Bitcoin is a digital asset and a payment system invented by Satoshi Nakamoto. Transactions are verified by network nodes through cryptography and recorded in a public dispersed ledger called a blockchain. Bitcoin is unique in that there are a finite number of them: 21 million.
Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services. As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.
How does Bitcoin work?
Bitcoin is decentralized--meaning that it is not subject to government or financial institution control. Instead, Bitcoin is maintained by a peer-to-peer network.
Bitcoin transactions are verified by network nodes through cryptography and recorded in a public dispersed ledger called a blockchain. This process is known as mining.
What are Bitcoin's characteristics?
Bitcoin is unique in that there are a finite number of them: 21 million.
Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services.
As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.
How to buy Bitcoin
The most common way to buy Bitcoin is through a Bitcoin exchange. Bitcoin exchanges are websites where you can buy or sell Bitcoin.
You can also buy Bitcoin with cash. There are several ways to buy Bitcoin with cash, including through an ATM, online, or in person.
What are Bitcoin's benefits?
Bitcoin has several benefits, including:
Decentralization: Bitcoin is not subject to government or financial institution control.
Bitcoin is not subject to government or financial institution control. Anonymity: Bitcoin transactions are not tied to your personal information.
Bitcoin transactions are not tied to your personal information. Security: Bitcoin is a secure digital asset.
Bitcoin is a secure digital asset. Low Fees: Bitcoin transactions are typically much lower in fees than traditional currency transactions.
Bitcoin transactions are typically much lower in fees than traditional currency transactions. Speed: Bitcoin transactions are typically processed and confirmed much faster than traditional currency transactions.
Bitcoin transactions are typically processed and confirmed much faster than traditional currency transactions. Global: Bitcoin is a global payment system.
Bitcoin is a global payment system. Durability: Bitcoin is a digital asset that is not subject to wear and tear.
Bitcoin is a digital asset that is not subject to wear and tear. Portable: Bitcoin can be stored and used on a variety of devices.
Bitcoin can be stored and used on a variety of devices. Divisible: Bitcoin can be divided into smaller units (known as satoshis) to make payments more affordable.
Bitcoin can be divided into smaller units (known as satoshis) to make payments more affordable. Recognized: Bitcoin is a recognized digital asset and payment system.
Bitcoin is a recognized digital asset and payment system. Limited Supply: There is a finite number of Bitcoin available, which helps to stabilize its value.
What are Bitcoin's risks?
Bitcoin also has several risks, including:
Volatility: The value of Bitcoin can be quite volatile.
The value of Bitcoin can be quite volatile. Lack of Regulation: Bitcoin is not currently regulated by any government or financial institution.
Bitcoin is not currently regulated by any government or financial institution. Lack of Protection: Bitcoin is a digital asset that is not currently protected by any government or financial institution.
Bitcoin is a digital asset that is not currently protected by any government or financial institution. Risk of Fraud: There is a risk of fraud when using Bitcoin, as fraudulent activities may occur on Bitcoin exchanges or with Bitcoin-related services.
There is a risk of fraud when using Bitcoin, as fraudulent activities may occur on Bitcoin exchanges or with Bitcoin-related services. Risks with Bitcoin Use: There are risks associated with using Bitcoin, such as potential losses if the currency is lost or stolen.
What are Bitcoin's disadvantages?
Bitcoin also has several disadvantages, including:
Volatility: The value of Bitcoin can be quite volatile.
The value of Bitcoin can be quite volatile. Lack of Regulation: Bitcoin is not currently regulated by any government or financial institution.
Bitcoin is not currently regulated by any government or financial institution. Lack of Protection: Bitcoin is a digital asset that is not currently protected by any government or financial institution.
Bitcoin is a digital asset that is not currently protected by any government or financial institution. Risk of Fraud: There is a risk of fraud when using Bitcoin, as fraudulent activities may occur on Bitcoin exchanges or with Bitcoin-related services.
There is a risk of fraud when using Bitcoin, as fraudulent activities may occur on Bitcoin exchanges or with Bitcoin-related services. Risks with Bitcoin Use: There are risks associated with using Bitcoin, such as potential losses if the currency is lost or stolen.
How to use Bitcoin
Bitcoin can be used in a variety of ways, including:
To purchase goods or services
To pay bills
To transfer money to other individuals or businesses
To donate to charities
What is a Bitcoin wallet?
A Bitcoin wallet is a software program that stores Bitcoin. Bitcoin wallets can be desktop, mobile, or web-based.
What is a Bitcoin exchange?
A Bitcoin exchange is a website where you can buy or sell Bitcoin. Bitcoin exchanges are where you can buy or sell Bitcoin for traditional currency, such as USD or EUR.
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