Collecting Bitcoins

Bitcoin (BTC) is a new type of digital currency with cryptographic keys and is decentralized for a network of computers used by users and miners around the world and not controlled by a single organization or government. It is the first digital cryptocurrency to gain public attention and is accepted by a growing number of merchants. Like other currencies, users can use the digital currency to purchase goods and services online, as well as in some physical stores that accept it as a form of payment. Currency traders can also trade Bitcoin on Bitcoin exchanges.

There are several key differences between Bitcoin and traditional currencies (such as the US dollar):

1. Bitcoin has no centralized authority or clearinghouse (such as a government, central bank, MasterCard or Visa network). The peer-to-peer payment network is operated by users and miners worldwide. Currency is transferred anonymously between users directly over the Internet without going through a clearing house. This means that transaction fees are much lower.
2. Bitcoin is created through a process called “Bitcoin mining”. Miners around the world use mining software and computers to solve complex bitcoin algorithms and validate Bitcoin transactions. They are rewarded with transaction fees and new bitcoins from solving Bitcoin algorithms.
3. There is a limited amount of bitcoins in circulation. According to Blockchain, there were approximately 12.1 million units in circulation as of December 20, 2013. The difficulty of mining bitcoins (solving the algorithms) gets harder as more bitcoins are produced, and the maximum amount in circulation is limited to 21 million. The limit will not be reached until about 2140. This makes Bitcoins more valuable as more people use them.
4. A public ledger called the Blockchain records all Bitcoin transactions and shows the respective holdings of each Bitcoin owner. Anyone can access the public ledger to verify transactions. This makes the digital currency more transparent and predictable. More importantly, transparency prevents fraud and double spending of the same bitcoins.
5. The digital currency can be obtained through Bitcoin mining or Bitcoin exchange.
6. The digital currency is accepted by a limited number of merchants online and at some retailers.
7. Bitcoin wallets (similar to PayPal accounts) are used to store Bitcoins, private keys and public addresses, as well as transfer Bitcoins between users anonymously.
8. Bitcoins are not insured or protected by government agencies. Thus, if the secret keys are stolen by a hacker or lost on a failed hard drive or due to the shutdown of a Bitcoin exchange, they cannot be recovered. If the private keys are lost, the associated bitcoins cannot be recovered and will go out of circulation. Visit this link for frequently asked questions about Bitcoins.

I believe that Bitcoin will be more accepted by the public because users can remain anonymous when buying goods and services online, transaction fees are much lower than credit card payment networks; the public ledger is accessible to anyone and can be used to prevent fraud; the currency supply is capped at 21 million and the payment network is run by users and miners instead of a central authority.

However, I don’t think it is a great investment vehicle because it is extremely volatile and not very stable. For example, the price of bitcoin rose from around $14 to a peak of $1,200 this year, before falling to $632 per BTC at the time of writing.

Bitcoin has rallied this year as investors speculated that the currency would gain wider acceptance and rise in price. The currency fell 50% in December as BTC China (China’s largest Bitcoin operator) announced that it could no longer accept new deposits due to government regulations. And according to Bloomberg, China’s central bank has banned financial institutions and payment companies from handling bitcoin transactions.

Bitcoin will likely gain more public favor over time, but its price is extremely volatile and highly sensitive to news (such as government regulations and restrictions) that could negatively impact the currency.

Therefore, I do not suggest investors to invest in Bitcoins unless they are bought at a price below 10 USD per BTC, as this greater margin of safety.

Otherwise, I believe it is better to invest in stocks with strong fundamentals as well as great business prospects and management teams, as the underlying companies have intrinsic values ​​and are more predictable.

Disclosure: Victor Liang has no position in Bitcoins and has no plans to change his position in the next 72 hours.

A Guide to Understanding Bitcoin and Cryptocurrency?

Although Bitcoin is one of the most searched terms (according to Google), it is a very technical topic for many people and can be overly technical for non-geeks. However, there are now hundreds of cryptocurrencies and more and more people want to know how they work because of the insecurity of bankers, which is a whole different discussion.

