What is Bitcoin?
Bitcoin is a digital currency created in 2009 by an anonymous person or group of people who chose the name “Satoshi Nakamoto.” It’s completely decentralized, meaning that no one owns it, and no one controls it— there is no “Bitcoin Inc,” and no Bitcoin CEO. Bitcoin are created when a powerful computer solves a complex set of cryptographic problems in a process called “mining;” the Bitcoin is the reward.
It’s a fairly new type of currency, not controlled by any government or centrally processed by any bank or company. You can use it to buy things, though don’t expect your corner store to necessarily take it, and increasingly it’s used as an investment.
You could think of it as a sort of gold for the digital era. Like gold, no one centrally controls production, supply is limited in part by the effort required to produce it, and you can hold on to it as a store of value.
How to mine bitcoin?
Mining bitcoins is a relatively straightforward process. If you don’t wish to delve into the details or learn how to optimally configure your bitcoin mining hardware, you can easily just download bitcoin mining software, start it up on your computer, and you’re already mining bitcoin. You could even start mining a few Satoshi before finishing this read.
Can I pay with Bitcoin?
You can! Thousands of retailers accept bitcoin currently. Purse.io is one great site that gives you discounts for paying in Bitcoin—right now, for example, you get 15 percent off Amazon purchases. There are also Bitcoin debit cards, like BitPay and Shift (Coinbase). For most people, though, I wouldn’t recommend making everyday purchases with Bitcoin.
How Bitcoin Works
Bitcoin is a digital currency. That’s a concept that might be more complex than you realize: it isn’t simply an assigned value of money stored in a digital account, like your bank account or credit line. Bitcoin has no corresponding physical element, like coins or paper bills (despite the popular image of an actual coin, above, to illustrate it). The value and verification of individual Bitcoins are provided by a global peer-to-peer network.
Bitcoins are blocks of ultra-secure data that are treated like money. Moving this data from one person or place to another and verifying the transaction, i.e. spending the money, requires computing power. Users called “miners” allow their computers to be used by the system to safely verify the individual transactions. Those users are rewarded with new Bitcoins for their contributions. Those users can then spend their new Bitcoins on goods and services, and the process repeats.
The biggest challenge to a digital currency is what’s called double-spending.
Without a bank or credit card or other intermediary acting as a trusted third party, confirming that the same number of dollars come out of one person’s account and go into another, it’s hard to make sure people aren’t spending the same digital money in multiple places or multiple times.
Trading method types For example,
day trading involves conducting multiple trades throughout the day, and trying to profit from short-term price movements. Day traders spend a lot of time staring at computer screens, and at the end of the day, they usually just close all of their trades. Scalping is a day-trading strategy that a lot of people are talking about. Scalping attempts to make substantial profits on small price changes, and it’s often referred to as “picking up pennies in front of a steamroller.” Scalping focuses on extremely short-term trading, and it’s based on the idea that making small profits repeatedly limits risks and creates advantages for traders. Scalpers can make dozens—or even hundreds—of trades in one day.