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Bitcoin: what it is

by Xozepew Usaz We are always in the lead!
Bitcoin is the most famous cryptocurrency in the world. Initially, the term was used by a narrow circle of people, but after the popularization of blockchain technology and the explosive growth in the value of digital money, many learned about it. The Internet is full of news about changes in the bitcoin rate, stories of huge earnings and the prospects for the development of the currency. But before investing in bitcoin, you need to study the features of the asset, the advantages and disadvantages, differences from other currencies and ways to make money on this.

Bitcoin: what it is - we explain in simple words

Bitcoin (BTC) is an electronic user payment system similar to digital wallets and bank accounts. The main unit for settlements on the network is bitcoin. Digital coins, unlike traditional money, are not tied to the economy of any country or to the central bank. All actions for issuing new money, processing payments and creating accounts are carried out by users.

The first developments of the system appeared in 2008 from the creator Satoshi Nakato and developer Hel Finney, and on January 3, 2009 the official launch of the system took place. Bitcoin has become a protest against traditional money and the pegging of finance to one country. The idea of ​​independent money was supported by a narrow community, but as the number of users and the value of BTC USD grew, the system began to gain popularity.

To fully understand the essence of bitcoin, you need to understand the principles of the system, creating wallets and processing transactions on the network.

A small excursion into the system:

1) Wallets are analogous to a bank or electronic account where money is stored. They are registered using special programs or sites. When creating a wallet, the user receives a public key (account number) and a private key (password for managing funds).

2) Transactions are required to transfer bitcoins between user wallets. All operations fall into a common pool, which is processed by other members of the system. But you need to pay a commission to confirm the operation.

3) Miners are those who "extract" bitcoins - they are the basis for the security and operability of the system. They use computing power to power the network in exchange for the rewards they receive. All operations for the extraction of new blocks and processing transactions fall on the shoulders of the miners.

4) Blockchain is a sequential chain of blocks in which information about transactions is recorded. The essence of the technology lies in the fact that data is stored on many independent servers and in the event of problems or failures, the network will remain operational.

The cost of a cryptocurrency directly depends on the level of user confidence, the number of people willing to buy an asset and market sentiment. Bitcoin's price is volatile due to political uncertainty and constant bans. The negative news background from the USA, Russia, China and the EU affects the behavior of investors.

How to buy bitcoin
To buy bitcoin, you need to create a wallet and understand the principles of its operation. The main thing is to securely save the private key and not transfer it to third parties, since it opens access to the management of funds.

The main options for buying bitcoin:

1) Exchange platforms. There are a large number of sites on the Internet that allow you to buy or sell bitcoin for a small commission. Bank accounts, popular Internet banking and e-wallets are used for transactions. It is necessary to choose an exchanger using reputable platforms that collect feedback on sites, exchange rates and allow you to search for the best deals.

2) Exchanges. Investors can immediately register on the exchange website, go through verification and replenish their account using a card. After that, it will be possible to buy bitcoin. You can store it both on the exchange and in your personal wallet.

3) Service Alligator. An intermediary platform between users that acts as a guarantor and protects the interests of buyers and sellers.

4) Direct deals. Investors can independently find bitcoin holders on thematic forums or websites, and then agree to buy BTC. For greater reliability, it is recommended to use a guarantor.

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About Xozepew Usaz Freshman   We are always in the lead!

8 connections, 1 recommendations, 41 honor points.
Joined APSense since, December 15th, 2020, From Canada, United Kingdom.

Created on Oct 27th 2021 13:04. Viewed 120 times.

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