In the 2020s, it seems like everyone is talking about Bitcoin. There is no shortage of opinions on Bitcoin and its consequences. Businesses, social justice activists, politicians, and inventors all have their own perspectives on it.
All of this hype can make it hard to understand just what Bitcoin is how it works. No matter what sort of life you live, learning about Bitcoin will help you better understand our present. It will also help you prepare for the future, and maybe even make some smart investment opportunities along the way.
This article will serve as your Bitcoin guide and walk you through a few basics of cryptocurrency.
Why Does Bitcoin Exist?
Before investing in crypto, it’s important to understand why Bitcoin — and therefore Cryptocurrency — exists in the first place. In 2009, an anonymous entity known as Satoshi Nakamoto introduced Bitcoin, the first cryptocurrency, into the world, along with a whitepaper that explained why it existed.
The purpose of Bitcoin is to create a completely peer-to-peer currency, one that wouldn’t need government regulation to exist. A digital currency wouldn’t need to be physically produced, so mints wouldn’t have to be a factor.
To combat counterfeiting, this anonymous entity also created Blockchain.
If you’re interested in bitcoin or any other cryptocurrency, you’ve probably heard the term blockchain thrown around. Understanding blockchain is key to understanding bitcoin. But what exactly is it?
At the end of the day, blockchain is just a system developed by Satoshi Nakamoto to make sure that bitcoin stayed secure without government regulation. Each interaction making use of bitcoin — rather than the coin itself — is considered a “block” and given a “hash”, a sort of hyper-complex serial number that’s hidden by a cryptogram.
Freelancers solve these cryptograms to determine the accuracy of each interaction. This allows them to add that “block” into the “chain”, a process known as bitcoin mining.
Understand Bitcoin Investing
Bitcoin investing is a complicated world because not that many companies make use of Bitcoin yet. Investing in Bitcoin is akin to betting on the future of Bitcoin.
One Bitcoin is currently worth around 60,000 dollars — so we’re not talking about an easy translation here. You’ll likely be buying a fraction of Bitcoin — or any other cryptocurrency.
Unfortunately, this is too small of a platform to describe the whole world of Bitcoin investing. Do you want more information on the subject of investing in smaller amounts of bitcoin? If so, check out this article by Bytefederal on Bitcoin Units.
Learning About Bitcoin is Important
As you can see, Bitcoin isn’t as complicated as many people make it out to be. Learning about Bitcoin can be as simple as understanding what the main terms around it actually mean.
Once you understand why Bitcoin exists, how blockchain works, and where you should go in Bitcoin investing, you’re far more likely to succeed.
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