As bitcoins continues to create buzz across the world, let learn the basics of bitcoin.
Bitcoin is essentially a digital currency that unlike any fiat money is not owned by countries or central authorities. It is governed by the huge community if bitcoin users and is free from any corporate monopoly too. Its secure digital nature makes it easy to transfer all over the world that too at a very low expense. More and more individuals and businesses are adopting and accepting bitcoin as transactions are secure, faster and anonymous.
A bitcoin user uses a digital wallet to store, spend and receive bitcoin. While installing a bitcoin wallet a private key also known as ‘seed’ is set up. It ensures the safety and security of a transaction while the wallet is used.
Bitcoin works on the blockchain technology that is basically a shared public ledger on which the entire Bitcoin network relies. Any confirmed transactions (including newly added bitcoins) are added into blockchains. The ledger is maintained by the public & anyone can use the ledger to match a transaction.
Bitcoin mining involves complex mathematical calculations for the Bitcoin network users, to confirm transactions and increase security. Those who use their computers and resources for bitcoin mining are called miners.
When you make a Bitcoin transaction, your Bitcoin software uses your private key to signs the transaction cryptographically. Unlike normal transactions, here you don’t give our personal details. Only the wallet address is visible and this ensures anonymity & safety.
Bitcoin was made available to the public in 2009 by an anonymous Satoshi Nakamoto whose goal was to create “a new electronic cash system” that was “completely decentralized with no central power or authority.” In the year 2010, a person sold 10,000 Bitcoins for the first time to purchase two pizzas. Now, Bitcoin is widely accepted all over the world in different fields, and its future is beyond the imagination.