Buzz
Bitcoin is created by individuals and businesses investing in Bitcoin using computer algorithms to solve mathematical formulas.
Bitcoin serves as the first prime example of a developing form of currency known as cryptocurrency.
What sets bitcoin apart from other conventional currencies?
People can use bitcoin to purchase electronic goods, making it similar to USD, Euro, or Yen, as it is also digitally traded.
What is bitcoin? Can you earn bitcoin on your own?
The most crucial nature of bitcoin, setting it apart from conventional currencies, is its decentralized essence. No organization controls the bitcoin network, providing a sense of comfort for some individuals as their funds remain beyond the control of large banks.
Who created bitcoin?
Software developer Satoshi Nakamoto proposed bitcoin, an electronic payment system based on mathematical proof. The idea was to create an independent currency, transferring electronically instantly, with low transaction fees.
Who prints bitcoin?
No one. This currency unit isn't printed in secrecy within central banks and issued like other paper currencies because they can't establish their own rules. These banks can only create more money to cover national debts, causing their currency to depreciate.
Instead, bitcoin is digitally created by a community that anyone can join. Bitcoin is 'mined' by harnessing computational power in a decentralized network.
This network also processes transactions made with digital currency efficiently, in contrast to bitcoin's separate payment network.
What is Bitcoin? Can you earn Bitcoin on your own?
So you can't generate an unlimited amount of bitcoin?
Absolutely correct. The bitcoin protocols – the rules bitcoin operates on – state that only 21 million bitcoins can be created by miners. However, this amount can be divided into smaller units (the smallest unit being one hundred millionth of a bitcoin, known as Satoshi, the creator of bitcoin).
What does Bitcoin rely on?
Traditional currencies rely on gold or silver. In theory, you could exchange a USD at a bank for gold (although this is not practiced in reality), but bitcoin is different; it doesn't rely on gold but on mathematics.
Across the globe, people are utilizing software programs following a mathematical formula to produce bitcoin. The mathematical formula is available for anyone to verify.
This software is also open source, meaning anyone can be certain about what it's doing.
What are the characteristics of bitcoin?
Bitcoin has several crucial features that set it apart from government-backed currencies.
1. Bitcoin is decentralized
The bitcoin network isn't controlled by authoritative bodies. Each bitcoin miner and transaction processor plays a part in the bitcoin network, working collaboratively.
In simple terms, in theory, an authoritative body can't whimsically enact monetary policies or simply decide to confiscate people's bitcoins, similar to what the Central European Bank did in Cyprus in early 2013.
And if, for some reason, a portion of the bitcoin network becomes inactive, the funds still keep flowing.
Tips: If you're interested in learning how to earn Bitcoin, you can check out the guide here for more details.
- Explore More: How to earn Bitcoin for free daily
2. Easy to set up
Typically, opening a bank account takes a considerable amount of time. Setting up seller accounts for payments, on the other hand, is a Kafkaesque task, restrained by a bureaucratic system.
However, you can establish a bitcoin address in just a few seconds, without the need for questions, and with no fees.
3. Bitcoin is “anonymous”
Users can possess multiple bitcoin addresses, and these addresses are not tied to names, addresses, or other personal identifying information.
4. Bitcoin is entirely transparent
Bitcoin records the details of every transaction that has ever occurred in the vast network known as the blockchain.
If you publicly share a Bitcoin address, anyone can know how much bitcoin is at that address; they just don't know it's yours.
Some individuals may make their activities less transparent when using bitcoin by not consistently using a bitcoin address and not transferring a significant amount of bitcoin to a single address.
5. Transaction fees are very low
Your bank may charge a £10 international transfer fee, but not with bitcoin.
6. Swift Payments
You can send money anywhere, and that amount will be transferred within a few minutes, as soon as the bitcoin network processes the payment.
7. One-way Street
Once your bitcoin is sent, it won't come back unless the recipient returns it to you. Otherwise, the bitcoin will disappear forever.
You can also check how to sell Bitcoin, trade bitcoin here to avoid fraud and asset misappropriation.
- Explore More: How to sell Bitcoin
Here, Mytour has just introduced to you What is Bitcoin? Can you earn Bitcoin on your own?. These are the basic knowledge, first before engaging in bitcoin mining, earning bitcoin.
Additionally, readers can follow and anticipate the next articles from Mytour to delve deeper into how bitcoin operates in reality. Learn how bitcoin is mined, what happens during a bitcoin transaction, and how the network system tracks everything.
