What is Bitcoin?
Bitcoin is like a shiny new toy that everyone is talking about, but few people really understand. Once you understand it though, you might find yourself digging into an endless rabbit hole of knowledge.
If you’re one of the many people who are intrigued by Bitcoin but don’t know where to start, don’t worry, we’ve got you covered. We’ll explain what Bitcoin is, why it’s important, and how you can get started with this revolutionary new technology.
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Bitcoin was invented in 2008 by a person or group of people who called themselves Satoshi Nakamoto. The network was launched on January 3, 2009. Bitcoin is, in short, a 100% decentralized monetary system that can resemble how the internet works. It is not dependent on any form of authority or regulatory body, because the sum of the users is what determines its operation. Bitcoin works simply because everyone who uses it is involved in keeping it going and safe from any form of external interference.
At its core, Bitcoin is a digital currency that allows people to send and receive money without the need for a central authority. This means that you can send money to anyone, anywhere in the world, without having to go through a bank or payment processor. Instead, Bitcoin transactions are processed by a decentralized network of computers around the world, which work together to validate and record each transaction in a public ledger called the blockchain.
But why should you care about Bitcoin? For starters, Bitcoin offers many advantages over traditional forms of money. For example, Bitcoin transactions are fast, cheap, and secure. Unlike traditional bank transfers, which can take days or even weeks to process, Bitcoin transactions are typically completed within minutes. And because Bitcoin transactions are processed by a decentralized network of computers, there is no need for intermediaries like banks or payment processors, which can save you money on transaction fees.
Another advantage of Bitcoin is its security. Unlike traditional forms of money, which are vulnerable to theft and fraud, Bitcoin uses advanced cryptography to secure each transaction. This means that it’s virtually impossible for anyone to steal your Bitcoin or manipulate the Bitcoin network.
But Bitcoin is more than just a digital currency. It’s also a powerful tool for financial empowerment and inclusion. Because Bitcoin transactions are processed by a decentralized network of computers, anyone with an internet connection can send and receive Bitcoin, regardless of where they live or their financial status. This makes Bitcoin an ideal solution for people who are unbanked or underbanked, as well as for people who live in countries with unstable currencies or restrictive financial systems.
Getting started with Bitcoin is easy. All you need is a Bitcoin wallet, which is a digital wallet that allows you to send, receive, and store Bitcoin. There are many different Bitcoin wallets to choose from, ranging from simple mobile wallets to more advanced hardware wallets.
Once you have a Bitcoin wallet, you can start buying Bitcoin. There are many different ways to buy Bitcoin, including through cryptocurrency exchanges, Bitcoin ATMs, and peer-to-peer marketplaces. And because Bitcoin is a global currency, you can buy and use Bitcoin from anywhere in the world.
Bitcoin is a revolutionary new technology that has the potential to change the way we think about money and finance. Whether you’re interested in using Bitcoin as a means of payment or as an investment opportunity, there’s no denying that Bitcoin is an exciting and powerful tool. So why not join the Bitcoin revolution today and see what all the fuss is about? Who knows, you might just discover a new passion.
How many Bitcoins are there?
Bitcoin has a maximum supply limit of 21 million bitcoins. This means that once there are 21 million bitcoins in circulation, no more can be created. So why this limit?
Well, one of the main benefits of Bitcoin is that it is a decentralized currency. This means that it is not controlled by any government or financial institution. Instead, it is governed by a set of rules and protocols that are collectively agreed upon by the network’s users.
One of these rules is the 21 million limit. This limit is hardcoded into the Bitcoin protocol, which means that it cannot be changed without the agreement of the majority of the network’s users.
So why 21 million? This number was chosen because it is believed to be the maximum number of bitcoins that can be mined while still maintaining a manageable transaction processing time and keeping the network secure.
It’s worth noting that not all of the 21 million bitcoins are in circulation yet. In fact, as of February 2023, around 18.8 million bitcoins have been mined and are currently in circulation. The remaining bitcoins will be gradually released into circulation over the next century or so, with the final bitcoin expected to be mined around the year 2140.
So why does this matter? Well, the fact that there is a finite supply of bitcoins means that they are scarce, which can give them value similar to that of a precious metal like gold. Additionally, the fact that there is a limit on the supply of bitcoins means that they cannot be inflated like traditional currencies can be.
Overall, the 21 million limit is an important feature of Bitcoin that helps to make it a unique and valuable form of currency.
Are there enough Bitcoins for everyone?
A common misconception is that since there will only be 21 million Bitcoins, there will not be enough for everyone for Bitcoin to become a global currency.
A Bitcoin can be divided into 100 million units. These units are called Satoshis, or SATS. Just like how a dollar is divided into cents.
How to buy Bitcoin?
The easiest and safest way to buy Bitcoin today is through so-called “exchanges” or crypto exchanges.
These trading platforms allow you to buy Bitcoin easily and quickly via, for example, VISA/MasterCard or bank transfers. The transaction is usually completed quickly.
It is important to emphasize that Bitcoin held on exchanges is not 100% secure and is not owned by you other than on paper. This is where the phrase “not your keys, not your coins” comes from.
Storing Bitcoin typically involves the use of a digital wallet, which can be accessed through a variety of methods, including software applications on desktop or mobile devices, hardware wallets, and paper wallets.
When you own Bitcoin, what you actually have is a private key that allows you to access the coins on the blockchain. This private key is what you need to keep safe when storing Bitcoin, as anyone who gains access to it can spend your coins. Therefore, it’s important to keep your private key secure and not share it with anyone.
Hardware wallets are generally considered to be the most secure way to store Bitcoin. These devices are physical wallets that store your private key offline, away from the internet, making them much less vulnerable to hacking attempts.
Software wallets, on the other hand, are free or low-cost and can be installed on your desktop or mobile device. While they are more convenient, they are also more vulnerable to hacking attempts, so it’s important to take precautions such as using strong passwords and enabling two-factor authentication.
A golden rule is to keep your spending money on software wallets, and your savings(larger amount) on hardware wallets.