What is bitcoin and why is it needed?
Bitcoin is a new generation of digital currency, created and working only on the Internet. Nobody controls, emission occurs through the work of millions of computers around the world with the use of computer programs.
What will happen if you ask investors and cryptocurrency experts, why do you need Bitcoin? Most likely, you will not get a clear answer with a specific definition!
Let us consider several ways of using this cryptocurrency with examples!
1. Payment of goods and services.
There are companies that conduct settlements with customers strictly in Bitcoins. As a rule, their activities do not fit into the rules of ordinary financial institutions. Since the cryptocurrency revolves in the p2p systems, those who work with it may not be afraid that their accounts will be blocked.
2. Using a bitcoin card as a debit card.
In some places, cryptocurrency users can go to an ATM and withdraw Bitcoins as if they were ordinary money. n these regions, it is also allowed to transfer money from debit bank cards to bitcoin cards. A real Bitcoin coin has already been created, but for now it remains a curious souvenir – no more.
3. Using for exchange of data and values that are not related to Bitcoin.
Blockchain tracks all transactions involving Bitcoin. If desired, you can inсlude any information in the records and use this cryptocurrency as a means of exchanging this information.
4. Application instead of fiat currency.
If you do not trust the central bank, the country has a terrible economic situation, currencies are unstable, and you don’t want to get involved in fiat currency at all – take a look at Bitcoin.
The history of Bitcoin
The history of Bitcoin begins its countdown from the second half of 2008 until the beginning of 2009.
In those days, a document describing the first cryptocurrency is published, a client is issued to work with the network and generate a genesis block, for which a reward of 50 BTC is charged. Thus, the world first heard about Bitcoin!
Despite the fact that the creator of Bitcoin is still considered unknown, many distinguish a large contribution to its development by Satoshi Nakamoto. His scientific work outlined the theoretical foundations of the digital currency, but it is not clear whether this was a pseudonym or not.
In the first years after the creation of cryptocurrency, it attracted the attention of only enthusiasts of the digital money world. Miners join the mining of coins, but they did not have much value in the eyes of most users.
How does Bitcoin work?
Anyone who is not familiar with the technical details can start using Bitcoin. By installing a bitcoin wallet on your computer or phone, you will receive your first generated bitcoin address. In the future, you can create them as much as you like.
You can share your address with friends so they can pay you or vice versa. In fact, this is very similar to how Email works, except that bitcoin addresses are used once.
How can you transfer bitcoins?
To transfer Bitcoins, you only need two things: the private key and the Bitcoin address. There is nothing in common between a bank account and a bitcoin address. To open a cryptocurrency address, you do not need to fill out a lot of papers and provide documents to identify it.
In fact, they are created arbitrarily and represent a random sequence of letters and numbers. The private key is also a sequence of letters and numbers, but unlike your Bitcoin address, it is kept secret.
Currency transfer fee
Some wallets allow you to manually sеlect the size of the commission, but in most cases it is set automatically. Any part of a transaction that the beneficiary does not take, or which is returned as a change, is considered a reward. It goes to the miner, who was lucky to solve the transaction block as an additional reward.
The optimal transfer fee depends on how many addresses are involved both at the output and at the entrance.
What is the network confirmation?
Network confirmation is the recording of a transaction in a block synchronized to the worldwide blockchain. Each data block contains a hash of the last block, as well as information to write to the next.
This gives users the opportunity to see any transaction conducted in the entire history of the system. Bitcoin transactions are confirmed by the miners, with each mined block they record information about the operations performed.
How many confirmations do you need to get or sell bitcoin?
Depends on the number of coins that the user sends in the transaction.
For a minimum currency transfer, one transaction will suffice, and for sending a large number of coins, it is recommended to confirm the transaction in at least 6 blocks for maximum reliability and security.
How long does it take to get a confirmation?
Each time the block creation speed changes. On average, it takes from 10 to 20 minutes, depending on the network load, but sometimes the time may increase. The main reasons for the long confirmation are high network load and low priorities for certain operations, for example, private transfers of a small number of coins.
Also one of the easiest ways to confirm a bitcoin transaction is faster by assigning a higher transfer fee, which increases the priority of the operation in the write queue to the block.
Where to get, buy or sell bitcoin?
4 main ways to earn Bitcoin and cryptocurrency:
- Earnings through the taps. Accessible to everyone, not difficult and does not require any skills. It is because of they pay a little, but there is still no end from those who want it. Many use dozens of similar taps at once so that the displayed amounts of bitcoins (satoshi) are more tangible.
Pros – simplicity, does not require investments. Cons – small earnings.
- Earnings through mining is another popular method based on the principle of the blockchain technology, which serves as the basis for Bitcoin cryptocurrency and many others.
Pros – profitable when Bitcoin rises in price. Cons – requires considerable investment and is not clear the prospect of this kind of earnings.
- Speculation on the stock exchange cryptocurrency – bought cheaper, then sold at a higher price or vice versa. The rate of cryptocurrency is constantly growing and it encourages many to invest in btc and other currencies. Just selling them after a week or a month you can earn good money.
Pluses – money out of thin air. Cons – complexity, we need initial investments.
- Perform any tasks freelance cryptocurrency. Bitcoin is slowly becoming a payment unit, which, compared to other methods, sometimes has a number of significant advantages. For example, this is complete anonymity and the absence of problems with transfers to other regions of the world.
Pros – do not need investments. Cons – not everyone is ready not such a method of payment.
3 main ways to buy Bitcoin and cryptocurrency:
- Bitcoin exchangers. These are conventional online exchangers, where a number of exchange directions are supported, including cryptocurrency. The advantage of this method is ease of purchase. The disadvantage is not always favorable rate.
- Cryptocurrency exchanges. Classic exchanges, where you can not only make money on speculation, but also buy bitcoins at a favorable rate. Unlike exchangers, you are dealing with hundreds or even thousands of people like you, which means that the chance to find a course that suits you is greatly enhanced.
Pros – you can save on the purchase. Cons – difficult and always profitable.
- Buy from another person. There are services that operate on the principle of P2P, which simply reduce the seller and buyer of cryptocurrency, and they themselves buy or sell online (the service acts as a guarantor of such a transaction) or in person (the service does not bear responsibility here). A prominent representative of this kind of services is LocalBitcoins.
Do not be afraid to work with new currencies! Earn, buy and sell Bitcoins! Makoli online exchanger will help you quickly exchange bitcoins for the cryptocurrency you need or buy the required number of coins at a favorable rate
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