Bitcoin Education for a Newbie
Bitcoin, the word has been in the market since 2009. However, it was only 2011 when people started realizing that it can make them millionaires. But you being a newbie need to study all the different aspects of bitcoin and the crypto market before you start investing. The money you earn is large but making sure your strategies must be good enough to reach there is all you need to take care of. Let’s have a brief intro about the crypto market and bitcoin.
What is Cryptocurrency?
Cryptocurrency is a digital currency and works on blockchain technology. It has been
designed in such a way that you can buy goods, services with the exchange of these currencies as a payment option. Since it is decentralized, there is no control of government or bank. Therefore, it helps it to make faster transactions.
There is no transaction or almost zero transaction cost using cryptocurrencies, and no transactions limit which makes it reliable as compared to the traditional systems of money exchange.
What is Blockchain?
Blockchain is a set of blocks that records information in batches, like who made the
transactions to whom. These blocks are linked with each other in a chronological order to form a continuous pattern forming a chain. If a change is to be made in a particular block, that does not
edit the block but adds another block to the chain which reduces the chance of data
tampering.
What is Bitcoin?
Bitcoin is the first digital coin that introduced people to the cryptocurrency market. It was announced in 2008 and launched in 2009 by Mr. Satoshi Nakamoto. No one knows who Mr. Nakamoto is, the benefit of which is even if something happens to Mr. Nakamoto, it won’t affect the price of Bitcoin. Bitcoin being a digital currency, cannot be held physically. With a limited supply of 21 million Bitcoin, only 18.6 million could have been created yet. Bitcoins are in circulation in counties across the world. It can be traded on the cryptobnb.
How bitcoin is operated?
Bitcoin operates without a central authority and is transparent. This nature of Bitcoin allows
anyone to go through any transaction and balances that are taking place without knowing
who was behind those transactions?
It can’t be controlled by any bank or any country’s government. Bitcoin is decentralized in nature which means that there is no single computer holding the ledger, there are thousands of computers. So, to take down the system or hack the ledger, you have to take down thousands of ledgers.
Since bitcoin is a digital currency, if you own Bitcoins, only you have a right to access a specific
address record in the ledger. It is cheaper to use over any traditional way of transferring money as there is no middleman or broker involved and it can be used to make international transactions as well.
What is Bitcoin Mining?
If you use Bitcoin to make a payment, there should be someone to verify that transaction, and here comes the miner. The transaction is in a coding language just like a mathematical
the problem, which the miner solves, and as a reward the miner owns the Bitcoin himself.
Bitcoin is generated via mining up to a certain finite number i.e. 21 million only unlike any
other cryptocurrency which can be created unlimited.
Is Bitcoin Mining worth the reward?
Bitcoin cannot be mined using general hardware, it requires high configuration computers
which costs a lot. It takes a lot of time to generate a Bitcoin, so the consumption of electricity is quite high.
Previously, in 2009 to generate 150-200 Bitcoins it would take 2-3 days but today, to generate 1 Bitcoin might take more than 150 years, the reason being the competition between the miners, which now has eventually made bitcoin mining much more expensive than the amount of reward in return.
In the beginning, bitcoin was not well recognized. However, one can now use bitcoin instead of their physical money in platforms where it is available. But one should not ignore the fact that investing money in the crypto market can make you lots of money and can also drain all of it at the same time. Being a highly volatile market, rewards and risks go hand in hand.
