The guy
Login Register
Write for us Advertise here Our PGP Contact us

What is Bitcoin?

By Alex Nimoy Oct. 12, 2019, 9:37 a.m.
btc.jpg

What is Bitcoin?

In a nutshell, Bitcoin offers a fairer financial system where everyone is equal.
At the tap of a button, you can move any amount of money, anywhere in the world—instantly, securely, and typically for micro fees. Let’s explore how it all works:

Money that you control
Bitcoin is a new type of digital money and, just like with all money, you can store it, exchange it, and make payments with it.
However, unlike with traditional (fiat) currencies where payments are controlled by central banks, Bitcoin puts you in full control of your own money.
This means you can send, receive, and store any amount of money without relying on financial intermediaries, making bank fees, identity fraud, and delays a thing of the past.
Bitcoin’s key features:

    • Decentralized: nobody controls or ‘owns’ the Bitcoin network, and transactions can never be altered or censored.

    • Peer-to-peer: secure payments go directly from one person or business to another, so there’s no need for any ‘trusted third party’ to process payments.

    • Fixed supply: only 21 million coins will ever be created, making Bitcoin much more immune to the inflation traditional currencies are prone to.

    • Low fees: it’s typically much cheaper to move money through Bitcoin’s peer-to-peer network, and transactions are also very fast.

    • Global digital ledger: all Bitcoin transactions are recorded on a global public ledger called the blockchain, and anyone can view them.

Why are there different ‘types’ of Bitcoin?
At Bitcoin.com, we often use the word ‘Bitcoin’ to refer to both Bitcoin Cash (BCH) and Bitcoin Core (BTC) collectively. Here’s a quick explanation of why the two different digital currencies exist:

Open to all

Bitcoin is open-source software. This means anybody can propose changes to improve the Bitcoin network and, if these changes are supported by everyone upholding the network, an upgrade takes place.
If the proposed changes are not supported by the whole community, an entirely new digital currency may be created from the original coin (called a ‘hard fork’) instead. This is precisely what happened with Bitcoin.

Bitcoin Core (BTC)

By original design, Bitcoin was built to be an electronic cash system. In other words, it was designed to be used for both big and small global payments—day in, day out.
However, when the original digital currency, which is now commonly called Bitcoin Core (BTC), became more popular in 2017, it struggled to meet the demands of a global currency.
Transactions were slow, expensive, and sometimes unreliable as the network became ever-busier, so part of the Bitcoin community decided a change was needed.

Bitcoin Cash (BCH)

To resolve the problem, they suggested that the network should undergo a change which would make it faster, cheaper, and more reliable.
In technical terms, this involved increasing the block size to 8MB; in simple terms, this means the number of transactions which can be processed at once increased!
However, part of the community rejected the change, leading to a hard fork taking place on August 1st, 2017. During this fork, a new type of Bitcoin called Bitcoin Cash (BCH) was created.
Today, Bitcoin Cash (BCH) can meet the demands of a global currency, which is why we support it here at Bitcoin.com. However, you’re always free to use any digital currency you choose to!

How can I keep my Bitcoin more secure?

Storage

• Using third-party wallets where they control the access to your coins (e.g. your account on a cryptocurrency exchange) is
not a secure way to store your coins because places like exchanges are targeted by hackers.

• Instead, store your coins in a wallet that only you have access to (referred to as non-custodial). This puts the control in your hands, not someone else's.

• Consider a hardware wallet if you’d prefer a physically safe place to store your coins. Since they’re not connected to the internet, they can offer greater security.

Backups

• When you set up a wallet to send and receive Bitcoin, you’ll be prompted to back it up.

• Your backup lets you regain access to the Bitcoin you own in the event that the device holding your wallet is lost, stolen, or breaks.

• This simply involves recording a unique series of words called a recovery seed. Rather than recording this on paper, we recommend a more durable material such as metal.
Best practice

• Never share your wallet recovery seed or passwords to your cryptocurrency exchange with anyone as these could be used to steal your coins.

• When using a cryptocurrency exchange, choose a unique password that you change regularly and always make use of two-factor authentication for added security.

• Ignore any unexpected emails from cryptocurrency exchanges or trading platforms as these could be a phishing scam. Instead, visit the site directly in your browser.

How do I easily buy and sell Bitcoin?

Buying Bitcoin

You can buy Bitcoin with fiat currencies, such as USD, and also with other cryptocurrencies.
From website

1. Visit official Buy Bitcoin page.

2. Select whether you want to buy Bitcoin Cash (BCH) or Bitcoin Core (BTC).

3. Choose whether you want to buy in USD or EUR, and enter the amount.

4. Carefully review then add your wallet address and click Continue.

5. Complete the purchase process by creating an account with Simplex,  trusted seller.

From wallet (UK and Europe only)

 1. Open the Bitcoin.com wallet app on your device.

2. In the Wallets section, select Buy Bitcoin Cash.

3. Follow on-screen instructions and provide the required personal details.

4. Once complete, you can purchase up to €150 of Bitcoin Cash (BCH) every month.

5. To buy more, select Increase Purchase Limit and verify your identity.

From peer-to-peer trading platform (BCH only)

1. Visit Local.Bitcoin.com and create an account.

2. Find an existing seller looking to sell Bitcoin Cash (BCH) or create a new buy order yourself.

3. Open a trade with your chosen seller and they’ll send the BCH to the blind escrow account.

4. Once you’ve sent the agreed payment via bank transfer or other payment method, the seller will confirm they’ve received the funds.

