#### What is Bitcoin 2? [Bitcoin](https://www.coinbase.com/learn/crypto-basics/what-is-bitcoin) 2 (BTC2) is a community-centric [cryptocurrency](https://www.coinbase.com/learn/crypto-basics/what-is-cryptocurrency) that aims to enhance the digital currency space by focusing on privacy, speed, scalability, and decentralization. It is a snapshot [fork](https://www.coinbase.com/learn/crypto-basics/what-is-a-fork) of Bitcoin, meaning it was created by taking a snapshot of the Bitcoin [blockchain](https://www.coinbase.com/learn/crypto-basics/what-is-a-blockchain) and then developing a new blockchain from that point. BTC2 aims to offer nearly instant transaction verification through a second-tier Masternode network and supports private transactions through the Zerocoin [protocol](https://www.coinbase.com/learn/crypto-basics/what-is-a-protocol). It utilizes an energy-efficient custom [Proof of Stake](https://www.coinbase.com/learn/crypto-basics/what-is-proof-of-work-or-proof-of-stake) protocol, which is a type of algorithm that allows the network to confirm transactions and prevent fraud. BTC2 is not owned or governed by any single person or organization, and its network is secured by nodes all around the world by its users. #### How does Bitcoin 2 work? Bitcoin 2 operates on a custom Proof of Stake protocol, which is a [consensus mechanism](https://help.coinbase.com/en/coinbase/getting-started/crypto-education/glossary/consensus-mechanism-protocol) that allows the network to confirm transactions and prevent fraudulent activities. It also uses a second-tier Masternode network to handle transactions that can be confirmed in a second. BTC2 also implements a well-known highly-vetted protocol called Zerocoin, with many custom enhancements allowing blockchain-level transaction anonymity. This protocol provides a coin mixing service using zero-knowledge proofs to sever the link between the sender and the receiver, ensuring 100% anonymity and untraceability. This makes each coin sent using this protocol 100% fungible as it has no determinable history attached to them. #### What are the potential use cases for Bitcoin 2? Bitcoin 2 aims to be an advanced digital currency that is fast, secure, decentralized, and private. It can be used for online digital transactions that can be easily transferred all around the world with nearly non-existent transaction fees. Users can convert their money into Bitcoin 2 and hold it to earn rewards, trade it on an exchange to buy other digital currencies, or use it to buy goods or services online and offline where it is accepted. The use of Bitcoin 2's Zerocoin protocol also means that users' balances can be masked to avoid being targeted by potential thieves, making it a unique feature that nearly no other cryptocurrency currently in the market possesses. #### What is the history of Bitcoin 2? Bitcoin 2 was created as a snapshot fork of Bitcoin. Initially, all Bitcoin holders as of Bitcoin block number 507850, around February 5, 2018, received BTC2 on a 1 for 1 basis, without any action required to receive it and have it recorded in the Bitcoin 2 blockchain. The Bitcoin 2 balances, addresses, and supply were set to equal those of Bitcoin at the time of the fork. In order to prune the Bitcoin blockchain from a massive 147 GB to less than 1.5 GB, a snapshot forking method was used instead of just directly copying the Bitcoin blockchain. This allowed for faster [node](https://help.coinbase.com/en/coinbase/getting-started/crypto-education/glossary/node) creation and reduced hardware requirements for [staking](https://help.coinbase.com/en/coinbase/trading-and-funding/staking-rewards/eth-2-0-staking) nodes. The supply of Bitcoin 2 started at 16848064.795 BTC2 on the main net launch, the same as the supply of BTC on Bitcoin block number 507850.