Beginners GuideInformation

What is Bitcoin?

Might be you are new in this crypto space or maybe you just heard about crypto and btc a few weeks ago and felt like it’s too late to get in the game? No worries, I have gathered all the necessary information and represented in the form of detailed guide.

Basically, Btc appears different to different people. For a few, it is a future of freely moving currency linked to any central bank. Whereas for others, it is a purely digital entity of questionable value and uncertain origin.

What Is Bitcoin?

Bitcoin is a cryptocurrency or a digital currency which is used and distributed electronically. It is a decentralized peer-to-peer network. No single institution or person controls it. The coin uses protocols of cryptography for regulation and generation of units of currency. Btc falls under the top cryptocurrency and it was first most valuable coin among them.

Who Created Bitcoin?

The term bitcoin was first introduced in a white paper in 2008 by Satoshi Nakamoto.

The creator of Btc is still unknown. Basically, Satoshi Nakamoto is a pseudonym that may represent a person or a team.

It sounds weird, right? But yes!! It’s true, the world knows only one name behind this revolutionary cryptocurrency i.e. btc. There is no exact information about the founder of Btc. It’s still a mystery whether Satoshi Nakamoto is the name of individual or group.

The basic idea behind Btc came to light when peer-to-peer networking and cloud computing emerged in data storage and management. Previously, the security and maintenance of such networks were handled by huge corporations which were looking to make a profit. Bitcoin’s documentation, on an abstract level, was a proposal to transfer the maintenance work and security to external, anonymous crowd contributors. And thus, bringing about a decentralized and democratic shift in these industries.

How Does Bitcoin Work?

Now, when you know what is bitcoin? You might be eager to know how exactly the coin works. Well, here you go… Let me elaborate in a simple and easy way!!

So, each BTC is basically a computer file which is stored in a digital wallet app on a computer or smartphone.  You can send BTC to your digital wallet, and/or you can send BTC to other people. Normally, every single transaction is recorded in a public list called blockchain. Thus, this helps in tracing the history of Btc to stop people from spending coins they do not own, making copies or undoing transactions.

How To Earn Bitcoin?

Here are the top 2 accepted ways to earn bitcoin.

Trading: One of the quick and simplest ways you to earn btc is by trading it on an exchange. Basically, you’re trying to purchase Btc when its price is low and sell it when the price increase.

Affiliate programs: One of the most overlooked ways to earn Btc is by promoting various affiliate programs. Basically, affiliates are people who promote certain business for free but receive a commission if they manage to bring in paying customers. Many Bitcoin exchanges, products, and services have an affiliate program in which you can enroll.

Owning a faucet: While participating in a faucet you might not earn, instead of owning your own faucet is profitable. At present, you can build a cryptocurrency faucet quite easily and earn btc from selling ads on your site.

Gambling: An obvious way to increase your crypto wealth is by gambling it using one of the various Btc casinos out there. But before entering make sure the casino you are using is probably fair.

Anyways, there are plenty of ways to earn bitcoins. Now you know how to get Bitcoin. Next, all you need to do next is decide which way is best for you. Choose a service that you feel comfortable using.

Bitcoin Transactions

Well, when you earn a few bitcoins, it is very much necessary to understand how to transfer it or how exactly the btc transaction works.

Here are a few simple steps which help you understand the entire process.

  • First and foremost,  you need a btc address which is basically a sequence of numbers, letters and a private key. The address is public but the private key is secret.
  • Public Cryptographic Key: It refers to your account number. The way someone would send money to your bank account via your account number. Similarly, your public cryptographic key is the information you give to the sender to receive cryptos to your wallet.
  • Private Cryptographic Key: It is the key which allows you to spend your Bitcoins and other cryptocurrencies. If someone has access to it, they can easily steal your btc.
  • You need to send your bitcoin address to the sender who then signs a transaction using his or her private key.
  • The sender will then send bitcoins to the btc network for verification.
  • Once the transaction is verified, it is recorded in the blockchain or ledger as your balance increases.

How To Create Bitcoin?

New bitcoins are created through a decentralized process called ” Bitcoin mining“. Bitcoin miners are securing the network using specialized hardware and are collecting new bitcoins in exchange by processing transactions. The Btc protocol assures new btc are created at a fixed rate, making the process of bitcoin mining a competitive business.

How To Invest In Bitcoin?

