Bitcoin Review For Beginners
The debate over Bitcoin continues to increase every day.
Many argue against its efficiency as a form of currency. Others acknowledge that it’s vital to promote Bitcoin to increase awareness of other cryptocurrencies but will become less critical after better options for exchanging value arise.
However, the reality is that it’s still the most famous crypto coin in the market, and it’s easier to find someone interested in Bitcoin than in any other cryptocurrency.
Let’s dive in and discuss what Bitcoin is and has to offer.
What is Bitcoin?
Bitcoin is a cryptocurrency born in 2009 with the launch of Satoshi Nakamoto’s whitepaper.
Bitcoin comes from encrypted and codified computer code. These coins are independent of governments and nations and do not operate under any central system.
Bitcoin, like other cryptocurrencies, is part of a blockchain. An encrypted system for handling and recording digital coins, also known as Bitcoin, Altcoins and cryptocurrencies, and their transactions.
Bitcoin requires a digital wallet for storage and processing. The wallets contain strings of characters, with numbers and letters, that make up the wallet address. Each sequence is unique, so there is not a possibility of a duplicate wallet being created.
Bitcoin’s idea is to be a secure digital currency used for peer to peer transactions.
You can acquire Bitcoins in two different ways:
The first one is mining: the miners use specific computers to solve complex equations; this records transactions and rewards them with Satoshis. The Satoshi is the basic unit of Bitcoin, where a million satoshis make one BTC.
The second one is through an exchange, i.e., Changelly, where you can exchange fiat for Bitcoin or trade another cryptocurrency such as Ether for Bitcoin.
What is Bitcoin Used For?
Bitcoin’s use started in technological platforms such as websites and applications.
Nowadays, the use of Bitcoins has evolved to surprising levels. In some regions, it is common to pay with cryptocurrencies for everyday goods and services. Operations are instantaneous and secure. You can send Satoshis or BTC to other users with a simple click or a QR code scan.
The number of users and companies using this method is increasing. Wallets and tools centered around ease of use are on the rise. All these elements indicate a growing trend for the Bitcoin market.
The exponential expansion of Bitcoin led to the creation of global communities, academics, and national and international markets for the exchange of Bitcoin.
The organizations formed around Bitcoin are varied. The best known is the Bitcoin Foundation. It’s an organization born in the United States to help with Bitcoin’s development. Bitcoin Foundation sets the standards of operations to ensure their continued security and transparency.
The organization started in September 2012. Its objective is to standardize and promote the use of Bitcoin around the world.
The Bitcoin Foundation follows a similar path as the Linux Foundation. It’s completely independent and non-profit. Its capital comes from private investment; these investors are primarily firms that depend or operate around Bitcoin and members of the BTC community.
Its most notable members include Peter Vessenes, Gavin Andresen, Bobby Lee, and Elizabeth Ploshay. Many members have left over time, and others have stepped in to fill their spots. A community vote elects the foundation leaders.
The Bitcoin Foundation runs all updates for the platform. However, it’s been under public scrutiny over some of its decisions. Most notably, decisions regarding adaptations like The Lightning Network which had a small role to play in what caused the infamous fork that resulted in Bitcoin Cash, which hoped to make Lightning Network obsolete.
How Bitcoin Works
Bitcoin is a pure and simple system that even the most technologically neophyte can use. Bitcoins work through virtual wallets associated with the Blockchain. The wallets have a unique address that identifies each user.
The Blockchain is what records transactions; however, it’s also what makes it possible to use these coins. It is a sophisticated accounting system that ensures the transparency and security of any purchase.
The Bitcoin owners can transfer Bitcoin or fractions of a Bitcoin using each wallet’s address. The operations are working inside the Blockchain, where the service is verified and carried out. The procedure usually lasts between 5 and 10 minutes.
People can access and use their coins through web platforms and digital apps. On the PC, we can have desktop and web applications to access our purse and send BTC. In smartphones, it is more straightforward: the apps contain a scanner for QR codes. The information goes to the Blockchain and operates in seconds.
Users only need to open their mobile app, scan the code, and enter the amount they want to send.
At this point, let’s look at the features that make Bitcoin practical.
- Bitcoin is a secure currency; it uses an encrypted system to protect the information. Transactions are protected by the Blockchain at all times, avoiding problems.
- The system is free of central control.
- Bitcoin is an independent currency, which is not regulated by any entity. It is not subject to regulations within countries, which frees it for international free use.
- The currency is free from inflation.
- The coin offers real value; it does not have a solid backing like gold. Bitcoin, like all cryptocurrencies, is working on trust. The value increases as the level of transactions within the global market increases.
- Applications to obtain Bitcoins are increasing in number. The problem is that some of the apps are scams. An example is the bots that recently emerged in Telegram. Bots offer the opportunity to get Bitcoins; many ask for investments but never pay.
- While it is accepted in several countries, the issue is that many populations are reluctant to accept cryptocurrencies. One example is the countries of Latin America. Argentina, Peru, Bolivia, and others are not legalizing this currency as a form of payment as of mid 2019.
- For the mining process, each user requires high-powered equipment. A high-speed processor, high capacity RAM, video cards. Some examples of equipment needed for a decent mining speed. The investment to acquire these types of equipment is extraordinarily high.
Final Thoughts on Bitcoin
The world continues to advance when it comes to technology. It is said that Bitcoin and other cryptocurrencies are the future. Bitcoin is growing at incredible levels and is increasingly influencing the use of cryptocurrencies in international markets.
Getting into Bitcoin can be intimidating for first-time users. With all the tools available now, it can be overwhelming to know which platforms and tools are the best for purchasing, exchanging, and keeping your crypto safe.
That is why we created a list of battle tested tools that have been around, have excellent community feedback, and have a positive record for keeping your crypto secure. You can see all the tools here.
Hopefully, you found this beginners look at Bitcoin helpful. Be sure to take a look at our other reviews and articles to be better equipt to maneuver through the crypto market.