What is Bitcoin?
Bitcoin is one of the first successfully made cryptocurrency. Bitcoin can be represented as either of the three - BTC, ฿ and ₿. Bitcoin is the world largest cryptocurrency by market cap and value. Since it’s release date, which was 2009, more than $7 trillion dollars ($7,000,000,000) has been transferred. The price of ₿1(1 bitcoin) is currently ~$31,000. The market capitalization of bitcoin is approximately $715,000,000,000.
Nobody knows who actually created cryptocurrency. A few possibilities of explaining the creation of bitcoin are - Bitcoin was created by an unknown individual with the presumed pseudonym of Satoshi Nakamoto or by a group of individuals with the name of Satoshi Nakamoto.
Market capitalisation is the market value of the total outstanding shares, the shares of a corporation that has been authorized, issued and purchased by investors and are held by them, of the company in dollars. The market capitalisation of a company is the price of a single share multiplied by the total number of outstanding shares held by them. The market capitalisation of all the cryptocurrencies is over a trillion dollars($1,000,000,000,000)
Since Bitcoin has been created, it has experienced significant ups and downs. An advantage of cryptocurrencies such as bitcoin is that it prevents inflation. Inflation is the gradual depreciation of the value of a particular currency in a period of time. Many different currencies have declined due to inflation.
However, with the use of cryptos such as bitcoin, their source code points out the number of that specific crypto and so, as the requirement of that crypto increases, so will its value. Thus, it will prevent inflation of the currency.
When was Bitcoin created?
Bitcoin’s domain name, “Bitcoin.org”, was officially registered in August 2008 but the bitcoin network officially came into existence in January 2009. The identity of the person or group of people who created this currency is still a mystery and yet to be found out.
Two years after BTC’s creation, the unknown “Satoshi Nakamoto” had disappeared from the web. Since then, there have been several assumptions to why he has disappeared from the web.
One of the reasons might be that he didn’t have interest in Bitcoin and wanted to move on to doing some other things in life. He said “I have moved on to other things. It is in good hands with Gavin and everyone”. Later, Satoshi Nakamoto handed over the source code to the Bitcoin repository and disappeared.
How does Bitcoin work?
Bitcoin mainly works through decentralisation and private keys.
Decentralisation
It is essential to understand the concept of decentralisation. One great example to understand decentralisation is given below.
Imagine you have a project to complete and you look for some information from Yahoo. When you go to Yahoo and search something, your computer is connected to Yahoo’s server. This allows you to view your result. If Yahoo’s server goes down, then you can’t view any result or see anything. This is because Yahoo is a centralised network. A centralised network has only one main server. In the case of decentralisation, you can still view your result as there are more than one central server. The data is everywhere, not just in one place. Refer more articles from digitalwalletsnews.com to understand the concept of decentralisation.
Private Keys
A private key gives you the right to spend Bitcoins through a cryptographic signature. A signature allows someone to prove ownership through a mathematical mechanism. They are very secure and there is no chance to crack them. Later, the transactions made are broadcast to the network and begin to be confirmed within 10-20 minutes, through a process called mining. Mining is the process of confirming transactions and increasing security.
Never forget your password
In bitcoin and other cryptos, you can’t recover your account if you forget your password, your cold wallet crashes, lose your device, etc. For example, Stefan Tomas forgot his password for accessing his bitcoin which is now in his IronKey hard drive. He had 7002 bitcoins, or $220,000,000 – 220 million dollars! Despite this tremendous loss, Stefan Tomas said that he had “made peace with loss”. A password can cost you $220 million.
How to buy Bitcoin
A few of the crypto wallets in which you can buy bitcoin are –
Binance – binance.com
Coinbase Pro – pro.coinbase.com
Coinbase- coinbase.com
Bitstamp – bitstamp.net
Upbit – sg.upbit.com
How to use Bitcoin
If you are a just a starter and directly want to start, here are the instructions:
The first thing that you’ll have to do is install any BTC wallet on your device such as Coinbase, Binance, etc. After you have completed this, your first BTC address will be generated. You can also generate one whenever you need to. Then you should divulge your ₿ address to the person so that they can pay you and vice versa. If you want to pay someone, then they should give you their Bitcoin address but always remember that the Bitcoin address can only be used once.
Did You Know?
Laszlo Hanyecz, an American developer, was the first person to be involved in a commercial transaction using bitcoin. On 22nd May 2010, Laszlo Hanyecz bought two Papa John’s pizzas for 10,000 BTC (bitcoins) from Jeremy Sturdivant. The amount he paid to buy the pizzas is about $314,606,000 in today’s currency but only $30 when the transaction was made. That day, 22nd May 2010, is now known as BTC Pizza Day. “Bitcoin is a way to harness greed,” said Hanyecz.
Disclaimer: Digital Wallets News does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
