What Is Bitcoin ?
Bitcoin is the most well-known and oldest cryptocurrency. On the 3rd of January, 2009, it was born. As of December 2017, there were more than 16.7 million bitcoins in circulation, with a total worth of almost USD 250 billion. That's still a drop in the bucket when compared to...
Bitcoin is the world's oldest the most well cryptocurrency, with a ten-year track record of continuous operation. Despite its widespread acceptance, many people are still unsure of what it is, what it means, and how it all works.
Bitcoin
Bitcoin is a peer-to-peer electronic cash system that works without the use of central authorities such as governments or banks. Because of its open-source nature, all of its transactions, including bitcoin issuance, are collectively secured by brilliant math, cryptography, and network participants known as miners. It is the most sophisticated, accessible, and transparent money because of its design. Anyone with the necessary skills can help develop it or create applications on top of it.
Things you should know about Bitcoin
The history of Bitcoin begins on January 3, 2009, when Satoshi Nakamoto and other cypherpunks decided to turn their idea into a reality. The current price of one bitcoin is around $9,000 as of today. Its price is determined by supply and demand in a free market. The greater the demand for bitcoin, the higher the price is likely to rise.
As of June 2019, there were nearly 18 million bitcoins in circulation, with a total value of around $150 billion. That's still a pittance compared to fiat currencies like the US dollar, which has a market capitalization of 3.7 trillion dollars. When compared to gold, which has a market cap of over $7 trillion, the number is even smaller.
The creator of Bitcoin, a person or group known only by the pseudonym Satoshi Nakamoto, set a limit of just under 21 million coins in circulation. By the year 2140, it's expected that all of those bitcoins will have been produced (or "mined" in cryptocurrency parlance).
The Bitcoin network is decentralised, which means that no single entity has control over it. It's based on distributed ledger technology, also known as blockchain technology (DLT).
Not only does Bitcoin outperform other cryptocurrencies in terms of price. It also has the largest merchant network that accepts it. However, due to a sharp increase in fees and slower transaction confirmation, using Bitcoin for everyday purchases has become more difficult. As a result, Bitcoin is sometimes referred to as an asset rather than a currency. However, as a result of this development, second layer solutions such as The Lightning Network (LN) have emerged, allowing users to trade with minimal fees.
Bitcoin is also popular among speculators who seek to profit from price fluctuations. Some even claim that the Bitcoin price is manipulated, which is a likely scenario given how unregulated the cryptocurrency is. Wealthy industry players (known as "whales") can have a greater influence on bitcoin prices than others. However, once Bitcoin is widely adopted and has sufficient liquidity, the price fluctuations are likely to fade away.
How to Begin with Bitcoin
Getting started with Bitcoin is becoming increasingly simple. You only need to open a cryptocurrency exchange account and download a Bitcoin wallet app to get started.
Keep in mind that the price of it is extremely volatile, with double-digit percentage swings up and down. Bitcoin's price soared from under $1,000 to over $14,000 in 2017, with a high of $19,000 at one point. Some predict that the currency's value will rise to tens of thousands or even hundreds of thousands of dollars, while others believe it has no value and call the price increase a bubble. However, this isn't the first time bitcoin's price has skyrocketed and then plummeted. It had three similar price explosions since 2011, all of which were followed by 80% retracements. Every one of these "bubbles" has resulted in a net increase in value.
In any case, Bitcoin is attracting an increasing number of users and merchants around the world because it allows users to bypass banks and other financial institutions, potentially lowering transaction costs and speeding up international transactions. Transferring $1 worth of bitcoins or $100 million worth of bitcoins, for example, would cost the same.
In addition, Bitcoin offers greater anonymity than traditional banking (though it is not completely anonymous). It also gives people more control over their money because the supply is not controlled by the government, and no bank can freeze your account. However, some governments (such as Russia) have banned or restricted the use of Bitcoin (like China). However, such a prohibition only works in theory, as nothing can prevent people from trading bitcoins.
So, what is Bitcoin?
There are far too many aspects of bitcoin to cover in a single guide. Some people study it for years and still don't fully grasp it. However, if all you want to do is use it, you don't need to fully comprehend it.
In the end, Bitcoin, like other cryptocurrencies, is still in its early stages of development, and no one knows what opportunities or challenges it will present in the future. However, no one knows what will happen to our traditional money. Its value could depreciate, or it could be frozen in a bank account, or the entire payment system could be hacked.