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BITCOIN
It is a digital cryptocurrency.
No one controls it.
Satoshi Nakamoto, a software developer, proposed bitcoin, which
was an electronic payment system based on mathematical proof.
Bitcoin Mining
Unlike physical currencies, bitcoins are not minted they are mined.
Bitcoin mining can be thought of as a solving a particularly complex
problem of a specific difficulty level, which yields a bitcoin in the end.
Bitcoin nodes use the block chain (a public ledger of all transactions)
to distinguish legitimate Bitcoin transactions from attempts to respend coins that have already been spent elsewhere.
Every two weeks, a new target is set for the total number of bitcoins
being mined, which is determining factor for the difficulty of said
mathematical problem.
Is bitcoin legal?
Bitcoin has not been made illegal by legislation in most jurisdictions.
However, some jurisdictions (such as Argentina and Russia) severely restrict
or ban foreign currencies, thus like other currencies, it can not be used
there.
Regulators from various jurisdictions are taking steps to provide individuals
and businesses with rules on how to integrate this new technology with
the formal, regulated financial system.
e.g. Fincen, a bureau in the United States Treasury Department, issued a
non-binding guidance on how it characterizes certain activities involving
virtual currencies.
India has no written policy on Bitcoin control and regulation, though
people are discouraged from buying or selling bitcoins.
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