Everything you need to know about Bitcoin

In the last few decades, there has been a lot of awareness regarding the significance of financial investments. We had heard a lot about shares and stock. But, there has been a discussion about a new kind of investment, which is Bitcoin. I’m sure that you have heard something about bitcoin before. Thus, we are going to talk about everything you need to know about Bitcoin.

What is Bitcoin?

Bitcoin is the virtual currency, it is designed to have as much significance as the currency that we usually use, Dollars or Dinar etc. However, it is a lot more powerful than our local currencies. Reason being that it is not controlled by the government, people or any other organization. It is a cryptocurrency (Cryptocurrency is the digital currency, secured by cryptography). Bitcoin was launched in 2009 by an anonymous group of developers called Satoshi Nakamoto.

Bitcoin is considered to be one of the most lucrative long term investments. It is very valuable. As if today, one bitcoin is being sold for 22,206 USD. 

Since the launch of Bitcoin, cryptocurrencies have experienced a huge increase in the investment and people’s trust. It has led to development of many other cryptocurrencies such as Ethernet. But it has also worried many organizations, governments are not being able to track the finances and banks are worried that they may become irrelevant in the new future. 

You may ask if Bitcoin is not controlled by anyone, How does it function? Who is the verifier of financial traction, if there is no third involvement such as banks? 

This is where Bitcoin Mining comes into the game. 

What is Bitcoin Mining?

Bitcoin Mining is something that is worrying all these organizations and banks etc. Bitcoin mining involves confirmation of the transactions and also adds the bitcoins into the system. It works by using a specific hardware that is used for mining purposes. In return, the Bitcoin miners get a little fee from the users for confirming bitcoin transactions etc. that’s what the profit is for the miners. 

As stated earlier, Bitcoin is mined with advanced computer hardware, which is capable of solving complex mathematical problems. The first hardware to solve the problem receives the next block of bitcoin to solve, this goes on continuously day & night, making bitcoin miners money. The ability of earnings depends on the capabilities of the hardware, how complex and how quickly can it find the solution to the problem.

The fact that anyone can become a Bitcoin Miner as long as they have the investment, which is what makes it unique. It involves a decentralized financial environment, which means that no organization or person (including Bitboin Miner) has access to your Bitcoin and can’t track it. However, it comes with its pros and cons. 

The fact is governments are not being able to track the finance. It is quite easy for the criminal and money launderers to move money without anyone being able to track them. There has been plenty of evidence confirming the fact the criminals have already started using Bitcoin and other cryptocurrencies to move their black money.

What is a Bitcoin Wallet?

Bitcoin Wallet is just like a normal wallet, but it holds the cryptocurrency instead of the cash. It does not have a card or cash. It’s only an application that functions as a wallet. Bitcoin wallet also provides you with service to buy or sell bitcoin, making it easier for everyone to invest in bitcoins.

You don’t have to pay for the Bitcoin wallet. It’s totally free. It’s as simple as going to an application and signing up without going to any office etc. First bitcoin wallet was made by the developer of Bitcoin Satoshi Nakamoto. Nowadays, we have many cryptocurrency wallets such as: 

• coinbase wallet
• Exodus wallet
• Electrum wallet
• And many more.

Pros and Cons of Bitcoin

There are many pros and cons of Bitcoin. We are going to discuss some of the most important ones today:

Pros:

• Governments or big mafias can’t manipulate or control the flow of money. This could be considered as a con. However, time and time again the banks and big mafias have shown how they control the flow of money, middle class or poor people pay the price.
• Accessibility, Anyone can buy Bitcoin from anywhere and convert it to any currency they want.
• Extremely lucrative investment, there was a time when 1 bitcoin was not even worth $ 1 and today it is worth $22,000. It is a very lucrative investment for investors. 

Cons:

• The fact that Governments cannot regulate it. Government could ban it in the coming years just like the Chinese government has already banned it.
• Not sustainable, there is evidence of bitcoin increasing over a long period of time. However, in the short term it isn’t sustainable as it is today. For instance, today bitcoin could be $22,000  and tomorrow it could go to $20,000 overnight. This is what makes it unsuitable. 
• Every time you transfer the bitcoin to a bitcoin regardless of the fact where they live, it costs you a fee. Which might not be affordable for everyone.