What is bitcoin?

Bitcoin is a revolutionary money payment network and a digital currency launched in 2009 by a mysterious figure by the name, Satoshi Nakamoto. Bitcoin is founded on a highly secure peer to peer system that makes it easy to facilitate transactions and difficult to corrupt. The bitcoin payment network consists of a digital ledger known as the blockchain. The blockchain records all transactions made on bitcoin since it was launched.

How does bitcoin work?

In simple terms, the bitcoin network is a protocol of sending money through the internet. Unlike PayPal or visa, however, bitcoin uses a digital ledger to validate transactions and does not require a middleman. Two individuals can send and receive bitcoins from each other without going to a bank to facilitate the exchange. Bitcoin’s blockchain is secured through cryptography, a system that encodes data in a hard to hack manner.

To ensure that no one misuses the network, transactions done must be verified by people referred to as miners.  The miners process transactions which are confirmed by nodes. Validated transactions are then added into blocks that make up the blockchain. Bitcoin miners use their computing power to solve unique math problems provided by the bitcoin network. Bitcoin mining follows rules of bitcoin protocols. If a miner does not produce blocks that are legal, the nodes reject them and the miner loses a chance to win a reward.

The process of mining bitcoins, or validating that transactions happened, can be done on a normal computer with special hardware and software programs. To mine bitcoin in specific, you need highly powerful and expensive mining equipment referred to as ASIC machines.

How to get bitcoins

what is bitcoin?

There are several ways to acquire bitcoins. The first and most popular way is to buy them. Create an account on a bitcoin buying and selling platform and purchase bitcoins. As of today, 1 bitcoin is valued at $10,000. If you can’t afford 1 bitcoin, you can purchase a fraction of a bitcoin. The lowest fraction of a bitcoin is known as a ‘satoshi,’ named after its founder. The second way to acquire bitcoin is by mining. Miners need a computer and the right equipment to mine. Most miners work as a team to verify bitcoin transactions. Once they validate enough transactions to form a blockchain, they are rewarded with 12.5 bitcoins which they can then share.

Additional ways to earn bitcoin include creating an account in a bitcoin faucet, playing video games that reward you with bitcoins or becoming an affiliate marketer for a company that pays in bitcoins. Here are these methods discussed into broader details:

Bitcoin lending

The idea here is to lend someone your bitcoins in exchange for interests on how they invest them. You lend your bitcoins to other users and get them back with an interest. When lending bitcoins, it is important that you choose your lenders wisely. Take time and research widely to know the best bitcoin lending services. Lend your money to a person or organization that promises higher returns.

Mining bitcoins

Mining bitcoins is the process of validating bitcoin transactions. Pioneered by bitcoin’s founder, mining helps prevent users from misusing the bitcoin network. To mine efficiently, invest in the right equipment and software. Also, join a mining pool as it is often difficult to make profits mining alone.

 Bitcoin trading.

Bitcoin trading refers to buying and selling of bitcoins. Bitcoin’s prices change with time. In fact, bitcoin’s value is very unpredictable. In 2017, bitcoin rose in value from just $1000 at the beginning of the year to $20,000 by end of 2017. To be successful, follow bitcoin trends and purchase when its value goes down.

 Bitcoin affiliate marketing.

This refers to promoting another person’s product so that you are paid in commissions. With bitcoin, affiliate marketing is common with new digital currencies as well as bitcoin exchange platforms.

How much is a bitcoin worth?

The bitcoin price has varied gradually since it first recorded it price in 2010. In 2010 a single bitcoin was equivalent to $ 0.39.  Within five years, the value of one bitcoin had risen to nearly $1000. Bitcoin’s value from its inception to date has risen by thousands in percentage. As of 17th January, the value of a bitcoin is $10,000.

How to use bitcoin

There are many ways to use bitcoins. If you are like most people, simply buy bitcoins and sell them when their value goes up. However, people who want to experience firs hand use of bitcoins have many options. Since bitcoins are a form of currency, you can use them wherever they are accepted. You can buy jewelry, paintings, food at restaurants or even pay for college using bitcoins.

Late last year, Sweden became the first country to accept bitcoin as a means of debt settlement. In Brazil, a college accepted bitcoins as a form of tuition money. All around the world, private and public organizations are accepting bitcoins just like any other currency. Bitcoin offers several benefits that make it really convenient in a wide range of applications. The cost to send bitcoins, for example, is much lower than sending real money. That means if you wish to send money in a foreign country and you wish to save on charges, bitcoin should be your preferred option.