What is Bitcoin?
Bitcoin is a decentralised digital currency. That is, we are talking about a digital economy, on the computer, which is not issued by a central bank or a leader to control it. I’ll take them one at a time:
- Bitcoin is digital currency – that is, the whole economy, all the rules, is based on a computerised protocol. It’s controlled by an open-source protocol that everyone can access.
- Bitcoin is decentralised. That means no one is at the top to make decisions that influence price, inflation and so on. It’s basically a democratic currency. If there is a change that protocol needs, then a kind of vote is organized. Let’s say a developer wants to add something new to the Bitcoin protocol. Write the code, put it on GitHub, where Bitcoin users can download it. If more than 50% + 1 of users download that code, then it becomes the official part of the Bitcoin protocol
Bitcoin can be used as a value storage or as a value transport.
- As value storage because his price constantly increases. It has ups and downs, pumps and dumps, like any other assets, but overall the price increases due to adoption and the fact that there is a limited amount of bitcoins that will appear in total on the market, of 21 million. The higher the demand, the more the price increases. So far, the popularity of bitcoin has grown steadily, so the price has increased to the same extent. Those who in the year 2015 bought a bitcoin for the price of 300 dollars, today they sell it for the price of 6500 dollars.
- I’m saying it’s interesting as a stock shipment. Let’s say you want to send money from abroad to the country, or vice versa. Through banks, charges are levied on each operation in the form of commissions. Bitcoin has a smaller commission no matter how small or large the transaction is. So you get rid of a series of bank commissions, sending money through blockchain.
Mine is the process of generating Bitcoin. Basically, you have to consume power and provide network processing power and you are rewarded with Bitcoin. You’ve consumed electricity, you’ve put processing power on your network, you get proof of work and a reward in Bitcoin.
At first he could hand with the computer (PC), because the difficulty of mine was small. I mean, in the competition for the same Bitcoin there were fewer participants. Then it could be mine with the computer (PC) on the profit. As time went by, the difficulty of mining increased, and it was reached in the situation where the minefield with the computer (PC) is no longer profitable.
The second stage was the emergence of mine pools. I mean, more people were making a collection of resources and mining together for bitcoins.
In time, miners appeared, which only consume power and provide network processing power, generating bitcoin more efficiently.
That’s what a Bitcoin miner looks like. This is about Antminer S9 the most profitable Bitcoin miner
Bitcoin Wallet is a digital environment. We need to understand what Bitcoin is and not expect anyone to give us the physical banknotes that 100BTC says. So bitcoin is a piece of information, and the wallet stores it under Formula X has so many bitcoins.
The Wallet records the transactions you make and remembers. You got so much money in August, you bought Bitcoins in the summer and sold it in December, bought electronics in November. All this is stored in your electronic wallet, which is a serial number associated with you. I mean, it’s like a bank account. At the bank you deposited so much money in February, you paid with your card at the hypermarket, paid your bills and so on. And the banks alike, they store the information, only that there to store your information requires a commission. The Bitcoin wallet records your finances without paying the administration fee.
This is your savings card from now on, and you have to treat it as such. Do you know what’s going on? Many don’t treat this thing seriously. I pățeam this thing and the card when I first used it. I was going to go shopping, if I paid cash, it hurt my soul, if I put the card in, I thought I didn’t pay, I felt like a hacker. It’s not like that. These is Money folks! And there are large sums, which with time become even bigger because bitcoin grows in value. So do not play with your password/private key, that you will be sorry in the future.
Now, let’s see how the Bitcoin wallet connects to your identity. Bitcoin is Pseudoanonim. I mean, it generates a serial number (1Lc6M9CkRTJ1cxPWqZX7GKqtk3znAM3JMZ), which has no connection with my identity as a person. I’m Ike, nowhere do you see my name here. If I buy 30 pairs of skis in bitcoin tomorrow, nobody knows that I, Ike, bought 30 pairs of skis. The transaction shall be recorded instead in a public register.
I, serial number XYZ, have paid a sum of 5 BTC to the serial number ZYX, which is associated with a sports equipment store. If tomorrow, the same serial number makes the payment to a gambling site, then someone can draw the conclusion – this guy who has the XYZ serial number is passionate about some sport and breaks money at slots. You understand where I’m knocking? So yes, Bitcoin is anonymous, but the transactions you make on the same wallet are recorded together. So you’re not going to give your public address on a wallet that you pay to gamble a serious investor. It’s good to generate more transaction addresses to manage differently if you really want to remain anonymous.
Besides, this anonymity thing keeps as long as you know what you’re doing.
Bitcoin is a financial experiment started in 2008 and evolves every day, and demand is great for a decentralised system.
Bitcoin cannot be stopped or banned one says Kathryn Haun, U.S. federal prosecutor, who talks about Bitcoin in an interview with Forbes magazine.