Bitcoin is a digital currency created in 2009 to offer a “peer-to-peer digital cash system” where transactions do not go through a financial institution. Verification of the transactions is by a massive amount of computer software. Meaning there is no single entity or a person that controls the bitcoin network.
As opposed to traditional money, bitcoin only exists virtually, is the online version of cash. It is gaining popularity despite its not being a legal tender resulting in hundreds of other cryptocurrencies jointly known as altcoins. No one knows who invented bitcoin; however, the name Satoshi Nakamoto is associated with the pseudonymous person or group of people who released the original whitepaper in 2008.
How Bitcoins Work
The bitcoin system is a collection of computers that run bitcoin’s code and stock in a blockchain. Figuratively, a blockchain is a collection of blocks. In each block is an assortment of transactions. Because all the computers running the blockchain has the same list of transactions and blocks, and you can see the transactions, no one can cheat on the system; it is transparent. Anyone who wants to attack the system would have to control 51% of the computing power, which is unlikely because of the increased complex nodes in January 2021. But if an attack happens, the miners (those involved in the bitcoin network) will move to a new blockchain, making it more challenging to achieve a system disruption.
Private ‘keys’ keep the miners’ bitcoin balances. These ‘keys’ are long strings of letters and numbers interconnected through a mathematical encryption algorithm that created them. The public key (equal to a bank account number) serves as an address visible to the public eye. The private key (equivalent to an ATM PIN) used for transactions is a secret.
How to Buy Bitcoins
Before getting started, you need personal identification documents (if you are using Know Your Customer), a cryptocurrency account, a payment method, and a secure internet connection. First, choose an exchange that will enable you to buy bitcoin, sell, and hold the bitcoin. Head to the netcoins.app or check out Kraken, Coinbase, Gemini, Binance, etc. Secondly, connect your exchange to a payment option that can be through your debit or credit card. Thirdly, you are ready to start buying. The exchanges offer ways to invest and order types. Researching which exchange works best for you is highly advised. Lastly, you are open for storage. Digital wallets provide safe storage for cryptocurrencies.
The world is under a digital revolution; being among the future adapters is the only progressive action.
Rachelle Wilber is a freelance writer living in the San Diego, California area. She graduated from San Diego State University with her Bachelor's Degree in Journalism and Media Studies. She tries to find an interest in all topics and themes, which prompts her writing. When she isn't on her porch writing in the sun, you can find her shopping, at the beach, or at the gym. Follow her on Twitter and Facebook: @RachelleWilber; https://www.facebook.com/profile.php?id=100009221637700