It’s hard to get a layman’s explanation without using technical terms like “secret keys”, “digital keys”, “digital wallet” and “cryptocurrency”, so I’ll do my best to keep things as straight as possible. be able.

The concept of fiat money, i.e. paper currency, was created to make it easier for people to exchange goods or services, as this would at best be limited to an exchange between two willing parties, whereas money allows you to provide money. purchase your service or goods, and then any services or goods you request from another or others.

Therefore, I would argue that Bitcoin is the 21st century equivalent of barter because it works directly as an exchange of goods or services between two willing parties. Barter must be based on every promise and trust, to secure and deliver the promised good or service.

With Bitcoin or any other cryptocurrency today, each party needs a unique file or unique key to exchange an agreed value between each other.

By having a unique key or file, it becomes easier to keep a record of each transaction. But this also comes with problems.

Now, barter is a simple exchange of skills or goods as I already mentioned, the modern equivalent or bitcoin is vulnerable to security breaches, i.e. theft or hacking of files, where a “cryptocurrency wallet” comes into the equation to ensure security. your transactions.

Basically you need a safe place for your cryptocurrency/bitcoin purchases and holdings. Hence the need for a hardware wallet.

So now you have written/recorded what amount of bitcoins are stored at which address and then updated each time a transaction is made, the file is known as the “Blockchain” and it stores a record of all bitcoin transactions.

The next thing is to ensure that our files remain unique.

I will talk about this in my next article.

Introduction to Bitcoin

Bitcoin is an advanced form of currency used to buy things through online transactions. Bitcoin is not tangible, it is completely managed and created electronically. Since the value of Bitcoin is constantly changing, you need to be careful when to contribute to it. Bitcoin is used to exchange various currencies, services and products. Transactions are done through a computerized wallet, so transactions are processed quickly. Since the customer’s identity is not disclosed, such transactions have always been irreversible. This factor makes it somewhat difficult when deciding on transactions through Bitcoin.

Features of Bitcoin

Bitcoin is faster: Bitcoin has the ability to settle installments faster than any other mode. Usually when one transfers cash from one side of the world to another, the bank takes a few days to complete the transaction, but in the case of Bitcoin, it only takes a few minutes to complete. This is one of the reasons why people use Bitcoin for various online transactions.

Setting up Bitcoin is easy: Bitcoin transactions are carried out through the address that each customer has. This address can be easily assigned without going through any of the bank’s record keeping procedures. Creating an address can be done with no modifications, no credit checks or inquiries. However, any customer considering contributing should always check the current value of Bitcoin.

Bitcoin is anonymous: Unlike banks that keep complete records of their customers’ transactions, Bitcoin does not. It does not record customers’ financial records, contact information or any other relevant information. A Bitcoin wallet generally does not require any significant information to operate. This feature comes from two points of view: first, people think it’s a good way to keep their data away from third parties, and second, people think it can increase dangerous activity.

Bitcoin cannot be denied: When someone sends Bitcoin to someone, there is generally no way to get the Bitcoin back unless the recipient feels the need to pay them back. This feature ensures that the transaction is complete, meaning that the beneficiary can never claim to have received the cash.

Bitcoin is decentralized: One of the main features of Bitcoin is that it is not under the control of a specific management expert. It is managed in such a way that every entity, individual and machine involved in exchange verification and mining is part of the system. Even if part of the system goes down, money transfers continue.

Bitcoin is transparent: Although only one address is used to make transactions, every Bitcoin exchange is recorded on the Blockchain. So if at any point someone’s address is used, they can tell how much money is in the wallet via Blockchain records. There are ways to increase the security of your wallets.

Technology is advancing by leaps and bounds. It introduces new terms and systems for business and communications on a daily basis. The Internet has contributed greatly to this progress; especially when it comes to the workplace. Online trading or online currency trading has recently attracted many traders. One common form of online trading is Bitcoin Exchange.

What is Bitcoin?

Bitcoin exchange is a new money system for the internet that works on the concept of digital currency. It enables a peer-to-peer payment system for individuals with no central authority. It uses a new cryptocurrency concept originally introduced in 1998. Cryptography controls the creation and transactions of digital money. Bitcoin works through a software system and has no central controlling authority, so it is controlled and controlled equally by its users all over the world.

