As the third most searched term in google currently, Bitcoin has taken over the world in just ten years. In this video, we’ll be talking about things you need to know about digital currency. From its history, why it’s such a big deal, to how it operates, and of course, how to get started if you’re interested in investing in it.
Bitcoin’s History
The decentralized digital currency that can work without a bank started initially in January of 2009 when Satoshi Nakamoto mined the genesis block of bitcoin and was rewarded 50 bitcoins. This was groundbreaking at that time because most of the currencies in the world revolved around trusting the value of gold.
In the past, people paid for things through bars of gold. Banks and governments took bars of gold and exchanged their values for money. When they got tired carrying bars of gold around, they invented and transitioned to paper money.
People trusted the government with how much value their paper bills held, and up until now, it’s how it works. Money’s worth is centralized and controlled by governments and is not limited in quantity. Even though it has worked for a lot of years now, this system is still dangerous.
Bitcoin was a game-changer. Although money’s value wasn’t exclusively physical and a lot of digital forms of money were immediately introduced like credit cards, it still holds the same problem. Money was still centralized, and there was no way to avoid cheating and double-spending problems without a central authority which was prone to a lot of corruption.
The normal person may not see it that way, but that much power is scary. Bitcoin changed this by incentivizing people through a decentralized system that aims to still provide the same level of convenience that money has while ensuring that it isn’t prone to collapsing and destabilization.
How It Works
The main fundamentals that separate Bitcoin from banks is that it’s able to work without a central authority. This unique ability to operate without a central figure is what Bitcoin markets. Banks need a central figure to handle their ledger that contains notes of all the transactions and data stored. Bitcoin does completely the opposite, being transparent with their ledgers and operating 24/7 as opposed to most banks.
However, although Bitcoin IS transparent with their ledgers, transactions, and balances, people won’t be able to find out who owns these balances and who does the transactions. In short, Bitcoin is pseudo-anonymous. Another essential thing to note is that with bitcoin, every computer that participates in the system keeps a copy of the ledger, aka the blockchain, which makes it virtually impossible to hack bitcoin.
Investing in Bitcoin
In 2021, investing in this high-risk yet also high-reward cryptocurrency is very simple. To invest in bitcoin, you generally only need a couple of person identification documents that prove you are a real person, bank account information, and a secure internet connection. Bitcoin investing can be done both personally and through stockbrokers.
First, you have to join a Bitcoin exchange to determine where you want to make a Bitcoin purchase. Coinbase, Binance, Kraken, Gemini, and Bitfinex are great options. Next will be to secure a Bitcoin wallet where your purchased coins are stored. There are two types of wallets. Hot wallets like Electrum, a software that enables you to store coins on your computer, or Mycelium, which is a mobile app for Android and Apple Users. Cold wallets, on the other hand, are actual pieces of hardware that store your coins. Examples are Trezor and Ledger Nano.
Once you’ve chosen where to buy and have secured a wallet, then you’ll have to connect your wallet to your bank account. Afterward, you’ll be ready to purchase, transfer, and transact with your bitcoins.
For Bitcoin investments, there are quite a lot of options out there, but the usual route would be to hold your coins for an extended period and wait for their value to appreciate.
Disclaimer! – crypto is exciting, but very volatile and risky, so this post and any content related is for entertainment purposes only! For more trending video’s be sure to visit often (an leave us a comment below!
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