Bitcoin, what it is, how it works and where to buy Bitcoins

We have been hearing about Bitcoins for several years, not only in the news, but also on television series. The problem is that in most occasions, especially in television series, What Bitcoins really are and what we can do with them is distorted. Bitcoin it is a virtual currency It is not controlled by any authorized body, it is not stored in banks, it is untraceable and on many occasions, especially in its early days, it has been associated with illegal activities related to the sale of drugs and weapons (Silk Road will sound familiar to all of us) . But if we dig a little deeper into what this new coin really is, we can see that it could become, in the not too distant future, a coin widely used by users.

In addition, Bitcoin has suffered a spectacular increase in its price, which is why it has become a great investment opportunity for those who want to get a significant return on their money. € 5.000, € 10.000, € 200.000,… there are even professionals in the sector who predict a future where Bitcoin can be worth a million euros. Faced with such claims, many people are entering the Bitcoin market as investors.

What is Bitcoin?

As I have commented above, Bitcoin is a digital currency, it does not have notes or physical coins with which to carry out transactions. Bitcoins are stored in virtual wallets from which we can make instant payments over the internet. Leaving aside the usual use with which it had been related, currently Microsoft, the Steam gaming platform, Las Vegas casinos and even NBA basketball teams accept this digital currency as a form of payment, but they are not the only ones since the number of businesses and large companies that are beginning to favor the use of this currency is increasing.

In short we could say that Bitcoin is a fully digital, decentralized and user-driven currency. Due to the lack of knowledge about this new currency, not controlled by any financial organization, some countries have begun to block websites that allow operations with this currency, such as Russia, Vietnam, Indonesia. However, other countries such as the United States and Brazil already offer ATMs where we can buy Bitcoins directly by associating them with our wallet.

There are other cryptocurrencies such as Ether, Litecoin and Ripple but the truth is that Bitcoin is today the only cryptocurrency with importance and weight worldwide.

Who created the Bitcoin?

Although there is no real proof as to who its creator was, most tracks credit Satoshi Nakamoto in 2009, although the first ideas to create a decentralized and anonymous currency were found in 1998, on a mailing list created by Wei Dai. Satishi conducted the first tests of the operation of a Bitcoin concept on a mailing list at his university, although shortly after he left the project, leaving a sea of ​​doubts and causing a lack of understanding about the open source on which Bitcoin is based and the real utility.

In 2016, the Australian Craig Wright, claimed he was the creator of digital currency alongside Dave Kleiman (passed away 2013) stating that Satoshi Nakamoto's name was false and had been created by both of them to hide anonymously. Craig presented a series of private keys associated with the first coins created by Nakamoto, but it seems that the information he revealed to prove that he was the creator was not enough and for now the name of the creator of the Bitcoins is still in the air.

How much is a Bitcoin worth?

In the last year, the price of Bitcoin has skyrocketed 500%, and at the time of writing this article, the price of Bitcoin is at roughly $ 2.300. Despite the boom that the currency has been having in recent years, many are still skeptical when it comes to investing in this digital currency, cataloging it as a bubble effect that sooner or later will burst, taking the money of all the users who have invested time and money in this currency.

One point in its favor is that does not depend on any body that regulates it and can control it, so that only users and miners, along with the number of operations carried out on a day-to-day basis, can influence the rise or fall of their price. The different applications or web pages that allow us to buy and sell Bitcoins offer us the quote at the exact moment we want to carry out the transaction so that we know at all times the number of Bitcoins that we are going to obtain. If you want to buy Bitcoins, our recommendation is that you use a robust and secure platform like Coinbase. Click here to open an account with Coinbase and buy your first Bitcoins.

 Where can I buy Bitcoins?

Although the value of Bitcoins can vary quite a bit over a year, more and more users who are interested in investing in this cryptocurrency. Currently on the internet we can find a large number of web pages that allow us to invest in Bitcoins. But of all that we can find, many of them just want to keep our money without offering anything in return, we highlight Coinbase, one of the first to bet on this non-centralized and anonymous currency almost from the beginning.

To buy Bitcoins through Coinbase we must download the respective applications for each operating system: iOS or Android. Once we register and complete a few simple verification steps, we fill in our bank account information and we can start buying Bitcoins, Bitcoins that will be stored in the wallet that this service offers us, from which we can make payments to other users in this coin or simply store them until their market price is higher than the current one.

In the same application we can quickly get the value of Bitcoin at the time of buying or selling, so that we will not have the need to consult other web pages before carrying out the process. As a general rule, the value of Bitcoin is shown in dollars, so it is advisable to buy this currency in dollars and not in euros, otherwise we want to lose money with the changes made by the bank to carry out the transaction.

How to mine Bitcoins

In order to start putting your head into the world of Bitcoins you need first of all internet connection, a powerful computer and specific software. In the market we can find different forks of the open source application used to earn Bitcoins, it all depends on which one best suits your needs. The process to mine Bitcoins is simple, since your team is in charge, along with thousands of other computers, to process the transactions that take place in the market and in return collect Bitcoins. Obviously the more teams you have working, the more Bitcoins you can get, although not everything is as beautiful as it looks.

When there is more competition, the chances that your team will be used to make a transaction decrease, hence the rate of profit is reduced. Nobody can control the system to increase the income of Bitcoins, the only thing that can be done is to create farms that have a large number of computers connected to the network, which in turn it entails a significant cost of light, not counting the cost of the equipment, which must be quite powerful.

The speed at which they are created is reduced as Bitcoins are issued, until the figure of 21 million is reached, at which time no more electronic currencies of this type can be generated. But to reach that amount there is still a long time to go.

Another option to mine bitcoins in a much easier way is to rent a system of Bitcoins cloud mining.

Who controls Bitcoins?

The problem that Bitcoins represent for countries and large banks is that there is no institution that is in charge of controlling everything related to this currency, something that obviously does not make them funny, especially for a time in this part where Bitcoin is starting to become a common currency, although there are still many years to go before it is a real alternative.

Coinbase, Blockchain.info and BitStamp are in charge of offering the Bitcoin infrastructure, are nodes that work for profit, so they always move for their own interest, whoever offers them the most money, but they are not the ones who put them into circulation, that task falls on the miners, people who thanks to software specific and the power of your computer / s can be mining and earning Bitcoins.

Advantages of Bitcoins

• SecuritySince users have complete control over all their transactions, no one can charge an account like credit cards or checking accounts can.
• Transparent. All information related to Bitcoins is publicly available through blockchains, a registry where all the information related to this currency is available, a registry that cannot be modified or manipulated.
• Commissions nonexistent. Banks live off the commissions they charge us in addition to playing with our money. The payments we make with Bitcoins, in most cases are completely free since there is no intermediary to make it, although sometimes, depending on the type of service we want to pay, some commission may be applied, but in very specific cases .
• Speed. Thanks to Bitcoins we can send and receive money practically instantly from or anywhere in the world.

Disadvantages of Bitcoins

Obviously not only the world, and less the financial organizations, are in favor of the popularization of this currency, mainly because it does not have any way to reach out and control it.

• Stability. Since its birth, Bitcoins have reached figures that exceed a thousand dollars per unit, and days later they have a value of a few hundred dollars. It all depends on the operations and volume of Bitcoins that are moving at that moment.
• Popularity. Surely if you ask someone known for bitcoins and who is not much into technology, they will tell you if you are talking about an energy drink or something similar. Although more and more businesses and large companies are beginning to support this currency, there is still a long way to go before it can become a common day-to-day currency.