What Is Bitcoin? Explained Everything In Detail

The value of 1 Euro is 79.38 INR and the value of 1 dollar ($) is 70.62 INR but the value of 1 bitcoin is 5,30,381.74 INR. Do you know Why? Did you ever hear the name Bitcoin? If Yes, Have you tried to know What is bitcoin? Why its value is so high and increasing day by day? Why everyone is rushing to invest in Bitcoin? How it can earn you money? Blah! Blah! Many such questions might be revolving in your mind.

What is Bitcoin?

Bitcoin is a form of electronic cash which is called cryptocurrency. Now, what is cryptocurrency? Cryptocurrency is a digital currency in which encryption techniques are used to manage the generation of units of currency(converting information or data into a code, especially to prevent illegal access) and verify the transfer of funds it is operated independently means it is not under the control of any central bank.

Transition is made to and from 16-character encrypted addresses. These addresses are mathematically secured so that they cannot be hacked or decrypted by any third person except the owner of the address that belongs to them.

The purchaser needs to decode the code in order to receive the sender’s Bitcoin. The transaction gets its safety and belief from a peer-to-peer computer network, which is similar to BitTorrent or any simple file-sharing system.

Properties of Bitcoin

Bitcoin Transitional Properties are Irreversible: After confirmation of the transition, it can‘t be reversed. Nobody can return it to you, neither any bank nor your government. Even the president of the US cannot help you out.

It is Quick and connected globally: Transactions are circulated almost immediately in the network and get approved in a couple of minutes. As it functions in a global network of computers, they are totally different from your physical location.

Users are Semi-anonymous: As no accounts are linked to a real-world identity. You get Bitcoin on the basis of address, which seems randomly chained about 30 characters. Although it is generally possible to analyze the flow of the transaction, it is not possible to link the real-world identity of the users with those addresses.

Secured and Permissionless Strong cryptography and the magic of large numbers make it impossible to break this plan and make it more secure. Bitcoin’s address is more secure than any bank’s security. No hacker can decode it except the owner of the address. It is open-source and you dont need any permission to use Bitcoin. Anybody can download its software for free. After installation of the software, you can send and receive Bitcoins absolutely for free without asking anyone.

Also read: Upcoming Future Technology & Gadgets That May Change The World

Its origin and the inventor of the bitcoin

Bitcoin is based on the concept called “Cryptocurrency”.The first Bitcoin term and proof of concept were published in 2009 on a cryptography mailing list by Satoshi Nakamoto. Satoshi left the project in 2010 without revealing his real identity. He had been not seen after this proposal.

Where to find bitcoins?

If you wish to find and get Bitcoin, I strongly recommend you to read the article given below in details
You can receive your bitcoins from these four sources.

A cryptocurrency exchange where you can exchange general currency for bitcoins. Example: Coinbase and Coinsquare in the US & Canada.

A Bitcoin ATM where you can exchange bitcoins or cash for another cryptocurrency. Examples: Some reliable bets are BTER and CoinCorner
Earn bitcoins through competitive mining.
Sell goods or services to get bitcoins.
- Examples: Purse is one of the excellent sites.

In some cases, you may find individuals who wish to sell Bitcoins in exchange for a credit card or PayPal payment but the problem is most of the exchange markets don’t allow payment by these methods because many think it is notorious for scams. This is because sometimes many we can see scenarios where someone buys Bitcoins with PayPal and then reverses the half transaction (called a chargeback).

How does Bitcoin work?

According to the users of Bitcoin, it is just a mobile app or computer software that gives a Bitcoin wallet and enables a user to send or receive bitcoins. It is the basic way of working with Bitcoin. It works on a huge public record, also called Blockchain.

These records contain each and every transaction ever processed and also allow a user’s computer to verify the validity of transactions. The authenticity of each transition is guarded by digital impressions matching the sending addresses, enabling any users to have control over transferring bitcoins from their own Bitcoin addresses.

By using the specialized hardware of computers anyone can process the transaction and can earn a bonus in bitcoins for these services. This is also called bitcoin mining.

What is Bitcoin mining?

Bitcoin mining is the process where high-performance computers are used to complete the transaction, keep everyone synchronized together in the system, and maintain the security of the bitcoin network in simple words, mining is used to issue fresh bitcoins.

