Understanding Bitcoin – General Overview
Bitcoin [BTC] is a decentralized virtual currency which is also called digital currency. It is a kind of cash for the internet. Satoshi Nakamoto founded it in 2008 and it went live in 2009 for the very first time.
Well, Satoshi Nakamoto is still a great mystery for people as it is still not clear who was satoshi Nakamoto or even if she exist or not. However, no one has ever claimed the foundership of bitcoin officially. Bitcoins are exchanged just like securities. Its extreme price vitality makes it a more attractive investment option. In 2012, 1 Bitcoin held the value of US$10 while in 2013 it reached to US$1000 approximately.
Its very low transaction cost made it convenient for foreign nationals to transfer money to their homes, especially in those countries where leaving with local money is prohibited. As things gain popularity, the fraud also starts in their name. Its software is downloaded the same as any other app and each digital wallet comes with a unique address and key. Canada launched the first bitcoin ATM using it customers can get cash in exchange for Bitcoin. Bitcoin can either be received using QR codes to their digital wallets or by a temporary paper wallet printed by ATM.
How Does Bitcoin Work?
People know that Bitcoin is not a tangible currency and it is a digital currency and there also there is physical bitcoin, only the record of bitcoin transaction exists. The transaction you make using Bitcoin is saved in a publically available general ledger – Blockchain.
If you want to send or receive Bitcoins, you require an address and a private key, these are the random number sequences along with letters and these are unique for all Bitcoin customers. When you send the bitcoins from one wallet to another, the transaction is stored into ‘Block’ for Miners to solve. The waiting time for Bitcoin transaction processing is Max. 10 minutes. The transaction fees are optional. However, the miners get the incentives to solve the blockchain fastly and fees go to the one who successfully verifies it.
Bitcoin Mining – Know The Basics
Mining is the way to discover Bitcoins. People think that Bitcoins are limited to 21 million. Since 2012, around 12 million Bitcoins are already discovered through mining. All the transactions are stored in a BlockChain and they are padlocked.
Miner applies some mathematical formulas to find the padlock key and verify the transactions. The successful miner gets 25 new Bitcoins as a reward. This process creates a new sequence of letters and numbers called Hash. This Hash is added to the end of the block as a digital signature to confirm the legitimacy of the transaction.
Bitcoin is a virtual currency that can be stored in a computer or mobile wallet but did not come under any bank or financial institution. The CTC takes bitcoin as the future commodity. The value of Bitcoin is highly fluctuating, since late 2017, it has fluctuated from $3000 USD to over $65000 USD in 2021.