Bitcoin 101

Former PwC Crypto leader and partner and adjunct professor at the university of Hong Kong, Henri Arslanian is the co-founder and managing partner of the crypto hedge fund Nine Blocks Capital Management. In partnership with CoinShares, he goes back to Bitcoin basics.

Bitcoin was born from an attempt to solve the “double spend” problem, ensuring that digital value cannot be duplicated the way a digital image can. On October 31, 2008, Satoshi Nakamoto released an eight-page whitepaper outlining Bitcoin, a peer-to-peer cash system enabling value transfer without intermediaries. Its supply is fixed at 21 million coins, released at a predictable rate until 2140. Like gold, Bitcoin is divisible (down to eight decimal places, the smallest unit called a Satoshi), durable, and scarce, but it has the added advantage of near-instant global transferability. This makes it highly adaptable to a digital, interconnected economy.

In this foundational section, Arslanian breaks down how Bitcoin works, demystifies common misconceptions, and explains key technical principles like mining, proof of work, and traceability. The goal is to make Bitcoin more accessible, even to those outside of tech or finance circles.

Key takeaways

• Bitcoin solved the double-spend problem without intermediaries through blockchain and the proof-of-work consensus mechanism.

• Only 21 million bitcoins will ever exist, with new coins issued in mathematically fixed intervals until 2140. No central authority can alter this supply.

• Proof of work (Bitcoin mining) is a decentralized competition to validate transactions—removing the need for a central authority or auditor.

• Bitcoin is divisible (up to 8 decimals), portable, durable, and verifiable, mirroring gold in value preservation but exceeding it in potential digital utility.

• Contrary to public myth, Bitcoin is traceable, every transaction is public, making it unsuitable for crime, despite its early associations.

• Advisors and clients can easily access Bitcoin via ETFs, making it accessible through traditional investment platforms.

• Understanding Bitcoin is increasingly seen as a fiduciary and moral responsibility in modern financial advising. The next generation—already immersed in digital worlds—will view digital money as the norm.