Well, Nowadays there is a buzz word everywhere named Bitcoin. After hearing this magical word many questions arrives in mind like what is Bitcoin, who invented this, How it works, Is it legal, How to mine or buy it, like a ton. In this article, I am going to clear all your queries briefly and clearly one by one. Let’s explore.
What is Bitcoin
Bitcoin is a Cryptocurrency or you can say digital currency. It was invented in 2009 and the first ever Cryptocurrency. It is also the first decentralized digital currency. No one knows who actually invented Bitcoin. Cryptocurrencies are designed in such a way that it acquires maximum security and anonymity. It was One of the biggest mysteries in the technology world of the 21st century.
But it is assumed that Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto. In periods of time, several people claimed that he is the real Satoshi Nakamoto. But no one proves it.
Anonymity provides more privacy, more protection, and more peace—three things that likely plea to the owner of Bitcoins. The search for real Satoshi Nakamoto is still in progress.
I think this is enough to know what is Bitcoin. Is not it.
Why Bitcoin sensational
There are Various regions to make Bitcoin a real-world sensation.
The main reason is the rapidly growing value of Bitcoin. It takes the power of making money away from central banks, and give it to the general public.
Another main reason is Ananomity. It helps criminal people to transfer the currency anonymously through there network under the eye of law. Their identity remains anonymous.
What are the characteristics of Bitcoin
Bitcoin has several good features that set it apart from other currencies.
1 – It’s decentralized
One central authority doesn’t control the widely spread Bitcoin network. There is a huge number of powerful computers and high-end servers are connected to the network. Every machine that mines Bitcoin and processes transactions makes up a part of the network and a large number of machines work together.
2 – It’s easy to set up a Wallet
To open a normal bank account you have to pass through a various authentication process which may take several days. But Bitcoin wallet can set up in seconds for absolutely free without asking any questions.
3 – It’s anonymous
The identity of the users is completely anonymous. This makes the Bitcoin network more secure.
4 – The transaction process is fast, secure and charges less fee
Every transaction that ever happened in the network is kept in a public ledger called blockchain. The transaction process is very fast. The transaction fee for each transaction occurred is very less.
How Bitcoin works
Bitcoin is very different from traditional currencies, Unlike dollars, euro or pounds as it does not back by any government. Bitcoins are completely virtual coins designed to be ‘self-contained’ for their value, with no need for banks to move and store the money.
Once you earn a Bitcoin it behaves like a gold bar. Now you can convert it into real currencies. Hence there is no need of carrying a bundle of your government issued currency and you can do this with Bitcoin. You can use Bitcoin to buy goods and services online.
You can wrap them and hope that their value may increase. Bitcoin holds every transaction in a simple data ledger file called blockchain. Then the question arrives what is blockchain.
What is blockchain
The blockchain is a public ledger that records Bitcoin transactions. It is like a relational database. Each digital record or transaction in the thread is called a block (assume the name), and it allows either an open or controlled set of users to participate in the electronic ledger.
Each block links to a specific user. The blockchain contains a real and verifiable record of each and every transaction ever made in the system. As the Bitcoin network is a peer-to-peer network, combined with a distributed time-stamping server. Blockchain databases can be managed and can run autonomously to exchange information between distinct parties.
There is no need for an administrator to maintain this. The blockchain users are the administrator itself. The blockchain is the only place that Bitcoins can be said to exist in the form of unspent outputs of transactions.
Find all the stuff related to blockchain here.
Is Bitcoin is legal
Well, the question is obvious when we are talking about a million dollar cryptocurrency legality. The legal status of Bitcoin varies from country to country and is still undefined or gradually changing in many of them. Many countries have a doubt about the existence of the virtual currency. As it is a virtual currency there is always uncertainty about the feature of Bitcoin.
Some countries have given green signal to use, trade and mine, other countries have banned or restricted it. So check once is your country allows Bitcoin or not before stepping foot into the fantasy world of Bitcoin.
The total number of Bitcoin will 21 million and it is fixed.
Already more than 50% of Bitcoin has already mined.
Blockchain size – 166 GB
Annual global mining revenue – $18,002,396,999
Number of Bitcoin.com Wallet downloaded – 500,000
The annual electric consumption by Bitcoin network is approximate – 38 TWh
Electricity consumed per transaction – 272 KWh
Number of US house that could be powered by Bitcoin – 3,440,381
Carbon footprint per transaction – 133.05 Kg
How to mine Bitcoin
So finally you decide to get your hands on the digital treasure. You can buy it, accepting them for goods and services and can mine new one. Simply we can say Mining is the discovery of the new Bitcoin. It is just like finding gold in goldmines.
Mining of Bitcoins is actually the process of verifying other Bitcoin transactions. As per the rewarding system of Bitcoin, A small percentage of the transaction are rewards to the miner.
Let’s take an example, Divide buys a Car from John with a Bitcoin. In order to make sure his Bitcoin is a genuine Bitcoin, miners begin to verify the Bitcoin transaction once.
This is the main mechanism behind the Bitcoin Infrastructure. Hence All transactions are secure and decent. Now you have the clear idea of how bitcoin mining works.
There are various ways to mine Bitcoin.
we have started our discussion of what is Bitcoin. And finally, we reach the conclusion stage. In the age of Information technology, cryptocurrencies are evolving like never before despite its issues, challenges, and controversy. The Bitcoin technology is on the stage as the internet in the 1990s. Bitcoin may take the top position on the currencies in the coming years.