At the end of this post, You will know:
- What is Bitcoin?
- History of Bitcoin currency.
- How does Bitcoin work?
- About Bitcoin wallet.
- How to Earn/Buy Bitcoins?
- What are the Pros and Cons of Bitcoin?
- Some facts about Bitcoin
What is Bitcoin?
Bitcoin is a form of digital currency. But with 'NO physical existence'. It is virtual.
It was most uncommon form of currency but in the year 2013, it raised from a 1 Bitcoin=13$ value to a unbelievable value of 1000$. As of today, the bitcoin value is 640$ USD (which is 42696 INR).
Only 21 million Bitcoin will ever exist in the world. which means its value will keep on increasing as it keeps on becoming 'rare' in the world.
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| Bitcoin value as of October 2016 |
It is a form of electronic money on which Government or Bankers have NO control of.
Difference between Bitcoin and normal currency is that, The value of Normal currency is governed and regulates by a central bank of a country and depends on amount of Import/Export of goods from that country with other countries. But, Bitcoin's value completely depends on People's confidence on Digital currency. Which means, as the number of people believing in Bitcoin currency increases, its value increases.
Where can you use Bitcoins?
You can use bitcoins with sellers who accept digital currency. Moreover, since Bitcoin is digital, it helps in successful online transactions too. Bitcoins are a quite attractive proposition if you are looking forward to the settlement of International transactions.
As a fact, even Lamborghini automobiles accept Bitcoins as payment method.
The huge success of Bitcoin inspired the launch of new cryptocurrencies like ppcoin, freicoin, litecoin, dogecoin and so on.
This currency is still not common in trade and most people even do not know about this. But according to me, it is completely safe and reliable software based online payment system. Its a digital currency which can be used for payments in exchange of goods.
Some information about Bitcoins:
- It is digital. There is nothing to hold as a piece of metal or paper.
- It is peer-to-peer controlled. Which means only sender and receiver has control of this transfer. No intermediate banks or agents.
- The transactions are visible to people but all they will see is a bunch of digits and alphabets which doesn't make any sense (Cryptography).
- The transfer of bitcoin is completely Encrypted, which means even if someone sees the transfer taking place, no one can decrypt/hack it without the key which only sender and receiver will be knowing. A new level of safety.
- Many sellers/dealers are implementing Digital currency to reduce investments on actual currency processing.
- There is no consumer protection for this currency. It is completely depending on Trust and belief. Which means seller need not send you product for which you have paid through bitcoin. and you cannot officially raise a complaint on that.
- Some countries have even restricted bitcoin for the same above reason.
How does Bitcoin work?
To know it better, Watch this video below.
Bitcoin wallets:
These are some online wallets like PayPal to store the Bitcoins you have earned. You can Buy/Sell/Trade Bitcoins from this wallet (this depends on whether there is support for the same in your country)
Create your first Bitcoin wallet now
- Go to 'coinbase.com' (click here).
- Enter your details and confirm your E-mail address.
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| See 'Wallet address' in the picture |
- Click on 'Wallet address' which is at the top right corner of the Homepage.
- You will get a wallet address like this
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| Wallet address |
- You will need to use this address to Buy/Sell/Trade Bitcoins.
How to make money using Bitcoins?
There are Four methods to make money on Bitcoins.
- Invest in Bitcoins
- Get free Bitcoins
- Bitcoin mining
- Sell products for bitcoins
- Invest in Bitcoins
1. Invest in Bitcoins
- Simple Method.
- Buy Bitcoins and sell them at higher prices.
- Doesn't need much technical skills.
- Buy Bitcoins from CoinBase and earn 10% extra bonus (only through referral link- click here).
- You can refer to any users using your referral link from your coinbase account. This will get you 10% Bitcoin earnings for every 100$ worth of Bitcoin purchased from your referral link.
- This requires you to do some task so that you will get Bitcoins in return.
- Tasks involve some actions like Clicking or Viewing Ads or working your skills/resources for bitcoins.
- There are some websites designed for the same.
- FreeBitco is a website where you can earn bitcoins by just playing lucky number games. Visit FreeBitco ( you will get 0.00000001 BTC for joining using this link.)
- Lucky number game can be played once in 60 minutes (see picture below)
As simple as this
Other websites to earn Bitcoins:
- BitCoinTalk is a forum which helps you search for jobs that earns you Bitcoins. Many jobs here can be completed in short amount of time and hence you can earn Bitcoins easily (visit Bitcointalk)
- Visit Reddit r tag 'Jobs4bitcoins' and find some tasks suitable for you.
- Bitgigs also provides same functionality.
3. Bitcoin Mining
This method is quite complex. But this infographic below, helps you understand it with ease.
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| credits: bitcoinmining.com |
Read exact article of Bitcoin mining at 'Bitcoin Wiki'.
4. Selling your own products with bitcoins:
- With this method, you can sell products to customers in exchange with bitcoins. This is normal way of trading but with the exception that currency is digital.
- Learn how to accept bitcoin for your business, click here.
At last,
Pros and Cons of Bitcoin currency
Pros:
1. Low transaction fees
Since there are no intermediate payment processing systems, transaction fee is less or sometimes zero.
2. Bitcoin is deflationary
Since only 21 million bitcoin can ever exist in the world, its value will keep on changing but not amount of bitcoins.
3. No Taxation
No tax charges for international transactions since Givernment or Bank have no control over it. A very huge advantage
4. Privacy
Since Bitcoin transactions are encrypted, it gives privacy to transactions.
5.Simple to use
Obviously.
6. Bitcoin is not regulated
No Government has rights over bitcoin and hence it cant be regulated through them. only allowing in country is depending on the Government.
Cons:
1. Bitcoin requires some learning.
Since it is not like any other currency, a person dealing with this should have certain knowledge of the same. By reading this post, I hope you got most of the information about this digital currency.
2. Not accepted in many places
Since bitcoins aren't yet popular, this currency is not being accepted in many places now. however popularity of bitcoin is increasing day by day, this will be rectified soon.
3. Time consuming.
Its easy to obtain but at the same time, time consuming too.
4. Transactions can be slow at times
since this is peer-to-peer transactions, when more number of transaction take place at the same time, timer for some transactions may expire and the same can fail sometimes.
5. Bitcoins can be stolen.
As this data is digital, and stored in some online databases like wallets, there is a possibility of these being stolen. so choose bitcoin wallets wisely. CoinBase is a safe and trusted wallet.
That is all about Bitcoin. Share this article with your friends and popularize this currency. Let me know your thoughts about this article in the comment section below :)
Credits:
Prashanth sachan, Dolan for inspiring me on this currency.
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