6 Introducing Bitcoin

Bitcoin was the first application of blockchain technology, and has started a revolution with the introduction of the very first fully decentralized digital currency. It has proven to be remarkably secure and valuable as a digital currency; however, it is quite unstable and highly volatile. The invention of Bitcoin has also sparked a great interest in academic and industrial research and opened up many new research areas. In this chapter, we shall introduce Bitcoin in detail.

Specifically, in this chapter, we will focus our attention upon the fundamentals of Bitcoin, how transactions are constructed and used, transaction structures, addresses, accounts, and mining, over the following topic areas:

• Bitcoin—an overview
• Cryptographic keys
• Transactions
• Blockchain
• Mining

Let's begin with an overview of Bitcoin.