What Is Bitcoin and How It Works

what is bitcoin

Bitcoin is a digital currency that is encrypted and functions as a medium of exchange, like cash or gold. Bitcoin was created in 2009 with the intention of being a universal digital currency that anyone could access regardless of their location, wealth, or access to financial services.

The people who created Bitcoin did so with the intention of it being a new form of money that wasn’t tied to any nation or bank. In this article we look at everything you need to know about Bitcoin, what it is and how you can invest in it. Read on to learn more…

What Is A Bitcoin?

A Bitcoin is a digital currency that is decentralized and can be sent from person to person without the use of a bank or other financial institution. You can store it in a digital wallet that you can access with a digital identity. This digital wallet will show the amount of cryptocurrency you have stored on it, the current value of crypto in your native currency, and the transaction history of your digital wallet.

A Bitcoin is a finite resource that is created by people solving complex mathematical problems through a process known as mining. It is created as a reward for this process and will be capped at 21 million coins, meaning there will never be any more than that amount of it in existence.

How Does It Work?

Bitcoin works on a decentralized ledger system that is accessible to everyone who trades and owns it. This ledger shows the amount of Bitcoins that you have, the amount that you owe, and the amount that others owe you. This ledger is stored on a blockchain, a digital ledger that is incorruptible and totally transparent.

The blockchain is a decentralized network that stores and distributes this data to every computer that is connected to the Bitcoin network. The blockchain and all of the computers that are connected to it are completely decentralized and are not owned or controlled by any government, organization, or individual person.

The network of computers that store the blockchain ledger are incentivized to do so by earning coins for their service. The blockchain ledger is totally transparent, which means that anyone who has an account can see the full transaction history of all of the accounts that are connected to the network.

what is bitcoin

Who Created Bitcoin?

The inventor of Bitcoin, known as Satoshi Nakamoto, is a pseudonym and the true identity of the person behind the name is unknown. The person or group of people who created Bitcoin remain anonymous by using pseudonyms, while also allowing their creation to be open source, meaning that anyone can review and contribute to the project.

The first concept for Bitcoin was created in 2008 after the global financial crisis, with the aim of providing financial freedom to anyone who uses it. It was released in 2009 as a form of open-source software and the first Bitcoins were “mined” in the year 2010.

Why Is It So Important?

Bitcoin is a revolutionary invention that has the potential to completely change the way that people send and receive money. At the time of writing, It is being used for peer-to-peer transfers and remittances, online purchases, and can be used as a means of investment.

The speed at which Bitcoin transactions can be made is incredibly quick, with the transfer of funds usually taking between 10-30 minutes. Transactions made with it are also incredibly cheap when compared with services such as Western Union and Moneygram, which charge extortionate amounts of money for international transfers.

How to Buy and Invest in Bitcoin

The quickest way to get started investing in Bitcoin is to sign up to an exchange and choose a wallet that you will use to store your coins. You will then need to transfer funds to your exchange account and purchase Bitcoins with your currency. Once you own Bitcoins, you can store them in a digital wallet.

3 best cryptocurrency exchangers :

Binance  – FREE $100 if you register using my link and deposit more than $50
Coinbase
Houbi 

You can also use your investment to trade on a margin or contract for difference (CFD) account, meaning you don’t have to actually own the coins to make a profit. Once you have purchased a Bitcoin and you own it, you are in possession of a totally anonymous and decentralized form of money that is not owned or controlled by any country or bank.

Final Words

Bitcoin is an incredibly volatile technology that can fluctuate up and down in price by thousands of dollars in a matter of minutes. This volatility means that these are not ideal for making purchases, with prices often changing drastically enough that you could lose money on a single purchase.

However, Bitcoin does have the potential to be a disruptive technology that could take over the global economy. Given that the value of Bitcoin has increased over 1000% in the last 2 years, it is not unreasonable to assume that it will continue to grow and become more popular.

If Bitcoin continues on its current trajectory, it is likely to eventually become the most popular form of money in the world, and it could eventually replace the dollar as the global reserve currency.

Want to learn more about bitcoin and cryptocurrencies?

Check this out:

Crypto Quantum Leap will teach you how to get rich with Bitcoin and cryptocurrencies even if you know nothing about technology.

Bitcoin For Beginners-Buy and Sell Using Bitcoin Ecourse. A step-by-step cryptocurrency video course for beginners