Coins And Currency for Dummies
Key pointsBitcoin is a digital currency known as a cryptocurrencyThe peer-to-peer technology underpinning it is known as the blockchain a public ledger of all transactionsBitcoins can be stored in a virtual wallet and used to Purchase other currencies or real world goods
Where once a single bitcoin was worth a few cents it is now worth about $9,200 per coin (November 2017), creating millionaires in the process.There have been many reported instances where people mined thousands of comparatively worthless bitcoins as a hobby years ago, only to now realise they're rich.One IT employee even threw out a hard disk containing 7,500 bitcoins.
This is done with no central authority or bank.Who generated itBitcoin and also the blockchain technology was made by someone under the pseudonym of Satoshi Nakamoto and published as a working beta in 2009. Satoshi's true identity remains a puzzle as he disappeared from the scene in 2010 after seemingly handing over the reins to Gavin Andresen, the chief scientist in the Bitcoin Foundation.Over years numerous individuals have promised to be Satoshi, including Australian computer scientist Craig Wright.
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If the web site gets hacked or someone gets your login details that they could get and drain your funds from the exchange.There is no way for a transaction to be revoked or revoked if a burglar sends your bitcoins for their wallet.After buying your coins you should transfer them into a secure digital wallet created by you and not hosted online.You can even write down the pocket's personal key on a piece of paper (that is known as a paper wallet) and stick it in a safe.If you don't save the private key on your computer or online then recipients can never break in and access your funds.
Bitcoin means different things to different individuals. For many, it is a future of freely moving currency untied to any central bank. To the others, it is a purely electronic entity of questionable value and doubtful origin. But what is Bitcoin, in the most elementary senseIn most casual conversations, you can get away with knowing that bitcoin is, basically, an electronic currency.
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In reality, it is two much more complex things.Bitcoin has been with us since 2009, when a person (or group) under the pseudonym Satoshi Nakamoto introduced a stage (Bitcoin, uppercase) that hosts a digital currency (bitcoin, lowercase). Bitcoin the stage is built on the concept of proof of work data which is expensive and time-intensive to create but can be easily verified.
To mine a bitcoin, a computer must complete a complicated algorithm, essentially going through the job of an extensive calculation in exchange for a few newly minted currency. That bit of electronic currency is worth whatever the market determines through supply and demand.Transactions are connected to a users Bitcoin address, which is saved on its general ledger, called the blockchain.