What is bitcoin?
If you’re here, you’ve heard of bitcoin. It has been one of the most frequent headlines in the last year or so – as a scheme to get rich quick, the end of finances, the birth of a truly international currency, the end of the world or a technology that has improved the world. But what is bitcoin?
In short, it can be said that bitcoin is the first decentralized money system used for online transactions, but it will probably be useful to dig a little deeper.
We all know, in general, what “money” is and what it is used for. The most important problem that witnessed the use of money before bitcoin is related to its centralization and control by one entity – the centralized banking system. Bitcoin was invented in 2008/2009 by an unknown creator, nicknamed “Satoshi Nakamoto”, to lead to the decentralization of money globally. The idea is that the currency can be traded internationally without difficulty or fees, checks and balances will be distributed around the globe (and not just in the books of private corporations or governments) and money will become more democratic and equally accessible to all.
How did Bitcoin start?
The concept of bitcoin and cryptocurrency in general was developed in 2009 by Satoshi, an unknown researcher. The reason for its invention was to solve the problem of centralization in the use of money that relied on banks and computers, a problem that many computer scientists were not happy with. Achieving decentralization has been unsuccessful since the late 1990s, so when Satoshi published a document in 2008 proposing a solution, he was highly welcomed. Today, bitcoin has become a well-known currency for Internet users and has spawned thousands of “altcoins” (non-bitcoin cryptocurrencies).
How to make bitcoin?
Bitcoin is made through a process called digging. Just as paper money is made by printing and gold is extracted from the earth, bitcoin is created by “digging”. Digging involves solving complex mathematical problems about blocks with the help of computers and adding them to a public book. When I started, a simple CPU (like the one in your home computer) was all you had to dig, but the level of difficulty has increased significantly and you will now need specialized hardware, including a high-end graphics processor (GPU), to extract bitcoin.
How to invest?
First, you need to open an account with a trading platform and create a portfolio; You can find some examples by searching Google for a “bitcoin trading platform” – they usually have names that include “coin” or “market”. Once you join one of these platforms, click on the assets and then click on crypto to select the currencies you want. There are many indicators on each platform that are quite important and you need to make sure you follow them before investing.
Just buy and hold
Although mining is the safest and, in a sense, the easiest way to earn bitcoin, there is too much noise, and the cost of electricity and specialized computer hardware makes it inaccessible to most of us. To avoid all this, make it easy for yourself, enter the amount you want from your bank directly and click “buy”, then sit back and watch your investment increase as the price changes. This is called an exchange and takes place on many exchange platforms available today, with the ability to trade between many different fiat currencies (USD, AUD, GBP, etc.) and different crypto coins (Bitcoin, Ethereum, Litecoin, etc.). .).
Bitcoin trading
If you are familiar with stocks, bonds or forex exchanges, then you will easily understand crypto trading. There are bitcoin brokers such as e-social trading, FXTM markets.com and many more to choose from. The platforms provide you with bitcoin-fiat or fiat-bitcoin currency pairs, for example BTC-USD means bitcoin trading for US dollars. Follow the price changes to find the perfect pair according to the price changes; platforms provide price among other indicators to give you the right trading tips.
Bitcoin as stocks
There are also organizations set up to allow you to buy shares in companies that invest in bitcoin – these companies trade back and forth, and you just invest in them and wait for your monthly benefits. These companies simply pool digital money from different investors and invest on their behalf.
Why should you invest in bitcoin?
As you can see, investing in bitcoin requires you to have some basic knowledge of the currency, as explained above. As with all investments, this involves risk! The question of whether or not to invest depends entirely on the individual. However, if I have to give advice, I would advise investing in bitcoin for the reason that bitcoin continues to grow – although there has been a significant period of boom and bust, it is very likely that cryptocurrencies in general will continue to rise in value during the next 10 years. Bitcoin is the largest and most famous of all current cryptocurrencies, so it is a good place to start and the safest bet right now. Although it is variable in the short term, I suspect you will find that bitcoin trading is more profitable than most other ventures.