Bitcoin
How to use bitcoin with Trezor
Overview
| Firmware support | Trezor One, Trezor Model T, Trezor Safe 3 |
| Available in Trezor Suite | Yes |
| Third-party Wallets | Electrum, Mycelium, Exodus |
Trezor was originally designed as the safest hardware wallet for holding bitcoin, with support for alternative cryptocurrencies coming in later updates. The easiest way to use bitcoin with your Trezor is via our Trezor Suite desktop application; you can also track your balances on the go with our mobile application Trezor Suite Lite. It is also possible to use your Trezor with third-party wallets such as Electrum.
Trezor Suite
Bitcoin is integrated with Trezor Suite, therefore it is possible to use it in the standard interface.- Plug in your Trezor device
- Download and install Trezor Suite; alternatively, you can use Trezor Suite for web
- Navigate to the Accounts page, and select Bitcoin in the 'My accounts' side menu
- In each of your Bitcoin accounts, you can send, receive, view, sign & verify transactions.
History
Bitcoin has several predecessors which had the same goal but weren't successful. Most of them had an impact on Bitcoin technology.
B-money
B-money was an early proposal created by Wei Dai for an "anonymous, distributed electronic cash system," according to his essay published in November, 1998. Satoshi Nakamoto referenced b-money when creating Bitcoin.
Hashcash
Hashcash is a proof-of-work system used to limit email spam and denial-of-service attacks, and it is also used in Bitcoin (and other cryptocurrencies) as part of the mining algorithm. Hashcash was proposed in 1997 by Adam Back.
Bit gold
Nick Szabo designed Bit gold in 1998, as a decentralized digital currency. Bit gold was never implemented but has been called "a direct precursor to the Bitcoin architecture". In the Bit gold structure, a participant would dedicate computer power to solving cryptographic puzzles.
Some other technological innovations had a big impact on creating Bitcoin, such as the design of a secure timestamping service with minimal trust requirements, Merkle's Protocols for public key cryptosystems, and many more.
Technology
Blockchain
A blockchain is a shared database secured by cryptography, which stores all the bitcoin transactions with timestamps that have been updated since its beginning. It is possible to distinguish it from the classic database with its immutability - it is not possible to change data already stored in it - and decentralization - the database is stored in many locations in the world so its accuracy is easy to audit. Block creation also allows bitcoin software to determine when a particular bitcoin was spent, which is needed to prevent double-spending.
Proof of work
A proof of work is a piece of data which is difficult (costly, time-consuming) to produce but easy for others to verify, and which satisfies certain requirements. Producing a proof of work can be a random process with low probability so that a lot of trial and error is required on average before a valid proof of work is generated. Bitcoin uses the Hashcash proof of work system. Hashcash proofs of work are used in bitcoin for block generation. In order for a block to be accepted by network participants, miners must complete a proof of work which covers all of the data in the block. The difficulty of this work is adjusted so as to limit the rate at which new blocks can be generated by the network to one every 10 minutes.
Mining
Mining is a record-keeping service done through the use of computer processing power. Miners keep the blockchain consistent, complete, and unalterable by repeatedly grouping newly broadcast transactions into a block, which is then broadcast to the network and verified by recipient nodes. Each block contains an SHA-256 cryptographic hash of the previous block, thus linking it to the previous block and giving the blockchain its name.
Supply
The successful miner who finds the new block is rewarded with newly created bitcoins and transaction fees. For every block new bitcoins are created, but this reward decreases in time in a previously determined process called bitcoin halving. Eventually, the reward will decrease to zero, and the limit of 21 million bitcoins will be reached in 2140.