Why was Bitcoin Created?

The 2008 financial crisis was a global awakening to the realities of traditional financial systems. Banks were failing and governments were bailing out institutions which put a spotlight on inflation, bank runs, and excessive central control of money. The desire for a decentralized currency became apparent and the unknown creator (or group), Satoshi Nakamoto, developed a form of money that could not be controlled by any single authority. The peer-to-peer transactions don’t require banks and are enforced by a decentralized network of nodes (computers). 

In October of 2008, Satoshi Nakamoto published “Bitcoin: A Peer-to-Peer Electronic Cash System”. The white paper (https://bitcoin.org/bitcoin.pdf) outlined a system that allowed people to make transactions directly online without the use of banks, creating a trustless system, enforced by software rather than people. This decentralized network means that it can be self-regulating and removes the need for any particular governing body to grant access or control it in any way, and allows individuals to rely solely on the mathematical protocol. Bitcoin’s fixed quantity also makes it a more predictable alternative to fiat money (the physical currency given value by government decree) that can easily be printed by governments. The supply and issuance of Bitcoin are publicly known, unchangeable, and designed to be stable and transparent. 

However, the idea of electronic cash (E-Cash) has been theorized and worked on long before 2008. The earliest theories of E-Cash came from Henry Ford or Nikola Tesla. Both Ford and Tesla asserted the need for a currency outside of government control, and in a digital form. However, the first paper referenced in the Bitcoin white paper was cited all the way back in 1957 by Feller. From then the idea of cryptocurrency was ideated and iterated on until Satoshi Nakamoto put all the pieces together and created the first E-Cash in the form of Bitcoin.

Bitcoin was created after decades of theorizing, experimenting, and creating. Bitcoin was born out of a financial crisis, created by centralized banking, fiat systems, and corruption with the main intent of bringing financial power and freedom back to the everyday person in the form of E-Cash. Today, one of the most powerful features in Bitcoin is the fact that it is still being worked on. Everyday the Bitcoin Core developers, a group of decentralized, semi-anonymous, individuals continue to improve Bitcoin through Bitcoin Improvement Proposals (BIPs). After a BIP is created the whole Bitcoin network decides either to implement, or reject, the BIP through a vote. So Bitcoin will continue to improve and be relevant to the needs of its users, solving new problems as they come up.