The general definition of bitcoins refers to them as a type of virtual currency that operates over the Internet.
What are Bitcoins
There are two terms: bitCoin and bitcoin. The difference is in the spelling of the first letter. They capitalize on a word that refers to a network or software for working with bitcoins. Writing with a small letter means the electronic currency itself.
The idea was implemented by Satoshi Nakamoto in May 2008. Bitcoin is a peer-to-peer payment system that allows you to send and receive electronic money without intermediaries.
Why Choose Bitcoin?
Cryptocurrency allows you to make transactions anonymously. It is easy to make an international payment. There are no fees because bitcoins are not tied to a specific country. Do not obey any rules or restrictions. Beneficial for small business owners, as it does not require payment for the use of funds.
How Does Bitcoin Works?
Bitcoins are very similar to conventional payment systems. The number of merchants accepting this form of payment online and offline is growing. You can use them to pay for purchases in your favorite shopping center, order pizza, and more.
Bitcoins are a completely decentralized form of money. Unlike the dollar, pound, or ruble, digital money is not backed by any government or tied to central banks or regulators. In short, bitcoins can be used for any kind of payment. First, you need to purchase them. This can be done with a credit card or purchased anonymously with cash.
Then, they will appear in your account in the Bitcoin payment system. You can now send or receive a money order directly to the seller or buyer.
Bitcoin Basics For New Users
A new user must first install Bitcoin. It is a virtual wallet that allows you to make payments, buy goods, or simply store money.
After installation, the program generates the first Bitcoin address. It can be transferred to friends to pay them, and vice versa. The scheme resembles an email exchange, with the difference that the bitcoin address is used only once.
Everything You Need To Know About Bitcoins
1. Fast Peer-To-Peer Transmission
Bitcoin works on the principle of a peer-to-peer network so that transactions are managed without centralized control. The program is open and completely transparent. In other words, it does not belong to anyone and, accordingly, is not controlled.
2. Easy Installation
To use standard currencies or payment systems, you need to contact the bank. Even a simple account opening procedure is fraught with difficulties. You must confirm your identity, fill out questionnaires. In the case of bitcoins, in a few seconds, you get a bitcoin address and pay without commissions and unnecessary questions.
3. No Centralized Management
Nobody owns Bitcoin. Available at any time. But, you need to remember that payments in this system are irreversible. The spent bitcoin will not be returned back by either the bank or the state.
Freedom of use carries a lot of responsibility. No one to complain if something goes wrong. There is only one way out – not to trust your cryptocurrency to unverified people on the Internet.
4. Price Per Bitcoin
As with regular currencies, the value of bitcoins is determined by supply and demand. So far, the number of users is relatively small. If more people start using bitcoins, the price may fluctuate.
5. Purchase on Exchangers
There are several places where you can buy and sell bitcoins for national money. They are known as Bitcoin Exchangers.
You can search the Internet to find an exchange that you can trust with your bitcoins. For example, the largest cryptocurrency exchange is called Mt.Gox.
6. Secure Transfer Between Bitcoin Wallets
Bitcoin has a secure key called a seed. It is used to sign transactions. This is a guarantee that the bitcoins belong to the owner of the account. The electronic signature ensures the continuity of the transfer of funds after it has started.
7. The System is Completely Transparent
Bitcoin transfers are completely transparent. All confirmed payments are included in the public database. It is called the ” blockchain of transactions “, and transliteration from English ” Blockchain ” is also used.
The Bitcoin wallet calculates the balance of funds, and with each transaction confirms the ownership of the owner.
8. Operations are Irrevocable
Once sent, bitcoins cannot be returned back. The only way to get them back is to ask the recipient to send them. Once debited from the account, Bitcoins are debited completely.
Despite the fact that all transactions are available for viewing in the public database, only wallet addresses are visible. There are no buyers’ or sellers’ names. For this reason, unfortunately, bitcoins are convenient for buying drugs and other illegal goods over the Internet.
10. The Future of Bitcoin
Due to the lack of regulation, it is difficult to predict the development of the network in the future. Governments in many countries are worried about the lack of control over Bitcoin and are speculating about the possibilities of taxing secure transactions.