14th April, 2021
So, you’ve heard people talk about Bitcoin. Maybe you saw a news story on TV about Bitcoin and want to learn more about it.
Well, you’ve come to the right place. This guide to Bitcoin will tell you everything you want to know about this cryptocurrency.
What is Bitcoin?
Bitcoin is the world’s most adopted cryptocurrency. It’s a virtual or digital currency that allows people to directly and securely send digital money over the internet.
The introduction of this currency followed the crash in the housing market in January 2009.
This cryptocurrency promises its users low fees for transactions compared to traditional payment methods.
It also uses a decentralized authority. And that’s what makes it different from government-issued currencies. Bitcoin users don’t have physical coins. Instead, they have balances on the public ledger.
People use crypto wallets to store Bitcoins. And they protect their wallets with private keys.
Who Created Bitcoin?
Satoshi Nakamoto created Bitcoin. People attribute this name to a pseudonymous team or person as outlined in a white paper released in 2008.
According to this paper, Bitcoin is a simple concept. It’s a form of digital money that allows users to complete peer-to-peer transactions securely over the internet.
Nakamoto came up with intertwined concepts. These are the blockchain ledger and Bitcoin private key.
When a person has Bitcoin, they control it via a private key. A private key comprises random letters and numbers for unlocking virtual vaults with the purchase.
The virtual public ledger known as the blockchain tracks every private key.
How Bitcoin Works
Every Bitcoin exists as an electronic file found in a digital wallet. A digital wallet has an app that a person can access from a computer or a smartphone.
A person can transfer Bitcoins or a part of them to and from a crypto wallet. That means you send somebody Bitcoin the same way you send an email.
The public ledger, or blockchain, records all Bitcoin transactions. That way, Bitcoin users can easily trace Bitcoins’ history. As such, a person can’t spend tokens they don’t own, undo transactions, or make copies.
How Do You Get Bitcoin?
You can get Bitcoin in three primary ways, these are:
• Buy Bitcoin: You can use a crypto exchange or a trading platform like the bitcoin champion to purchase Bitcoin using fiat money. Such a system makes finding a person selling Bitcoin easier. You can also make money trading Bitcoin on the platform. And you can do that without holding the cryptocurrency.
• Receive Bitcoin payments: You can also provide services or sell items and receive Bitcoin payments. That means you have to open a digital wallet account to get a Bitcoin address. When people want to send your Bitcoin, you give them your address or QR code to scan and send you crypto payment.
• Mine Bitcoin: Bitcoin mining was initially the only way to get this cryptocurrency. It entails solving complex math problems or equations to verify Bitcoin transactions. The Bitcoin network rewards the miners with tokens for every crypto transaction they validate.
How Safe Is Bitcoin?
The Bitcoin network records all transactions on a public ledger. That means Bitcoins are difficult to copy or even create fake coins.
What’s more, you can’t send coins you do not own. You can delete your tokens, lose them, or even lose your wallet.
People have also lost Bitcoins on crypto exchanges or sites that allow them to purchase and store the cryptocurrency.
However, no hacker has succeeded in infiltrating the Bitcoin network. But this doesn’t make it impossible to hack.
Bitcoin’s value has also been fluctuating since 2009. Nevertheless, some people have made good returns from their Bitcoin investments.