A Beginners Guide To Bitcoin
Introduction
Are you new to the world of cryptocurrencies? If so, you may be wondering what is bitcoin and how does bitcoin function in a highly competitive global economy today? This guide is written for those who know little or nothing about bitcoin. With the information provided here you will be empowered with the most fascinating and fundamental aspects of cryptocurrency design, use and infrastructure. This powerful knowledge will allow you to forever understand the greatest revolution that we call cryptocurrencies in the twenty first century. We hope you follow along and enjoy this guide.
The History of Bitcoin
The design of bitcoin is simple and beautiful, a peer to peer electronic currency system delivered to the world. It requires no permissions, it has no single governing authority, it runs simply on a decentralized network and by this bitcoin is run by the world. The first genesis block of bitcoin was mined by Satoshi Nakamoto on January 3rd, 2009. Stored inside the genesis block was a statement warning of the instability of traditional fractional reserve banking systems. Since then blockchain mining has been continued and adopted by the world. The list of innovations created since is almost limitless and includes: initial coin offerings, alternative coin projects, new blockchain technologies, worldwide speculation, cryptocurrency exchanges and a more recent explosion of related interest. An inquisitive mind might wonder how much of this did Satoshi Nakamoto foresee?
Who Is Satoshi Nakamoto?
Before traveling further lets take a glance at bitcoin’s creator. The person who authored bitcoins white paper and successfully deployed bitcoins first blockchain is known only by one name, Satoshi Nakamoto. This unknown person or group has seemingly since then vanished into the crowd, leaving behind a legacy of mystery. He is seen as a leader to the countless and faithful around the world, those who can follow Satoshi’s vision and design. The lore behind this mystery and the man will likely live on as most legends do. With his vision, the world has found endless potential in blockchain technologies and they have all developed well beyond initial expectations. Understanding the many uses of blockchain technologies sharpens our worlds perception of the future electronic currencies and digital archiving solutions.
Related Terms
A blockchain is simply an archive of digital records. Every new individual block in the chain has a record of the previous block, a timestamp, and serves the purpose of recording new data entered into the system. The blocks and data are linked together via cryptography. The term cryptography refers to using encryption to store data safely in the face of adversaries. Thenceforth blockchains are securely managed by distributed ledgers. A distributed ledger is a computerized ledger that manages transactions throughout the blockchain. Is is true that accounting ledgers have been widely used throughout history, only recently new advancements in computing have allowed electronic ledgers to be distributed throughout the world via node networking systems. Each node independently records data and then votes to ensure the majority of nodes on that network agrees on the results. This verifies that all information is correct and the database is then updated. Multiple nodes operating around the world creates a world wide node network system.
How To Buy and Store Bitcoin?
Storing bitcoin anywhere other than an exchange requires downloading a bitcoin wallet on your device. With this wallet you can send bitcoin to a receiving address for storage. For every new wallet created, a private key and a public key are generated via encryption. The key creation and encryption process is irreversible and secure. A public key is similar to an email address that can be shared with anyone. With your public key you can send and receive bitcoin safely and securely.
Public Key Example: DeXt2ne8pOvrxSme90wapEgdxm3ltomX
A private key is a much longer unique signature that should never shared, stored or revealed to anybody. With this key your funds can be accessed from anywhere in the world. Adding extra security protocols like 2 factor authentication to your accounts is strongly advised. Most cases of theft are caused by a mistake in either of the two aforementioned statements or poor data storage management. For convenience and flexibility you can also store and trade cryptocurrencies on secure trading platforms, by far my favorite and one of the most secure is Coinbase.com.
Advantages of Bitcoin
Still today the main features of bitcoin are safety, security and speed. Bitcoin may be purchased at multiple exchanges around the world in real time, at your convenience 24 hours a day and 7 days a week. There are no time or border restrictions. Imposing regulations and taxes by governing territories is still currently up for debate, likewise certain countries have placed domestic laws preventing trade on their land. Otherwise, there are no excessive fees related to using bitcoin. Bitcoin, unlike the stock markets or traditional banking systems is built with freedom and flexibility in mind.
The conveniences of spending bitcoin are expanding every day: It can be used for purchases at supporting retail outlets, online payments for goods and services, cash withdrawals from bitcoin ATMs, and for financial investing and trading. Unlike the U.S. Dollar or Chinese Yuan bitcoin is not necessarily meant to hold one stable value, instead it is flexible depending on worldwide demand and availability. One day the last bitcoin blockchain will be created along with the last 50 bitcoins. The number of bitcoins that can ever exist is 21 million, this is a finite number, that number can never go up and demands increase almost daily. If demand continues rising so will the value of bitcoin. As a worldwide finance vehicle bitcoin strengthens a our communities, supports new tech startups, enhances better business to business relationships and flexibly allows worldwide commerce. In a grander view cryptocurrencies can bring together our interests and economies allowing a whole new world of possibilities.
It’s getting harder and harder to be a crypto skeptic. Live digital cryptocurrency exchanges allow all people without prejudice to trade from anywhere in the world instantly.
You will find all major cryptocurrencies available for trade on secure trading platforms like Bittrex.com and Coinbase.com.
If your interested in mining cryptocurrencies instead of directly purchasing them, consider joining a cloud mining site.
Coinbase.com
Coinbase.com
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