5. The BCH you’ve bought will then be released from the blind escrow and sent to your digital wallet.

From a cryptocurrency exchange

1. Visit a cryptocurrency exchange.

2. Create an account and verify your identity as required.

3. Follow the website’s instructions to buy your Bitcoin Cash (BCH) or Bitcoin Core (BTC).

4. Your coins will appear in the exchange's wallet connected to your exchange account.

5. Finally, move your Bitcoin to your personal wallet to keep it more secure.

Selling Bitcoin

The Bitcoin in your wallet can be sold for other cryptocurrencies, such as XRP, or for traditional fiat currencies, such as USD.
On peer-to-peer trading platform (BCH only)

1. Visit Local.Bitcoin.com and create an account.

2. Find an existing buyer looking to purchase Bitcoin Cash (BCH) or create a new sell order yourself.

3. Open a trade with your chosen buyer and send your BCH to the blind escrow account.

4. Once the buyer has sent your payment via bank transfer or other payment method, confirm you’ve received the funds.

5. The BCH you’ve sold will then be released from the blind escrow and sent to the buyer’s digital wallet.

On a cryptocurrency exchange

1. Visit a cryptocurrency exchange.

2. Create an account and verify your identity as required.

3. Follow the website’s instructions to sell your Bitcoin Cash (BCH) or Bitcoin Core (BTC).

4. If you sold it for fiat money, you can cash out the funds into your bank account.

5. If you sold it for another cryptocurrency, you can send the coins to your personal wallet (make sure your wallet accepts those coins before sending).

How do I send and receive Bitcoin?

Receiving Bitcoin

1. Open your Bitcoin.com wallet app and select Receive.

2. Choose which wallet you want to receive Bitcoin to. Make sure you select a BCH wallet if you are receiving Bitcoin Cash or a BTC wallet if you are receiving Bitcoin Core.

3. Your chosen wallet will generate an address that lets you receive coins. Copy this by tapping the QR code if you’re on mobile, or by clicking it if you’re on desktop.

4. Provide this address to the cryptocurrency exchange or person sending you Bitcoin.

5. Or, if you’re in person, the sender can simply scan your wallet QR code with their device.

Sending Bitcoin

1. Open your Bitcoin.com wallet app and select Send.

2. Copy and paste the recipient’s wallet address into your own wallet app. Or, if you’re in person, select Scan QR code and simply scan it with your app.

3. Choose which wallet you want to send Bitcoin from. Make sure you select a BCH wallet if you want to send Bitcoin Cash or a BTC wallet if you want to send Bitcoin Core.

4. Enter how much you want to send and select Next.

5. Carefully check that you’re happy with the details and then Slide to send.

6. Or, if you’re wanting to move money between your own wallets, select Transfer between wallets in the Send section of your app.

Where do I store my Bitcoin?

Welcome to digital wallets

    • When you buy, earn, or send Bitcoin Cash (BCH) or Bitcoin Core (BTC), the coins will appear in your digital wallet (aka Bitcoin wallet).

    • This wallet is typically an app that you download to your phone or desktop, but there are other variations, such as web wallets and hardware wallets.

    • Depending on how much Bitcoin you own and how often you want to access it, different types of wallets will be better suited to you.

Software wallets: Convenient storage

    • For frequent Bitcoin trading, software wallets are ideal.

    • These take the form of an app which is downloaded for free to your phone or desktop. You simply open up the app and can make Bitcoin transactions in an instant.

    • Since software wallets are connected to the internet, it’s important to make sure your device is well secured to prevent online theft.

    • We only recommend storing a limited amount of your coins in a software wallet for regular trading and spending.

Tip: Make sure the software wallet you’re using is fully non-custodial. This means only you can access your coins—not the wallet provider.

Hardware wallets: Long-term storage

    • If you own a significant amount of Bitcoin, the best storage option is a hardware wallet (often called a cold wallet).

    • These are physical devices created specifically for the purpose of storing cryptocurrencies, and they offer the best security for your digital assets.

    • This is because hardware wallets are not connected to the internet, making them invulnerable to online hacking.

    • Since they take more time to access, hardware wallets aren’t ideal for making frequent Bitcoin transactions: use them for long-term storage instead.

Tip: Hardware wallets are well worth the money—especially if you own a lot of Bitcoin. To make sure the device is legitimate, only buy one from a company you can trust (like us!).

What about storing coins on an exchange?

    • Cryptocurrency exchanges are a popular place for many newcomers to buy their first Bitcoin because they make the buying process very simple.

    • However, the cryptocurrency exchange itself has control over the funds in your account (web wallet), making them far more prone to theft and fraud.

    • As such, we recommend using cryptocurrency exchanges only for trading—not for storing your Bitcoin.

Tip: Cryptocurrency exchanges are not a secure place to store your coins. Once you’ve bought your Bitcoin, move it to your software or hardware wallet as soon as possible.

0 Comments

Please visit our onion version to comment.