• Bitcoin 4

Bitcoin

• What is bitcoin mining?

  Bitcoin mining is the process of adding transactions to the blockchain and confirming those transactions to the rest of the network. Bitcoin miners verify transactions, keeping the bitcoin network secure and functional. The primary purpose of mining is twofold. First, mining allows bitcoin nodes (any computer that is running the bitcoin program) to reach a secure, tamper-resistant consensus. Second, mining is the process in which new bitcoins are introduced into the system. By achieving these two primary goals, miners are paid fees for verifying transactions as well as for created any new coins. Historically, bitcoin mining was a relatively profitable practice but unfortunately it came with diminishing returns. The computational power required to create new bitcoins becomes exponentially more difficult as more and more are introduced into the system. Currently, bitcoin mining is widely considered to no longer be a profitable means of acquiring bitcoin because the cost of purchasing expensive computational hardware combined with the cost of the electricity required to operate the hardware is so high that even breaking even, let alone making a profit, is for the most part unrealistic.

• How to buy bitcoin?

   

  1. Sign up for a Bitcoin Wallet

  In order to buy bitcoin, you must first download a bitcoin wallet or sign up for an online bitcoin wallet like Coinbase and create a bitcoin address (ex: 3EfKz5Mo7fvL9byK15527xCiDhxs1bVD25). Your bitcoin address is where bitcoin is sent to and from so it ends up in your wallet.

  2. Sign up for a Bitcoin Exchange

  Once you have your bitcoin wallet and your bitcoin address you will need to send bitcoin to your address in order to see the funds in your wallet. This step requires whats known as an exchange, and it works just like exchanging money when you travel overseas and need to exchange your home currency for the local currency. As an American, when I travel to Europe, I need to exchange my U.S. dollars for Euros and the same goes for bitcoin. Coinbase is a very popular option because it works as a web based bitcoin wallet as well as an exchange, so you only need one account to manage your wallet and exchange traditional currency for bitcoin.

  3. Use a debit card, credit card, or bank transfer to buy bitcoin

  Once you have your Bitcoin wallet, you can use traditional currency to buy bitcoin with a variety of payment methods including debit cards, credit cards, and even bank transfers (ACH). The Bitcoins are then transferred to your wallet, and will remain there until you send them to another wallet.

• Who created bitcoin?

  Satoshi Nakamoto is the creator of bitcoin. Satoshi Nakamoto is a pseudonym of the person (or persons) who developed bitcoin, and while many people have tried to claim they are the true idendity of Nakamoto, none have proven to be valid claims and the real idendity of the creator of bitcoin remains anonymous to this day. Nakamoto created and deployed bitcoin’s original reference implementation following his publication of the original bitcoin white paper, making him the disputable creator of bitcoin. Nakamoto is also known for creating the blockchain database, the underlying technology all cryptocurrencies are built upon. Nakamoto created bitcoin in 2009 and was active in the development of bitcoin up until December 2010. In April 2011, his last official email said “I HAVE moved on to other things.” Nakamoto has not been heard from since.

• What is bitcoin?

  Bitcoin is a form of digital currency formally known as a cryptocurrency. Bitcoin was the first official cryptocurrency which refers to a new form of decentralized digital currency that is not controlled by any single administrator or central bank and can be sent freely through a peer-to-peer network (known as the blockchain) without the need for intermediaries or any form of traditional payment processor. Bitcoin was created by Satoshi Nakamoto in 2009, and is still to this day the most widely used and most valuable of all 1,600+ cryptocurrencies currently in existence.