What Is Bitcoin?
Why is everyone raving about it these days?
How to buy Bitcoin in Pakistan?
If these are the questions circling around your mind then you are among the many curious souls that are waiting to hear the tale of Bitcoin.
Before being introduced to the world, Bitcoin has been considered no less than a fantasy and today it is actually the most efficient version of digital currency.
In order to make you understand what Bitcoin is and how does it work, we have created this beginner’s guide just for you.
However, before diving straight into the workings and benefits of Bitcoins, we want you to know that it is highly speculative to invest in tokens and crypto coins and their market is unregulated at large. Therefore if you are seriously considering investing in it, prepare yourself to lose a large sum.
A Brief History Of Bitcoin
Initially, Bitcoin was an established cryptocurrency that could be exchanged like normal currency and is secured with cryptography. Although, before Bitcoin, countless versions of cryptocurrencies were launched, none of them could ever develop themselves.
Bitcoin was officially launched in 2009 by an anonymous entity called Satoshi Nakamoto, whose real identity is a mystery even today. Some believe that Satoshi Nakamoto is the name of a group while others are convinced that it is an individual.
Irrespective of who brought Bitcoin into existence, the goal of Bitcoin is to create a new electronic cash system, which is completely decentralized with no server or central authority.
What Really Is Bitcoin?
Bitcoin in simplest words is a form of digital currency that has no tangible aspect therefore, there are no bills for print and no coins to mint. Since no government or financial authority is in charge of it, it is completely decentralized.
Furthermore, there is no way one can reach the owners of Bitcoins. There are also no names, social security numbers, account numbers or anything that could reach you to the owners of Bitcoins.
Bitcoins use encryption keys and a technology called blockchain to connect the seller with people interested in buying. What is even more interesting, Bitcoin also gets mined like diamonds and gold.
How Are Bitcoins Mined?
People or the very powerful energy-fraught computers mine Bitcoins so that more of them could be generated.
Each Bitcoin undergoes division and the smallest fraction of it is one hundred millionths of the bitcoin, this fraction is called ‘Satoshi’ and it is named after the finder of Bitcoin.
The process of mining involves much of computer work, where computers are tasked to solve progressively hard mathematical challenges.
With every mathematical problem is solved, one block of the Bitcoin gets processed and the miner receives a new Bitcoin.
How Are Bitcoins Used?
There are also other ways to earn more Bitcoins besides, mining Bitcoins. First, you can accept Bitcoins as a way of getting your services and goods. Setting up the Bitcoin wallet is just as simple and easy as getting yourself a PayPal account.
Having Bitcoin also helps you keep a safe store, track your money and spend it. While it might seem as though, so much of your precious time is being wasted in the process, all of this is only worth it, because certain websites that pay also pay you Bitcoins after you complete a certain task.
After earning the Bitcoins, you can lend them out and earn your interest. As matter of fact, there are also ways through which you can earn more Bitcoins by trading. Moreover, you can very easily trade your regular currency for Bitcoins at a Bitcoin exchanger.
Are There Any Risks?
By using Bitcoins you can enjoy many perks, however, there is definitely a great risk too. Bitcoin has great appeal for high-profile criminals that want to stay anonymous and confront no regulations. However, on the bright side, it is easy to look past the risks for Bitcoin, as it provides lots of benefits.
If Bitcoin gets stolen, it can be really difficult to resolve the issue because Bitcoin does not have any governing body to take charge in crucial times. Furthermore, if your transaction on Bitcoin hits the blockchain, there is no way you can stop it. Bitcoin is also a new service, that is why there are still lots of unknown factors. The value of Bitcoin also continues to change on a daily basis.
Bitcoin is a great way to smartly and store your money. Although, it can come with certain peculiar challenges the perks that Bitcoins provide make it all worth it.