Miners do this by solving a specialized program that enables them to “chain” together “blocks” of transactions which is called Blockchain. It is just like the Bitcoin data centre except that it is designed to be fully decentralized where all miners from the globe operate mining but no individual has control over it. It is somewhat like gold mining because it is also a temporary method that is used to withdraw new bitcoin. For this work, miners are awarded some transaction fee(sometimes they are awarded some units of bitcoins)

How to mine bitcoin:-

Buy Bitcoin mining hardware like Dreagonmint 16T.
Choose a mining pool. (Mining pool is the pooling of resources where miners share their processing power over a network in order to split the reward equally)
Use Bitcoin mining software like RPC Miner for Mac OS.
Make sure that bitcoin mining is legal in your country.
Also, make sure that bitcoin mining is Profitable for You.

Also read: How cryptocurrency mining works?

How buying and selling are done in bitcoins(trading in Bitcoin)

As we know bitcoin is a cryptocurrency that does not have any physical form, unlike other currencies. So, You may imagine how trading bitcoin is possible if it has no physical form. so here is your answer. You just have transaction records of different addresses with balances that are stored on the blockchain.

First of all, you need to download and sign up for a Bitcoin wallet but remember the wallet is for your private key, not for Bitcoin storage. You have choices to make an entry in the bitcoin universe by playing as a day trader and can use a regulated exchange such as GDAX or else you can find local traders to trade bitcoin.

But at present, the most popular way to purchase bitcoin is by using a regulated exchange like GDAX which is owned by the coin base. Even coinbase is struggling to keep speed with demand. You can buy Bitcoin by paying directly from a bank account, cash, credit card, debit card, or by a wire transfer which may take time.

What are blockchains?

Blockchain is a collection of data that represents a financial ledger entry, and transaction record. In the blockchain, data is entered into a block, by combining it with other blocks in chronological order and creating a series of linked blocks together. Every step is digitally signed to assure its authenticity. It is a ledger that is scattered over the network. Each block has data and blocks combined together to form a blockchain.

Bitcoin hidden details

Some hidden details of Bitcoin are as follows:-

No one knows perfectly when the first Bitcoin was discovered. Some believe that the birthday of BTC is on the 3rd, of October 2008 while others think on the 3rd, of January 2009.
Still, the world does not know who created the first Bitcoin. It is just a mystery. Some say that Satoshi Nakamoto created Bitcoin which was a Japanese citizen.
Some researchers claim that Satoshi Nakamoto is a group of companies where Samsung and Toshiba make Satoshi while Nakamichi and Motorola make Nakamoto.
May 22 is celebrated as Bitcoin Pizza Day because on 22nd, May 2010 two Papa John’s pizzas were traded by Laszlo Hanyecz for about 10K bitcoins which was about $41 at that time but now(on 20th, May 2019) it is around $78M.
You can only buy Bitcoin if you have a private key. But if you lose it then you lose your Bitcoin because without it the funds are lost forever.
There are about 21 million in the world from which 16.3 million have already been mined.

Uses of Bitcoin

Bitcoin can be used to buy things in the online world. In that sense, it’s like conventional dollars, euros, or yen, which are also traded digitally.

They are used primarily as a means of exchange and store of value. They are not well suited for use as a unit of account or for making payments, due to their volatile nature. It can be exchanged for other currencies, products, and services in legal or black markets.

What are the benefits of using Bitcoin?

Bitcoin offers several advantages over traditional fiat currencies, such as lower transaction costs and faster payment processing. It also offers a high degree of anonymity, which can be attractive to users who value privacy.

What are the risks of using Bitcoin?

Bitcoin prices are highly volatile, so investors may lose money if they invest at the wrong time. Additionally, there have been several instances of fraud and theft involving Bitcoin exchanges.

Advantages and disadvantages of investment in Bitcoin

Advantages

You can buy and sell bitcoins with anyone in the world and at any given time
You will not face any third-party interruptions. There is no way to disrupt user transactions or block any Bitcoin accounts governments, banks, and other financial organizations
You will not face any taxes as there is no involvement of the third-party authorities
Since Bitcoin transactions don’t have intermediary institutions or government involvement, the costs of transacting are very low
Bitcoin users can pay for their coins anywhere they have Internet access like any other online payment app.

Disadvantages

Many investors are unaware of Bitcoin and they lack an understanding of it.
Bitcoin is very limited and the demand for bitcoin is increasing day by day.
Its price is very high and requires too much electricity to get it.
Bitcoins have grown in recent years but it still in development.
You can lose Bitcoin if you lose your private key if your hard drive crashes or any other way
Due to the anonymous nature of Bitcoin, it is used in several illegal activities.

Conclusion

Friends I have covered almost all the points related to Bitcoin. I hope you have got complete information about Bitcoin. If you find it beneficial then you can start doing business with Bitcoin and earn money from it. Guys for more such topics Please subscribe to my website, if you have any doubt then give a comment and share it with your friends