Operation of Bitcoin Exchange

You can work with Bitcoin exchange just like you work with any other currency exchange. Just like working with banks, making transactions through Bitcoin Exchange is easy. Similar to physical trading, the user has to pay to buy Bitcoins. The difference is that a person has to open an account with some Bitcoin exchanger. The user’s paid asset will be in the form of a digital currency that can be used to purchase any type of product. Bitcoins can also be exchanged with other bitcoin holders. This system works like money exchanges in banks.

Conducting operations

Almost all payment systems accept refunds after processing through PayPal or credit cards. But with Bitcoin, the situation changes, because once you make a transaction, it cannot be redeemed or refunded. So, be careful when exchanging your bitcoins with foreign exchange tools as you may face chargeback issues. Better to exchange with other bitcoin holders near you.

Advantages of Bitcoin Exchange

Bitcoin currency exchange is quite new. It is a kind of software based payment system where you make transactions digitally. How it can benefit you:

· Perform transactions faster than other systems

· Always available for operations

· Make transactions from anywhere in the world

· Make more secure transactions

· To carry out transactions without the intervention of any third party

· Control all operations from your home computer or smartphone

· Buy any type of asset using Bitcoin

Disadvantages of Bitcoin

Bitcoin exchange is an innovation in the economic systems of the world. When used practically, some disadvantages also appear. Some of them are as follows:

Ø Reception in the market

Bitcoin has a growing number of users, but is still not a widely used currency or exchange system. Its level of acceptance in financial matters is still low.

Ø Instability

Bitcoin is not a stable currency because it is not widely used. However, there is hope that this volatility will decrease as the user list and quantity of bitcoins in the market become more accessible.

Ø Partial development

The big problem is that the Bitcoin software is still in beta and has a number of buggy features that still need to be fixed. New modules are under development to make Bitcoin exchange safer for everyone.

Bitcoin is known as the first decentralized digital currency, they are essentially coins that can be sent over the Internet. 2009 was the year when bitcoin was born. The name of the creator is not known, but he was nicknamed Satoshi Nakamoto.

Advantages of Bitcoin.

Bitcoin transactions are made directly from person to person over the internet. You don’t need a bank or a clearinghouse to act as the middle man. Due to this, transaction fees are very low, they can be used in all countries of the world. Bitcoin accounts cannot be frozen, there are no prerequisites for opening them, same for limits. Every day more and more merchants start accepting them. You can buy anything you want with them.

How Bitcoin Works

It is possible to exchange dollars, euros or other currencies for bitcoin. You can buy and sell like any other country’s currency. To store your bitcoins, you need to store them in something called a wallet. This wallet is located on your computer, mobile device or third party websites. Sending bitcoins is very simple. It’s as simple as sending an email. You can buy almost anything with bitcoins.

Why Bitcoins?

Bitcoin can be used anonymously to buy any kind of goods. International payments are extremely easy and very cheap. This is because bitcoins are not actually tied to any country. They do not follow any rules. Small businesses love them because there are no credit card fees. There are people who buy bitcoins for the sole purpose of investing, to increase their value.

Ways to get Bitcoin.

1) Buy on an exchange: people are allowed to buy or sell bitcoins from sites called bitcoin exchanges. They do this using their own country’s currency or any other currency they have or like.

2) Transfers: individuals can simply send bitcoins to each other via their mobile phones, computers or online platforms. It’s the same as sending cash digitally.

3) Mining: the network is maintained by some individuals called miners. They are regularly rewarded for all newly confirmed transactions. Theses transactions are fully audited and then they are recorded in a ledger known as a public transparent ledger. These individuals compete to mine these bitcoins by using computer hardware to solve difficult math problems. Miners invest a lot of money in hardware. Nowadays there is something called cloud mining. Using cloud mining, miners simply deposit money into third-party websites, which provide all the necessary infrastructure, reducing hardware and energy consumption costs.

Storage and storage of bitcoins.

