Bitcoin basics

In short · 5 points

1. 01Bitcoin is a digital money system without a middleman: payments go directly from person to person, with no bank or company in between.
2. 02‘Bitcoin’ means the network, BTC the unit. 1 BTC can be divided into 100 million satoshis (sats).
3. 03The supply is capped at just under 21 million BTC; over 95% of it has already been issued.
4. 04Nobody controls Bitcoin on their own. Thousands of nodes check the rules; anyone who changes them unilaterally ends up on a chain of their own.
5. 05Bitcoin is not legal tender in Germany, has no deposit protection and its price swings sharply.

In short · 4 points

1. 01The blockchain is a public ledger. Roughly every ten minutes a new block is added, and each one refers to its predecessor.
2. 02A transaction spends earlier amounts and is signed with the private key. Anyone can check the signature without knowing the key.
3. 03Nodes check every transaction and every block themselves. Miners build new blocks and have to prove computing work to do so – they don’t set the rules.
4. 04What counts is the valid chain with the most computing work. The more blocks follow your payment, the more secure it is.

In short · 5 points

1. 01One bitcoin consists of 100,000,000 satoshis (sats for short). The blockchain itself only counts in sats.
2. 02‘One bitcoin is too expensive’ is a fallacy: you can buy any fraction, even for $10.
3. 03Converting: sats = dollars ÷ price × 100,000,000. At an example price of $80,000, that’s 1,250 sats per dollar.
4. 04Your number of sats stays the same; their dollar value fluctuates with the price.
5. 05With small amounts, fixed fees weigh heavily, and tiny amounts below the dust limit can hardly be sent on the blockchain at all.

In short · 5 points

1. 01On 31 October 2008, Satoshi Nakamoto published the whitepaper; on 3 January 2009, the first block was created.
2. 02At the end of 2010, Satoshi withdrew. Since then, an open community has developed Bitcoin – with no founder at the top.
3. 03The bankruptcy of Mt. Gox in 2014 showed how risky it is to leave bitcoin sitting on a platform.
4. 04Disputes over the rules led to splits such as Bitcoin Cash (2017) and BIP-110 (2026). Bitcoin itself carried on each time.
5. 05An experiment among cryptographers became a topic for governments and securities regulators, for example with the US spot ETPs in 2024.

In short · 5 points

1. 01The whitepaper ‘Bitcoin: A Peer-to-Peer Electronic Cash System’ was published on 31 October 2008: nine pages, twelve sections, eight references.
2. 02Core idea: a peer-to-peer network prevents double spending by putting transactions into a fixed order with computing work (proof of work) – no bank in between.
3. 03The chain with the most computing work counts. Playing by the rules is meant to pay off more for miners than cheating.
4. 04Not in the whitepaper: the 21 million, the halving and the word ‘blockchain’.
5. 05The original and translations into many languages are freely available on bitcoin.org.

In short · 5 points

1. 01Miners try out vast numbers of values until the block header’s hash falls below a target. Finding the solution is expensive; checking it costs almost nothing.
2. 02Every 2,016 blocks, each node adjusts the difficulty so that a block is found every ten minutes on average – however much computing power takes part.
3. 03Whoever mines a block receives new bitcoin plus the fees. The new amount halves every 210,000 blocks, roughly every four years.
4. 04Most miners work in pools; in the month to 28 September 2026, the three largest found around 60% of blocks.
5. 05At German household electricity prices, mining costs more in power than it earns.

In short · 5 points

1. 01Bitcoin has no account balances, only individual ‘coins’ (UTXOs). A transaction spends them in full and creates new ones – usually including change back to you.
2. 02The network fee depends on the transaction’s size in vbytes, not on the amount. The fee rate is measured in sat/vB.
3. 03Unconfirmed transactions wait in the mempool. Every further block adds security; for large amounts, six confirmations are the usual guideline.
4. 04If a payment is stuck, RBF (raising the fee) or CPFP (a follow-up transaction with a high fee) can help.
5. 05Confirmed transactions are irreversible. Check the address and amount before sending.

In short · 5 points

1. 01A full node checks every block and every transaction itself – including the cap of 21 million BTC.
2. 02Miners propose blocks, nodes decide whether they are valid. Whoever enforces different rules splits off – as happened with BIP-110 in August 2026.
3. 03Coin Dance counts just over 25,000 publicly reachable nodes, around 83% running Bitcoin Core and 17% Bitcoin Knots (as of September 2026). Unreachable nodes are not counted.
4. 04Note: Bitcoin Knots from version 29.4.1 (2 September 2026) follows the split-off BIP-110 chain with its own mining algorithm, not the chain used by exchanges and wallets.
5. 05Your own node runs on a mini PC or Raspberry Pi with a large SSD. It brings independence and privacy, but no money.

In short · 5 points

1. 01A soft fork makes the rules stricter and stays compatible with old nodes. A hard fork loosens or changes them – anyone who doesn’t follow ends up on a different chain.
2. 02A fork is a different currency: despite the name, Bitcoin Cash & co. are not Bitcoin.
3. 03In the block size war, the soft fork SegWit prevailed in 2017; supporters of larger blocks split off with Bitcoin Cash.
4. 04Since 2023, there has been a dispute over data in the blockchain (Ordinals, OP_RETURN). The soft-fork attempt BIP-110 ended in August 2026 in a split that hardly anyone uses.
5. 05If the chain splits: keep your bitcoin in self-custody, send nothing until replay protection is clear – and never enter your seed phrase into ‘claim’ tools.

In short · 4 points

1. 01Lightning is a second layer on top of Bitcoin: two parties open a payment channel and shift balances within it as often as they like – only opening and closing end up in the blockchain.
2. 02Through routing, you can also reach recipients without a direct channel. The payment either goes through completely or not at all.
3. 03Lightning is suited to small, fast payments. Savings belong in self-custody on the blockchain.
4. 04Limits: Lightning wallets are hot wallets, channels need monitoring and liquidity, and large amounts are more likely to fail.

In short · 5 points

1. 01New bitcoin are created only as a block reward. It started at 50 BTC in 2009 and halves every 210,000 blocks, roughly every four years.
2. 02So far there have been four halvings (2012, 2016, 2020, 2024). The fifth follows at block 1,050,000, probably in spring 2028.
3. 03More than 95% of all bitcoin have already been issued. Because of rounding, at most 20,999,999.9769 BTC will exist; the last satoshi arrives around 2140.
4. 04The limit is enforced not by a company but by every node. The 2010 overflow bug showed this.
5. 05Whether halvings move the price is disputed. Four events are no basis for a forecast.

In short · 5 points

1. 01Your private key is a huge random number. Whoever knows it can control the associated bitcoin.
2. 02The public key and the address follow from the private key – in that direction only. Calculating backwards is practically impossible with today’s technology.
3. 03The seed phrase (usually 12 or 24 words under BIP 39) is the backup for every key in your wallet.
4. 04Addresses start with 1, 3, bc1q or bc1p. They all work; the bc1 formats catch typos better and are cheaper than 1… addresses.
5. 05No legitimate party ever asks for your seed phrase – no support team, no exchange, not us either.