Bitcoin - Brief History
Satoshi Nakamoto introduced Bitcoin in 2008 through a research-style white paper entitled Bitcoin: A Peer-to-Peer Electronic Cash System.
Bitcoin not only solved the double-spending problem, but also offered many other advantages, the anonymity of transactions being one of these advantages. It is totally anonymous to everyone that Satoshi created the system and transacted a few coins on it.
We don't know if Satoshi is an individual or a group of people in this world of social media, when we know that each individual's privacy is at stake. We have no idea who Satoshi is. Google revealed that Satoshi Nakamoto holds about $19.4 billion worth of bitcoins - but that money remains unclaimed in the Bitcoin system. Let's take a look at what Bitcoin is all about.
What is Bitcoin?
Earlier, you saw that the bank maintains a ledger that records each transaction. This ledger is privately held and maintained by the bank. Satoshi proposed that this ledger become public and maintained by the community.
The moment you make such a ledger public, several considerations would come to your mind. This ledger must be tamper-proof so that nobody can modify its entries. Since the ledger entries are publicly visible, we'll have to figure out how to keep them anonymous - you probably don't want the world to know that I paid you one million dollars.
Also, as there is only one single ledger keeping track of each and every transaction in the world, the size of the ledger would be another great concern. Providing a solution to these intricacies was not trivial and that's what I am attempting to do here to make you understand the underlying architecture of Bitcoin in simple terms.
To understand the Blockchain architecture, you must understand a few key features on which it is based. Let's start with PKI - Public Key Cryptography.