These bitcoins are stored in what are called digital wallets. These wallets exist in the cloud or on people’s computers. A wallet is something similar to a virtual bank account. These wallets allow people to send or receive bitcoins, pay for things, or simply store bitcoins. Unlike bank accounts, these bitcoin wallets are never insured by the FDIC.

Types of wallets.

1) Cloud wallet: the advantage of having a cloud wallet is that people don’t need to install any software on their computers and wait for long synchronization processes. The downside is that the cloud can be hacked and people can lose their bitcoins. Nevertheless, these sites are very safe.

2) Computer wallet: the advantage of having a computer wallet is that people protect their bitcoins from the rest of the internet. The disadvantage is that people can delete them by formatting the computer or due to viruses.

Bitcoin anonymity.

When making a bitcoin transaction, there is no need to provide the person’s real name. Each recorded bitcoin transaction is known as a public log. This log contains only wallet IDs, not people’s names. so basically every transaction is private. People can buy and sell things without being tracked.

Bitcoin innovation.

Bitcoin has created a whole new way of innovation. Bitcoin software is open source, which means anyone can review it. Today, it is a fact that bitcoin is changing the world of finance in the same way that the internet has changed everything about publishing. The concept is brilliant. When everyone has access to the entire bitcoin global market, new ideas emerge. Reduced transaction fees are a fact of bitcoin. Accepting bitcoins is cost-effective and also very easy to set up. Chargebacks are not available. The Bitcoin community will generate all kinds of additional business.

Although ‘Bitcoin’ is a very common term, few people know what it really is. Although it is a trading system, it is the most different from the others for two main reasons. First, it involves an easily transferable form of digital currency. What makes it more unique, however, is that no banks or other formal financial institutions are involved. It is simply an independent and unaccountable peer system. Below are the most important bitcoin news and highlights:

Anonymity – If you want to perform simple transactions without using your personal identity and bank account information, bitcoins make it possible. Unless you choose otherwise, all transactions are anonymous and cannot be traced back to you. An address is created for each transaction, which is unique and will never be duplicated.

Buyer’s Privileges – Unlike other forms of trading, bitcoins are irreversible and you cannot cancel a payment once you have sent it. If you need to reverse the transaction, you will need the buyer’s consent. Also, transactions take about 10 minutes to complete, unlike other financial transactions that are processed almost instantly.

Buying luxury items – One of the main reasons why Bitcoins became popular was that they were ideal for buying foreign luxury items. These are heavily taxed by the governments of these countries and the final costs are very high. There are zero taxes that you have to pay because there is no government agency involved in Bitcoins. This makes it ideal to use them for purchasing items from foreign countries, along with the already minimal transaction costs.

Mobile wallet – Among the most popular bitcoin news was the fact that a mobile version was introduced in addition to the desktop version. This means you can install an app on your smartphone and manage your bitcoins through it. It also makes it easy to exchange your coins for dollars whenever you want.

Limited acceptance – Despite the increasing use of Bitcoins, you should check if the store where you want to use them accepts them. There are still a few places that don’t accept them as a valid, usable form of currency. However, this is expected to change soon, with digital currency easily becoming more popular.

Bitcoin is a relatively new type of currency that is starting to hit the mainstream markets.

Critics say that using Bitcoin is dangerous because –

• They have no real value

• They are not regulated

• They can be used to conduct illegal transactions

Still, all major market players are talking about Bitcoins. Below are some good reasons why this cryptocurrency is worth using.

Fast Payments – When payments are made through banks, the transaction takes a few days, as do money transfers. On the other hand, the virtual currency Bitcoin transactions are generally faster.

“Zero-confirmation” transactions are instantaneous, where the merchant accepts the risk, which is not yet verified by the Bitcoin blockchain. If the seller needs approval, the transaction takes 10 minutes. It is faster than any interbank transfer.

Cheap – Credit or debit card transactions are instant, but you’ll be charged a fee for this privilege. Fees in Bitcoin transactions are usually low and in some cases free.

No one can take it away – Bitcoin is decentralized, so no central authority can take interest from your deposits.

No Refunds – After trading the bitcoins, they are gone. You cannot redeem them without the buyer’s consent. This makes it harder to commit chargeback fraud that people with credit cards often face.