If you are ready and excited to purchase Btc, Here are the necessary components to start investing in Bitcoins:

  • An exchange or website to buy Btc
  • A wallet where you can store Btc

These two are the main entities to get started with. You need to understand and research about the wallet or exchange before you invest, or you might fall prey to some scam, resulting in a loss.

Well, the process to invest in btc is quite simple. Here you go…

  • Initially, you need to quickly sign up for with appropriate exchanges and transfer money from your bank account to purchase Bitcoins. However, few exchanges offer an app that acts as an exchange and a wallet.
  • Through the app, you can both buy and trade Bitcoins as well as store them. If you use the Coinbase exchange, it doesn’t mean you have to use the Coinbase digital wallet. You can opt for any wallet of your choice.
  • Once you sign up in an exchange, you can notice a buy section. Select the amount of btc you want to buy.
  • However, you can buy less than one Bitcoin on these exchanges. Bitcoin can be divided up to eight decimal points. This means you can buy 0.5 Bitcoins, 0.02 Bitcoins, or even 0.00000001.
  • Based on the exchange, you can buy Btc with a credit card, bank transfer, or even cash.
  • Later, to store Btc, you need a wallet. If you search online for Btc wallets, you come across plenty of options. Make sure you choose a best and trustworthy wallet by checking the reviews and comparing different Wallets.

How To Store Your Bitcoins?

With the emergence of BTC and other cryptocurrencies, hackers see new potential for thefts. So if you’re just getting into bitcoin, you’re probably worried about storing your btc in a safe and secure way. So, How do you keep your digital investments safe?

Here are the best ways to store your bitcoins.  

  1. Exchange platform: Here, you trade money for cryptocurrencies such as Bitcoin, Ethereum, or Litecoin. You can also trade one cryptocurrency for another.
  2. Wallet platform: Basically, it’s a bank account where you can store your cryptocurrencies.
  3. Hard wallet: It’s an offline wallet that is not linked to a network.

Advantages of Bitcoin

Private and Anonymous: Bitcoin purchases are anonymous. Unless a user voluntarily discloses his Btc transactions, his purchases are not linked to his personal identity. However, the anonymous Btc address generated for user purchases changes with every transaction.

Very Low Transaction Fees: Compared to another digital payment mode, like PayPal and credit cards, Bitcoin comes with lower transaction fees. Though the fees are variable, it’s rare for a Btc transaction to cost more than 1% of its value.

Control and Security: As personal information is kept hidden from hackers, Btc protects against identity theft. It can be encrypted and backed up to ensure the safety of your money.

Quick payments: Transfering bitcoins across the globe is as easy. Unlike traditional banking, there is no need to wait 2-3 business days, no extra fees for making an international transfer, and no special limitations on the minimum or maximum amount you can send.

No Third-party Interruptions: Banks, Governments, and many other financial intermediaries have no rights to interrupt user transactions or freeze Bitcoin accounts. However, The system is peer-to-peer, users can experience a great degree of freedom than national currencies.

The Future Of Bitcoin

So what’s next for Bitcoin? As outlined before, it has huge benefits and for this reason, it will remain relevant as a currency. However, it is evident that Bitcoin is gaining lots of hype around the globe. Btc is under frequent development and implementation. The future roadmap has some interesting concepts that shall prove vital to the sustainability of the network and its narrative direction.

One of the major trends to watch closely over the coming years is the development of Bitcoin’s Lightning Network.  This development could allow Bitcoin to operate as a P2P payment system and high-value settlement layer concurrently.

Bitcoin, and its operational technology, the blockchain, have a future in the world markets. Moreover, Btc experts claim that this is never going to be an issue since Bitcoin was the pioneer and as such enjoys first-mover privilege.

Conclusion

By now, Bitcoin has emerged as one of the most innovative technologies in modern space. Bringing with it an entire industry, Btc has released a movement towards sound money, enhanced privacy, and censorship-resistance from coercive authorities.

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What is Bitcoin? A Detail Beginner Guide On Bitcoin | Coinpedia
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What is Bitcoin? A Detail Beginner Guide On Bitcoin | Coinpedia
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What is Bitcoin? So, let's start at the beginning and dive into who created Bitcoin, How to create Bitcoins? How to Invest in Bitcoin? Much more about bitcoin.
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Qadir AK

Qadir Ak - Co-founder of Coinpedia Blog - His interest as crypto Author, Editor, Speaker at cryptocurrency conference has made him known as passionate blogger and startup in Asia.

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