When you dig into Bitcoin’s history, you find an unbelievable tale that tells you how to create money. The cryptocurrencies concept might seem fictional, but it is one of the best digital currencies today.
The concept of Bitcoin and the technologies behind it can be confusing if you are not well versed in the art of encoding.
To help you completely understand what Cryptocurrency and Blockchain technology is, we have pulled up a guide for you to help you with everything related to Cryptocurrency, Bitcoin, and Blockchain technologies.
History of Bitcoin
The concept of the digital currency was coined decades ago before Bitcoin was introduced in the market. People were looking for a new financial system to trade.
However, they failed to create a currency that fit all the requirements. It was until 2009 that the dream of having digital currency came true.
The creator of the first Cryptocurrency, Bitcoin was Satoshi Nakamoto. The goal of creating Bitcoin was to offer the user a new electronic cash system parallel to the traditional cash system.
After a year of Crypto trade, the first purchase was made to buy two pizzas with 10,000 Bitcoins. I hope the pizza was good because if the person had held onto those 10,000 Bitcoins, he would have become a millionaire long ago.
What is Bitcoin?
Bitcoin is a digital decentralized virtual currency. It was introduced in the market in 2009. The sole purpose of the Bitcoin is to offer a decentralized medium for financial transactions.
The decentralized means, there are no authorities looking after the flow of the crypto transaction. Your transactions are anonymous and do not require the intervention of any intermediaries.
The Bitcoin transaction happens over peer to peer connection with the help of blockchain technology.
Also Read: Bitcoins and it’s Potential
How do you mine Bitcoin?
Before you understand how Bitcoin is mined, you first need to know what Bitcoin mining is. Bitcoin Mining is the authentication process of the Bitcoin transaction to see whether the transaction is legit.
Once the transaction is completed, it receives a consensus form that proves the transaction’s legitimacy.
The mining process involves powerful computers with hardware that are meant to solve mathematical problems. When these computers solve one block of information, Bitcoins are rewarded to the miners.
The user who mines Bitcoin establishes a Bitcoin address to store all its earned Bitcoin. You can consider this address as a virtual vault that is meant to store digital currencies.
How is Bitcoin Used?
Bitcoin mining is not the only process that helps you to earn Bitcoin. You can trade with Bitcoin or even receive payment in Bitcoins.
However, before you can start receiving Bitcoin as payment, you need to have a secure Crypto wallet. A crypto wallet is an application or software that is similar to PayPal but stores only Cryptocurrencies.
However, if you are interested in any software applications to set up your wallet, you can always go for a website-based wallet. There are several websites that cater to digital wallet services to their users.
If you have any idea about the trade market, you can earn Bitcoin with Crypto trading. You can exchange regular money to get Bitcoins, and then you can place them on the crypto exchange platforms to earn profit from the trade.
Risks that comes with Bitcoin
With great opportunities, the high risk always follows. Being decentralized in nature, Bitcoin has always been the main mode of transactions for the criminals.
Since there is no governing body backing it up, it is impossible to get back the lost digital currencies. You can visit https://q-profit-system.com/ to learn more about the disadvantages of Bitcoin.
The blockchain technology is still new and needs to be explored more to come up with more efficient ways to Bitcoin transactions. Until we unveil all its mysteries, Bitcoin will remain a risky and volatile asset.
The Bottom Line
Here, I have tried to point out everything possible while keeping the content simple and short.
I hope that it was helpful and was able to clear out the clouds blocking your conception about Bitcoin.