What is bitcoin and Cryptocurrency?
What is Bitcoin? Bitcoin is making waves around the world, headlines. The value of the cryptocurrency is skyrocketing. What is this all about? What exactly is a Bitcoin and what is cryptocurrency? The typical questions have to get answered. We all have them, and we are probably ashamed that we’re all so in the dark. It is time to get up to speed and caught up in the crypto game. Let’s start with Bitcoin and expand beyond.
Origins, Lessons on What is Bitcoin
What is the origin of cryptocurrency and Bitcoin? Bitcoin began as a side project by the founder, Satoshi Nakamoto. People, to this day, still have no idea who he is. He is the unknown inventory of Bitcoin. Unveiling in 2008, Bitcoin was, it was known as a peer to peer electronic cash system by Satoshi.
Ever since then, the basis, foundation that Satoshi built evolves. Bitcoin still exists as the gold of the digital currency game. There are many others now, but it stands at the mountaintop. What is Bitcoin? It is the gold standard of crypto.
Where is the Currency?
Cryptocurrency is not physical at all. You cannot take the money out of your bank account and hold it or anything like that. Cryptocurrency is like buying a piece of a network, used to transfer funds from one individual to another. Bitcoin lives on a network of peers. Peers have a record with a history of all of their transactions and balance in their account. When you own a Bitcoin, you own a piece of the network.
Computers will mine the Bitcoins over a period, creating blocks that allow for more transactions to take place on the network.
Benefit of the Currency
Decentralization is the advantage of Bitcoin and cryptocurrency. It allows you to have quick, cheap and very reliable payment forms. No money is going to be tied to individual countries, at all.
Mining the cryptocurrency over a period by computers on a peer to peer network keeps it decentralized.
Every single Bitcoin has a unique identifier tied to it. It is a very complicated ID that is known as a hexadecimal code. Think of this as a way to increase the level of security over the currency when compared to that of a credit card. It is far harder to steal this type of identification when compared to a conventional bank account.
Limited in Quantity
What is Bitcoin all about? Bitcoins are a rare commodity, as are all other types of cryptocurrency. Bitcoins are mined over a period by computers. Once the mining is complete, there will only be 21 million Bitcoins in existence. No other Bitcoins mining stops after that point, once they are all in circulation. Different types of cryptocurrency have other mining totals, many of them more significant than this amount. They are a limited currency though, which is why the value continues to skyrocket.
Usability of the Currency
Many countries accept Bitcoin and other cryptocurrencies. You can use it to buy groceries, clothing, anything just as you would the local currency. The fantastic thing about cryptocurrency is that it is entirely digital. You are not carrying around any physical money at all.
When you buy something with cryptocurrency, you are taking it from your wallet. You can have a cryptocurrency wallet from a variety of providers. There are those that allow you to obtain Bitcoin, Litecoin, as well as many of the other common cryptocurrencies available.
Not Connected to Any Bank
Cryptocurrency is so different than any other type of currency in the world. It is entirely separate from any government and central bank. There are no connections to any of these, at all.
All of the cryptocurrencies manage through a network. The network is known as a blockchain. As the blocks pass through the network, the cryptocurrency passes between wallets.
An online ledger, representing the blockchain, shows all transaction activity. Every single time someone buys or sells a Bitcoin, the swapping of that cryptocurrency logs on the blockchain ledger.
How a Transaction Works
The way a transaction works begins with a request. The requested transaction broadcasts to a P2P network with nodes or computers. The nodes will validate the transaction, the user’s status, with algorithms. The verification of the transaction is where the Bitcoin begins to change hands. They combine into a block of data that is then moving into the blockchain. The transaction, this point, is fully complete.
Individual transactions make up the transfer of the blocks in the Bitcoin network, allowing for the currency swaps. Again, the value comes from the fact that there are only so many Bitcoins and so many blocks. Once they are in the hands of the holders and all are mine, there are no more to be had.
How Many Transactions is One Block?
One transaction is not one block. Let us get that out in the open right now. It required several hundred transactions with pieces of blocks going back and forth for one block to pass through the blockchain. Cryptocurrency transaction times happen relatively quickly but will vary based on the type of cryptocurrency.
The Future is Bright
The future is bright when you are talking about cryptocurrency. More people are aware of what it is about than ever before. It is no longer this foreign thing that select few understand. The game is changing, and it is time to get onboard the crypto train. If you think you are too late, you are likely going getting the info you’re wrong by its supporters. Bitcoin, as well as many other cryptocurrencies, appear here to stay. What is Bitcoin? It may be the future!