What is bitcoin and how does it work?

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The question what is bitcoin has been asked many times both online and off-line. This remains one of the most asked questions on search engines. I believe you’ve been hearing about crypto-currency or bitcoin a lot lately. Since you are one of those who want to know about bitcoin then you have come to the right place.

What is Bitcoin anyway?

Bitcoin is a decentralized digital currency that can be used on the internet. Is not actual money but is a peer-to-peer crypto-currency meaning it allows transactions between two people without the involvement of the third party or middleman such as banks other financial institutions.

This makes it’s fees to be lower than the bank changes. In actual fact, a bitcoin transaction can cost you as little as few cents for a huge amount

A brief history of Bitcoin

It was started in 2009 by a person or group using the alias of Satoshi Nakamoto. They started the crypto-currency as an open source system that can be used and improved by anyone who’s interested in it. Since bitcoin is an open source it allows anyone to get involved and to improve the global financial systems for the better.

The first official transaction of bitcoin happen in May 2010 when Laszlo Hanyecz bought two pizzas for 10, 000 BTC, at the time, the bitcoin price was next to nothing($0.008).

That transaction pushed bitcoin upwards to the price of $0.08 in less than a week. Since then the highest bitcoin price recorded is $19.783.

Bitcoin has grown to be a multi-billion dollar industry in market cap($113Bln).

How does bitcoin work

Bitcoins are generate by miners(mining machines connected to the blockchain network) and stored on blockchain, which is a public ledger that keeps record of all bitcoins generated. Bitcoin miners also validate every transaction and on the network.

Each miner is rewarded a certain percentage for their work. This helps the bitcoin network to function as more miners receive their share.

For a further understand of bitcoin wach this video from usecoins.com.

How to get into bitcoin

For anyone to use bitcoin they need to have a bitcoin wallet, a wallet helps store bitcoins. There are many wallets to choose from, there are online wallets of which are very common, software wallets and hardware wallets that can be carried anywhere.

After opening a bitcoin wallet you might want to buy bitcoin and send them to someone or buy something online with it.

Conclusion

If you have questions about what is bitcoin you are  welcome to ask and we’ll be ready to answer. But for a more