What Is Bitcoin, How Is It Different Than "Real" Money and How Can I Get Some?

Bitcoin is a virtual currency. It does not exist in physical form like the currencies and coins we used before. It does not even exist in physical form like monopoly money. It’s an electron-not a molecule.

However, please consider how much cash you handle personally. You will receive a paycheck deposited in the bank-otherwise the check will be deposited in the bank automatically and you will not even see the unprinted paper. You can then use a debit card (or checkbook if you are an old school) to obtain these funds. At best, you will see 10% in the form of cash in your pocket or wallet. Therefore, it turns out that 90% of the funds you manage are virtual-electronic in a spreadsheet or database.

But wait-these are US funds (or funds from which country you are from), safe in the bank and fully guaranteed by the FDIC, up to about $250,000 per account, right? Well, not exactly. Your financial institution may only need to keep 10% of its deposits as deposits. In some cases, it is even less. It lends the remaining money to others for use for up to 30 years. It charges them loan fees and charges you the privilege of getting them to loan.

How is the money generated?

Your bank can borrow money to create currency.

Suppose you deposit $1,000 in the bank. Then they loaned out 900 dollars. Suddenly, you have $1000, and everyone else has $900. Incredibly, only $1,900 had floated by $1,900 before then.

Now say that your bank lends your $900 to another bank instead. The bank lent another $810 to another bank, and then another $720 to the customer. of! As long as the bank follows your government’s central bank rules, you can immediately receive a reward of $3,430-almost $2500 in pocket money.

The creation of Bitcoin is different from the creation of bank funds, just as cash comes from electronics. It is not controlled by the government’s central bank, but by the consensus of its users and nodes. It was not created by the limited mint in the building, but by distributed open source software and computing. And it needs an actual form of creation. There will be more soon.

Who invented Bitcoin?

The earliest Bitcoin was in 50 blocks (“Genesis Block”) created by Satoshi Nakomoto in January 2009. At first it actually had no value. This is just a cryptographer’s plaything, and it is based on a paper published by Nakomoto two months ago. Nakotmoto is a fictitious name and no one seems to know who he or she is.

Who keeps track of all this?

After the genesis block is created, it works by tracking all transactions of all bitcoins (as a kind of public ledger) to generate bitcoins. Nodes/computers that perform calculations on the ledger will be rewarded for this. For each group of successful calculations, a certain amount of BitCoin (“BTC”) will be rewarded to the node, which will then be regenerated into the BitCoin ecosystem. Hence the term “BitCoin Miner”-because the process creates a new BTC. As the supply of BTC increases and the number of transactions increases, the work required to update the public ledger becomes increasingly difficult and complicated. As a result, the number of new BTCs is designed to be approximately 50 BTC (a block) every 10 minutes worldwide.

Even if the current computing power used to mine Bitcoin (and used to update public ledgers) is increasing exponentially, so is the complexity of the math problem (which, by the way, requires a certain amount of guesswork) or the “proof” required for mining . Bitcoin and settle the transaction book at any given moment. Therefore, the system still generates only one 50 BTC block every 10 minutes, or 2106 blocks every 2 weeks.

Therefore, in a sense, everyone can track it-that is, all nodes in the network can track the history of every Bitcoin.

How many and where?

The maximum number of bitcoins that can be generated is 21 million. According to Khan Academy, this number is expected to peak around 2140.

As of this morning, there are 12.1 million BTC in circulation

Your own Bitcoin is stored in a file (your BitCoin wallet) in your own storage device-computer. The file itself is proof of the amount of BTC you own and can be moved with you on your mobile device.

If the file with the encryption key in your wallet is lost, the bitcoin funds you provided will also be lost. And you can’t get it back.

How much is this worth?

Value varies according to how much people think it is worth-like exchanging “real money”. However, since there is no central agency trying to keep the value near a certain level, it can change dynamically. The first BTC was basically worthless at the time, but those BTC still existed. As of 11 a.m. on December 11, 2013, the public value of each bitcoin is $906.00. When I finished writing this sentence, it was $900.00. Around the beginning of 2013, the value was approximately $20.00 USD. On November 27, 2013, the value of each BTC exceeded $1,000.00. Therefore, it is a bit volatile at the moment, but it is expected to stabilize.

As of the end of this sentence, the total value of all bitcoins was approximately $11 billion.

How can I give me some?

First, you must have a BitCoin wallet. This article provides a link.

Then one way is to buy something from another private party, such as these people on Bloomberg TV. One way is to buy commodities on the exchange, such as Mt. x

Finally, one method is to put a lot of computer power and electricity into the process and become a BitCoin miner. This is far beyond the scope of this article. However, if you still have a few thousand dollars in spare money, you will get quite a lot of equipment.

How should I consume?

From cafes to car dealerships, hundreds of merchants of all sizes are using BitCoin to make payments. There is even a BitCoin ATM in Vancouver, British Columbia that can convert your BTC into cash in Vancouver, British Columbia.

and so?

Money has a long history-thousands of years of history. Some recent legends tell us that Manhattan Island was purchased for Wampum-shells and the like. In the early days of the United States, different banks printed their own currencies. On a recent visit to Salt Spring Island in British Columbia, I spent money only on the lovely island. The common theme among them is the trust agreement between its users, that is, the particular currency has value. Sometimes, the value is directly associated with objects and objects such as gold. In 1900, the United States directly linked its currency to gold (the “gold standard”) and terminated this link in 1971.

Now, currency can be traded like any other commodity, although it can support or reduce the currency value of a particular country through the actions of its central bank. Bitcoin is an alternative currency and can also be traded. Its value, like other commodities, is determined through trade, but it will not be hindered or devalued by any bank’s actions, but by the actions of its users. Direct suppression or devaluation. However, its supply is limited and known, and (unlike tangible currencies) the history of every Bitcoin is the same. Like all other currencies, its perceived value is also based on its utility and trust.

As a currency, BitCoin is not a new thing in Creation, but it is undoubtedly a new method of creating currency.