What is Bitcoin

What is Bitcoin? Read our exploration of this new phenomenon and the crypto-currency revolution...

1. What is Bitcoin?

Bitcoin is a form of electronic cash or what is now known as a cryptocurrency.
It can be sent peer to peer on the bitcoin network, this is done directly without the need for an intermediary.
It is a digital currency which is decentralized without the need for a controlling central bank or single administrator.
This can obviously make this currency appealing to the darker side of life - the criminal underworld.
Bitcoins can be exchanged for other currencies, services or products. Many older people wonder what is Bitcoin really for and state that it has no value!

Initially, when they were mined they were virtually worthless - it cost literally cents to buy one single BTC.


2. What is Bitcoin and how does it work?

With Bitcoin network, 'nodes' verify transactions through cryptography then recorded in a publicly distributed ledger called a 'blockchain'.

What is Bitcoin Blockchain? Put simply is a way to send information. Or make a transaction with anyone on the globe, relatively quickly and securely.
What is Bitcoin is generated as a 'prize' for a process called 'mining'. This term refers to the solving of complex equations that take huge amounts of computing power.
Add to that, theft from exchanges and the possibility that bitcoin is an economic bubble. Liable to pop at any time. It is no wonder people invest with 'squeaky bumcheeks'.
Thankfully and likely due to bitcoin itself the industry as a whole should become properly regulated. Most of the initial worries die away.

Blockchain, crypto & A.I. will have deeper and more intricate part of the financial system than we realize.

It has also set the stage for how a decentralized currency should operate. It also proved that the concept can actually work.

3. What is Bitcoin inventor called?

What are Bitcoins - YouTube Video

Bitcoin was invented by an unknown person using the alias Satoshi Nakamoto. The concept was released as open-source software in 2009.
On a P2P network profile, 'Nakamoto' claimed to be a man from Japan - DOB - 05/04/1975.
Many have speculated on the true identity of Nakamoto. They have focused on a group of cryptography and I.T. science experts of non-Japanese origin, living in the US. Many people ask what is bitcoin created for if not for wealth? And what is Bitcoin creator hiding from?
It is notable to add that Satoshi Nakamoto also created the bitcoin talk forum and posted his first message in 2009 under the alias Satoshi!
This all deepens the intrigue for hardened conspiracy theorists who suspect that perhaps Bitcoin was created by the ruling elites.
Some say to softly slowly guide us into the world of a cashless society.

A brief explanation of cryptocurrencies - image from etoro.com

4. What is Bitcoin used for?

In 2017, research compiled by the Cambridge University estimated that 2.9 to 5.8 million individual users were actively using a crypto-currency wallet. With most of them using bitcoin.
The controversial crypto token has been criticized for being used in illegal transactions. Also its high electricity consumption during mining plus its high price volatility.
The cryptocurrency has been alive for nine years now and there are around 16 million coins in current circulation.
It is unknown how many individuals own Bitcoin crypto-currency.
In-depth studies and surveys have indicated that of the richest 10% of the globe, 90% of them are in ownership of the digital currency.
In the beginning, people have been highly skeptical but a hype developed and many have felt compelled to invest.

Bitcoin has been used as an investment through several regulatory agencies. They have issued stark alerts and warnings regarding trading in the crypto-currency.

5. What is Bitcoin stored in?

It is vital to begin by getting yourself a trustable wallet.
Before you buy you need to download a Bitcoin wallet by going to a site like Blockchain.info. Or a mobile app such as Bitcoin Wallet for Android or Blockchain Bitcoin Wallet for iOS.
The leading UK-registered exchanges to buy bitcoin are Coinfloor and CEX. Both require a user ID and are more tailored towards businesses and active traders.
Exchanges such as CoinCorner, etoro, plus 500 appear to be geared towards the individual investor - you or me.
Other international exchanges such as Coinroom in Poland and Kraken in the US are also great places to purchase your cryptocurrencies.

6. What is Bitcoin blockchain?

Blockchain put simply is a way to send information. Or make a transaction with anyone on the globe, relatively quickly and securely.

A blockchain is a public ledger recording transaction. It implements itself as a chain of blocks and each block contains a hash of the last block up to the genesis block of the chain.
Maintenance of the blockchain is done over networks of communicating nodes.
Network nodes validate transactions and add them to their own version of the ledger, and then broadcast the ledger to other nodes.
Achieving independent verification of the chain of ownership each network node stores its own version of the unique blockchain.
Every 10 minutes or so a new group of accepted transactions known as a block is created.

7. Bitcoin and Blockchain - the Future or just a phase?

Bitcoin might not be the Answer we are looking for.
The blockchain technology provided by the cryptocurrency is just one solution of many to which there are many problems to work on.
Not only is it the first cryptocurrency Bitcoin has reputation and prototype/novelty level added value.
It has also set the stage for how a decentralized currency should look like and proved that the concept can actually work.
Bitcoin has been a global experiment and a successful one at that. Its predecessors such as Ripple, Neo, Litecoin, Ethereum etc have Bitcoin to thank for trailblazing the way for future cryptocurrencies.

Hopeful for Crypto-currency

What is Bitcoin lifespan? No one can know this but we do know that mining will cease eventually! Undoubtedly to my own mind Bitcoin has set the stage for the next revolution of money.
From the feudal system of swapping a goat for a pig, coins to paper money. Blockchain, crypto, and A.I. will have deeper and more intricate part of the financial system than we realize
Hopefully, this is a future of financial freedom from the slavery of the modern FIAT system.

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Paul Nelson 2018


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