What is Bitcoin? | Learn the Basics of Bitcoin | How to Use Bitcoin

Bitcoin is a digital currency or a cryptocurrency that has a market value. Bitcoin is not a physical coin or a paper and it is held electronically i.e Bitcoin can be stored only in computers, servers, etc. Though Bitcoin is not physical they have very high value, let say the value of 1 Bitcoin = +/- $16000 and can be converted into local currencies. The Bitcoin price keeps on increasing day by day. So, it is the right time to start accumulating in your Bitcoin wallet. Before that this article will help you learn What is Bitcoin and the basics of Bitcoin that a newbie should learn.

What is Bitcoin

Why Bitcoin? | Advantages of Bitcoin:

Bitcoin has its own advantages and one of the significances of Bitcoin is they are not controlled by any government or organization or anything else i.e. Bitcoin is decentralized. Bitcoin is open-source and they are not subjected to taxes. An individual can own how much ever Bitcoin he wants and doesn’t have to pay any taxes for the Bitcoin he owns.

Zero transaction fees(Now miner fees included in some of the transactions, check the wallet provider for more information) – this is the second most valuable advantage of Bitcoins. For instance, if you want to transfer your friend or if you wish to buy something online you must pay a part of the amount as transaction fees to the bank or financial company. In the case of Bitcoins transaction fee is zero even if you want to transfer millions of dollars.

No middle man – as said above you don’t have to depend on banks to transfer the amount to your friends or purchasing products and services online. To transfer Bitcoin to some just enter their Bitcoin address and click send. Within minutes the Bitcoin will be transferred to the receiver.

Transaction speed – the Bitcoin transaction speed is very fast that the receiver will receive the Bitcoin in the next second without any middle man.

When Bitcoin was introduced to the market the value of one Bitcoin was equal to $1, but now the rate of 1 Bitcoin has increased like anything to several thousand dollars making it the costliest currency in the world.

So, think you accumulated the Bitcoin when the value of the Bitcoin was $20 and sell it while the value is $13000. So, Bitcoin is like gold and not that gold value is not fixed.

Earn Bitcoin at BTC PTC sites.

What is Bitcoin(Watch video)?

Who Invented Bitcoin?

A software developer from Japan named Satoshi Nakamoto has invented Bitcoins in 2008. He also released the software as open-source so anybody can use it.

The Bitcoin is considered as one of the greatest inventions in the world. It will be one of the primary currencies in the world in the future.

Recommended article Bitcoin faucets.

What is a Bitcoin Address?

The Bitcoin address is used to send and receive Bitcoin. It’s like an email address that helps the sender to send Bitcoin to an exact receiver using the Bitcoin address.

An example of bitcoin address – 1LTU8LDAfSSWeJPEqJSu6L2wBAUYCe15EM

Few Wallets like Coinbase allow internal Bitcoin transfer using the Email address.

Dollar & Cents | Bitcoin & Satoshi:

The decimal part of the United States Dollar is called as the Cent. Similarly, the decimal part of the Bitcoin is called Satoshi.

1 cent = $0.01.

$1 = 100 cents.

1 Satoshi = 0.00000001฿.

1฿  = 100000000 satoshi.

How Bitcoin is Created:

What is Bitcoin

As I’ve said earlier Bitcoin is not a physical currency, hence they cannot be created as coins, currency notes, gold bars, etc.

So, how Bitcoin is created? Bitcoins are not created it is mined and this process is called Bitcoin mining.

Bitcoin mining is the process of solving some mathematical calculations which are used to mine Bitcoin. Mining is performed by computers and for good results, special computers and ASIC Miners that are designed to mine bitcoins are used.

Recommended article Learn in detail about the Bitcoin mining process.

Where the Bitcoin will be stored:

The Bitcoin will be stored in a Bitcoin wallet. There are several types of wallets, the wallet software that can be installed on the computer, the wallet app on the mobile phone, the internet wallet websites, the online exchange wallets like LocalBitcoins, etc.

Bitcoin can be stored anywhere but have to be protected carefully from being deleted. Bitcoin stored in computers is vulnerable to get deleted and similarly if an internet wallet is closed all the Bitcoin cannot be retained. So, it is important to choose the best internet services like CoinPayments, if not Bitcoins can be stored on our own computers.

The transaction of the Bitcoin is stored in a public ledger called the Blockchain.

What is the Use of Bitcoin | How to Use Bitcoin:

  • As said earlier Bitcoin can be converted into local currencies like USD, AUD, INR, GBP, EURO, etc. Learn how to sell Bitcoin for cash.
  • Apart from converting it to cash, there are several ways to use Bitcoin,
  • Bitcoin can be used to purchase physical products like mobile phones, electronics, wearable, etc from online shopping markets. There are several online shopping sites that sell products for bitcoins and they deliver worldwide.
  • Bitcoins are great currencies to buy online services like SEO, designing, web hosting, etc on service marketplaces like Fiverr. Bitcoin can save lots of money used as transaction fees.
  • Bitcoins are used for gambling. But gambling Bitcoin one can win more Bitcoin or lose available Bitcoin.
  • Bitcoins are used for trading. Bitcoin trading is one of the best ways to multiply the available Bitcoins at no time. But, Bitcoin trading is risky for beginners.

You might also like this FreeBitcoin review.

Disadvantages of Bitcoin:

  • The value of Bitcoin is highly volatile and unpredictable. While many make a profit from Bitcoin, there are chances the investment predictions might go wrong. So, you must be careful while investing in Bitcoin.
  • Bitcoin is used for illegal transactions as no one would questions. Even if someone makes a million dollars (black money) Bitcoin transaction, it is legal and they are safe.
  • Bitcoin without proper protection are prone to be hacked by hackers. If Bitcoin is hacked we can’t get it back or we cannot take any further legal action. This is one of the major drawbacks of Bitcoin.

Start earning Bitcoin 10 ways to earn Bitcoin.

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