual coins issued is decreasing every day.

  

THE MOST IMPORTANT: Remember one thing, all this is just a theory, but it will never work without practice, and if you think when it's better to start, then it was better to start 5 years ago, and now you already need to catch up with people who have been in this field for a long time!