People buy an item and if they discover it’s defective, they effectively reverse the transaction by going to the credit card agency for a refund. The credit card company does this and charges you an expensive chargeback fee of between $5 and $15.

Secure personal data – Credit card numbers are stolen during online payments. No personal information is required for Bitcoin transaction. You need to combine your private key and your Bitcoin key to make a transaction.

You just need to ensure that your private key is not accessed by outsiders.

This is not inflation – The Federal Reserve prints more dollars when the economy is booming. The government injects newly created money into the economy and causes the currency to depreciate, thereby causing inflation. Inflation reduces people’s purchasing power because the prices of goods rise.

Bitcoins are in limited supply. The system is designed to stop mining more bitcoins when it reaches 21 million. This means that inflation will not be a problem, but deflation will occur where the prices of goods will fall.

Semi-anonymous transactions – Bitcoin is relatively private but transparent. A Bitcoin address is discovered on the block chain. Anyone can see your wallet, but your name will be invisible.

Easy micropayments – Bitcoins allow you to make micropayments as low as 22 cents for free.

Replacement of fiat currencies – Bitcoins are a good option to hold national currencies that face capital controls and high inflation.

Bitcoins Are Going Legal – Major institutions such as the Bank of England and the Fed have decided to buy Bitcoin for trading. More and more outlets like Reddit, Pizza chains, WordPress, Baidu and many other small businesses now accept Bitcoin payments. Many binary trading and Forex brokers also allow you to trade with Bitcoins.

Bitcoin is the pioneer of the new cryptocurrency era, a technology that gives you a glimpse into the currency of the future.

Big question about how to get bitcoins.

Once you have a basic understanding of what bitcoin is and how a wallet actually works, you may want to dive into the world of digital currency and get yourself some bitcoins. So, the big question comes to your mind: How can I get bitcoins?

To be difficult.

After learning about the origin of each bitcoin based on the mining process, you will believe that the best way to get them is to join this mining process. The thing is, this has become very difficult because the popularity of cryptocurrency is increasing rapidly.

Sell ​​products or services.

Each bitcoin comes as a result of a previous transaction. So the way to get them when you don’t have them is to get a transaction from someone else when you buy with cash or by mining new bitcoins.

When you know someone who uses bitcoins, you can ask them to buy bitcoins. If you don’t know anyone who has them, you can get bitcoins by suggesting another type of transaction with another bitcoin user, resulting in you being paid in bitcoins. An alternative option is to remove them yourself.

Mining.

If you can’t buy bitcoins from someone else, you can get them by mining them. Here the term mining means: solving a complex mathematical problem with the aim of validating the transactions of other people. In return, you are rewarded with bitcoins. Receiving bitcoins is sometimes free, but sending them may involve a fee, depending on the online platform you use. Before you start mining bitcoins, you should understand that this is not an easy way to get bitcoins, it requires some technological knowledge, which may not be practical for you.

buy

If you don’t know anyone who owns bitcoins, if you don’t have anything to sell to exchange for bitcoins, there is a way to buy bitcoins. There are several online platforms that sell bitcoins through a process called trading/exchange. Here are some ways you can get bitcoins:

Buy bitcoins from a person.

There are online markets where you can buy bitcoins in a person-to-person scheme. You can pay these people in cash or in other ways. A good idea is that you and the seller can arrange a payment method: cash in person, cash on deposit, bank transfer, PayPal, etc. The key element here is to find someone you trust. A good tip is to use an online deposit service, this way you can protect yourself from any kind of fraud. The good thing about this online savings platform is that everyone has to upload a scanned ID card, which guarantees security during transactions.

Buy bitcoins from an exchange and point of sale.

Bitcoin exchanges or outlets are basically online services that make it easy for buyers and sellers to transact bitcoins. To be a part of one of these, all you need to do is create an account and verify your identity before buying or selling bitcoins.

Buy bitcoins through an ATM.

Some cities around the world offer physical bitcoin ATMs. You simply get your bitcoins using your local fiat currency. Governments regulate the use of these ATMs for security purposes. Sometimes it can be difficult to find a bitcoin ATM near your location because even where they are installed is regulated.