Use 8 questions to test whether you are a real Bitcoiner

At the end of 2008, the world's monetary system was in danger, and some computer experts began to look for digital solutions. Along with the bankruptcy of Lehman Brothers came a completely digital medium of exchange based on mathematics - Bitcoin.

A few months later, the white paper was released, and Bitcoin was already quietly in motion. Just like the early days of the Internet, Bitcoin's early adopters were mostly computer geeks and high-IQ criminals, followed by speculators. Its image as "digital gold" was first tarnished by online drug markets such as Silk Road and financial thefts such as Mt. Gox, which then caused its price to collapse.

This year, Bitcoin has grabbed headlines again. Its price hit a new high in March as traders speculated that the U.S. Securities and Exchange Commission (SEC) might approve a Bitcoin ETF. On March 10, the SEC announced the result, which surprised everyone. At the end of March, the SEC rejected another ETF application again for the same reason, namely that Bitcoin trading and markets lack transparency and supervision. But the price of Bitcoin still remained above $1,000.

Even without an ETF, investors are drawn to bitcoin’s price action, believing the cryptocurrency has found its footing as it approaches its 10th birthday. Last year, five major banks, including JP Morgan Chase, Barclays and Citigroup, tested equity derivatives trading using bitcoin’s underlying technology.

But how much do you know about this highly anticipated currency? Let’s start with the questions:

1. Which of the following is a correct description of the term Satoshi Nakamoto?

A. Pseudonym of the creator of Bitcoin

B. A Canadian computer engineer who may have been involved in the creation of Bitcoin, but who denies it

C. A group of computer scientists who jointly initiated the Bitcoin project

D. No one knows, but all of the above are possible

Answer: D
(One of the most interesting aspects of Bitcoin is that no one person claims sovereignty over it. Unlike Wall Street CEOs and hedge fund managers, Bitcoin’s creator has always chosen to communicate publicly under a pseudonym. Many people have been pointed out as Satoshi Nakomoto, but there is still no final conclusion. In addition, the name "Satoshi Nakomoto" has not appeared on social platforms for a long time.)

2. In the context of Bitcoin, what is blockchain?

A. Companies that own Bitcoin

B. Bitcoin Software

C. A gold necklace (what the hell?!!)

D. A timestamped ledger of all Bitcoin transactions

Answer: D
(Whatever the ultimate value of Bitcoin, the concept of blockchain will be the most significant innovation in the financial field in decades. Blockchain is an international business machine, known as a "shared distributed ledger." Compared with other forms of transaction settlement, blockchain's advantages are reflected in two aspects: transparency and automatic adjustment mechanism. Blockchain is like a variety of Excel spreadsheets that anyone in the office can access and use. Every Bitcoin transaction can appear in the blockchain ledger, and the sender, receiver and transfer amount will be recorded.)

3. According to the white paper released by Satoshi Nakamoto in October 2008, what is Bitcoin composed of?

A. Digital Signature

B. Internet Cloud

C. Pixels

D. Silicon

Answer: A
(Buying Bitcoin is like buying two numbers. One is the private key, which only you, the Bitcoin holder, know; the other is the public key, which is your wallet address, just like a PayPal address. Your public key appears in your transactions and proves that the transaction has been stored on the blockchain. When you send Bitcoin, you must sign the transaction with your private key.)

4. Which of the following investments or indices performed best in 2016?

A. S&P 500

B. CoreCivic's shares in the detention center (hmm... no problem)

C. Bitcoin

D. Copper

Answer: C
(Bitcoin's price trend over the past five years has been very tortuous, from a slow increase to a peak in 2014 (about $1,200), then fell to $170 between 2015 and 2016, rebounded at the end of 2016, and exceeded $1,300 again this year. In 2016, Bitcoin may be the best performing asset in the U.S. financial sector.)

5. Who initiated the Bitcoin ETF that was recently rejected by the SEC?

A. Mark Zuckerberg

B. Satoshi Nakamoto

C. Cameron and Tyler Durden

D. Tyler and Cameron Winklevoss

Answer: D
(The Winklevoss brothers have made a big bet on Bitcoin and Bitcoin projects. The twin brothers submitted an application to the SEC as early as 2014, and submitted several draft plans, promising to open Bitcoin investment business to the public-ETF can be open to investment in the way of mutual funds, pension funds and hedge funds. On March 10, the SEC rejected the Bitcoin ETF application, believing that the industry still needs further regulation. Jesse Powell, CEO of Bitcoin exchange Kraken, said: "It seems that they have pushed the ETF into a contradictory situation. In order for Bitcoin to be traded on a regulated exchange, it must first pass the application of such a regulated exchange.")

6. What is the Bitcoin Investment Trust (GBTC) and what happened after the SEC intervened?

A. The Winklevoss Twins’ Next ETF

B. Funds similar to ETFs are traded through OTC on the Pink Sheet Market (a service that provides trading quotes for securities of unlisted companies)

C. Exchange-traded bonds traded on NASDAQ

D. Warren Buffett's Bitcoin Company

Answer: B
(An interesting thing happened after the SEC rejected the Bitcoin ETF: As many people predicted, the Bitcoin Investment Trust is operating more and more like an ETF. The fund circumvented SEC regulation and traded in an unconventional way: initial shares were only granted to high-net-worth investors, and they had to hold the shares for 1 year before they could buy and sell them on the pink sheet market. This structure caused a mismatch between the price of Bitcoin and the price of the fund's shares. However, given that this trading model existed before the Winklevoss brothers' ETF application, the gap between the coin price and the corresponding stock price has gradually narrowed.)

7. What does the Bitcoin term hard fork mean?

A. 10,000 BTC

B. Possible Splits of the Bitcoin Network

C. A way to store Bitcoin

D. A German method of preparing potatoes that is difficult to eat with a fork (black question mark face???)

Answer: B
(Michael Moro, CEO of Genesis Trading, said everyone in the bitcoin network wants to be able to change the software to speed up transactions, which have slowed due to increased demand. Moro said the community is divided over how to achieve this goal. Miners, independent programmers who solve the mathematical puzzles in bitcoin transactions and verify them, want to unilaterally upgrade the bitcoin software so that they can process more transactions at the same time. Software developers and bitcoin users and holders want to solve the problem another way so that miners don't get too much benefit from it. If a unilateral upgrade is carried out, Moro said, "you have to download a new version of the bitcoin software, and if you don't do that, you are basically creating another bitcoin." This approach could cause a split in the currency with a market value of more than $20 billion.)

8. If the Bitcoin market continues to develop at its current pace, what will happen in 2140?

A. The Winklevoss brothers will become the richest people in the world

B. Bitcoin will cease to function

C. Miners will start their own ETF

D. Miners mine the last Bitcoin

Answer: D
(When Nakamoto created Bitcoin, he capped its number. To prevent Bitcoin miners from jeopardizing the currency’s value, the reward for miners solving a “mathematical puzzle” in a block is halved every four years. The current reward for each block is 12.5 BTC. After 123 years, the reward will be completely exhausted.)