Bitcoin was created in 2008 by either a person or persons known (most likely pseudonymously) as Satoshi Nakamoto. It is an open sourced software peer to peer decentralized digital currency. Although cryptography has been around for ages Bitcoin has the potential to revolutionize the monetary system and the world of finance.
In early 2010, Bitcoin was a novelty and there is an account of someone paying $10,000 BTC for 2 Papa Johns pizzas.
By 2011 the price would fluctuate from .30 to $30.
2013 saw prices from $13 to $770 by years end.
In 2017, Bitcoin experienced tremendous growth once again going from $900 to $20,000.
After having endured at least 2 major corrections to as low as $3,000, Bitcoin has remained around $10,000 as of late 2020.
One of the main advantages of Bitcoin is that it is a deflationary currency, unlike fiat currency that may be created endlessly. Meaning there will only ever be 21 million bitcoin. Bitcoin has been generated at a decreasing rate since its inception as the chart shows.
This means there are only around 2,500,000 BTC left to be mined.
Make sure to pin this post for later!
This article contains affiliate links. You can read more about this here.
How does bitcoin work?
Miners work to confirm transactions on the blockchain and receive Bitcoin as a reward.
You can send and receive Bitcoin with a QR code or an address and the transaction will be confirmed by the network and then be available.
Bitcoin has the characteristics of money:
It is based on the properties of mathematics, rather than relying on physical properties (like gold and silver) or trust in central authorities (like fiat currencies).
Today large companies such as Greyscale and MicroStrategy Industries have bought large holdings of Bitcoin. There are countless exchanges and platforms to buy crypto from.
Coinbase is a centralized platform that is very popular and a relatively simple way to buy Bitcoin and a variety of other crypto currencies. Use this link to get free bitcoin when you buy crypto on Coinbase.
There are many decentralized exchanges as well known as DEX’s. The DEX exchanges generally use a wallet such as Metamask to link to the exchange. They also tend to focus on Ethereum and many of the Ethereum based tokens.
For beginners the easiest thing to do is to purchase crypto from a centralized exchange as it easily connects to your bank account. There are also Bitcoin ATM’s throughout the USA and in other countries as well.
Where to store your bitcoin?
If you have acquired as significant amount of crypto, security is critically important as exchanges have been hacked and gone defunct.
There are many wallet options for storing your crypto. Electrum provides a relatively secure desktop wallet.
Keep track of your seed. This is a 12 word list that can be used to restore your wallet. If you lose track of your wallet and the seed there is no central authority to assist in recovering your funds.
There is also a cold storage option where Bitcoin is stored on an external device such as a trezor. These save your wallet on the device and can be connected to the network to spend bitcoin.
Ethereum is a more recently developed cryptocurrency that has different properties than bitcoin. Its supply is not capped and it is more focused on powering applications known as dapps. These have potential uses in gaming as well as many other uses for automating contracts known as smart contracts.
A smart contract is a computer protocol intended to digitally facilitate, verify, or enforce the negotiation or performance of a contract. Smart contracts allow the performance of credible transactions without third parties.
This has led to an array of different projects from tokens that allow for vpn use to the recently popular DeFi movement. DeFi is allowing for earning interest on deposits in crypto and also using it as collateral to borrow. The AAVE platform is an example of a DeFi project. There are many others.
Should you invest in crypto?
Beware of the risk involved in cryptocurrencies. Bitcoin itself is very volatile. The thousands of projects that have come after it present an even greater risk of volatility than Bitcoin.
If you wish to take the risk though jump in and you will see that the possibilities are endless. With a little research you will see that Bitcoin as well as the blockchain technology surrounding it is just beginning to realize its potential.
On this site we will provide a variety of different tutorials that will assist in demonstrating the different platforms and use cases for Bitcoin as well as other cryptocurrencies. Thank you for visiting and enjoy.