What is Bitcoin(BTC)? How to use Bitcoin?

What is Bitcoin ?

Bitcoin is first cryptocurrency or decentralized money as a solution against Fiat currency. Bitcoin was created after 2008 crisis, by some anonymous person or group of people. It was the starting of decentralization in finance industry. The Whitepaper was released about “what is bitcoin”, “how it works”, “how it will help in finance world” etc. It is like internet in early 90’s. And today bitcoin is still undiscovered by majority of world’s population. Ethereum

What is Bitcoin(BTC)?

In simple and easy word’s, Bitcoin is a Digital version of money but way better than Fiat money. We can understand it by some simple points.
1) Bitcoin is limit, with total supply of 21Million. Current supply as of today 18M (18,836,268 BTC).
2)Bitcoin is Decentralized, which means it’s not in control of single organization or single person.
3)Bitcoin is not inflationary, like USD or any other real world currency’s.
4)Bitcoin is a ledger system, which means it store transaction in block’s. That can be checked even after 100 years from now.
5)Bitcoin is a Blockchain technology which works on Proof of Work algorithm.
6)Bitcoin is open source, so anyone can check it’s code and transaction easily.

Just think if you had invested $1000 in 2014, today it’s value is $10Million.You can buy and sell bitcoin on exchanges like stocks. People treat bitcoin as Digital Gold, which lead to supply shock in circulation of bitcoin. Because everyone who knows about bitcoin is staking more and more. Due to this, Price of Bitcoin rise drastically there was a time when 1 BTC is worth of $50 and now it’s worth of $50,000. As time pass by, it’s value will continue to increase. In this year 2021, Bitcoin is officially a legal source of exchange in EL Salvador. Now, many country’s are getting ready to legally accept Bitcoin in foam of value. By this news Big fund manager, institutional investors are getting in to hedge there fund against inflation.

How does Bitcoin works?

Bitcoin is a Blockchain technology, which works on Proof of Work System(POW). First there’s a wallet with it’s address, from this address you can accept BTC from anyone.

Bitcoin address Example
wallet address

Now, if I want to send BTC to you. Then I need that Wallet address for payment. This payment transaction will go to block, which will be verified by BITCOIN Miner’s.

Bitcoin blocks update
Latest blocks create.

When all the Miner’s will confirm the transaction. The payment will be send to your wallet. And the transaction will be stored in Blockchain. It takes 10min to create and finish a Block. And it can store 500 Transaction in it. All the transaction can be checked here Blockchain.com

Bitcoin transaction tracker
Transaction Tracking

How to use Bitcoin?

Well it’s upon you to use bitcoin. But by the Grace of Bitcoin Founder Satoshi Nakamoto. In reality no one has seen Satoshi Nakamoto in there life. Many website’s and people say that this person had create bitcoin. And he never came in front of public for some reason, no one know “he is dead or alive”. You can use your bitcoin to buy Tesla car, because they accept bitcoin payment. You can buy anything from salt to star buck’s coffee, if you lives in EL Salvador. But intelligent people prefer to store more and more BTC. So, they can have Value in Future.

What is/are Bitcoins Mining?

You have studied about coal mining or diamond mining in school time. Now the time has changed this Bitcoin Mining is done by powerfully computers. In proof of work system, before every block is create there’s a puzzle to solve. This complex puzzle can’t be solved by humans. For this complex solution, Miner’s need super fast and powerful computers. In every block 500 transaction is stored and each block creating time is 10min. There are many miner’s who try to solve puzzle, the one who solve first get a chance to create block and get paid 6.25 BTC for mining the block. This process is repeated after every 10mins, all miner’s computers starts to solve new puzzle for block creation. Hence, this is bitcoin mining.

What is Bitcoin Halving?

Halving is process of cutting reward prize for miner’s after every 4 years. Now you will think why after every 4 years? Because Proof of work in bitcoin it’s algorithm is set with calculation. Every new block enter in chain takes 10min to create. And every halving comes after 210,000 blocks are successfully added to chain and that is roughly 4 years. In year 2020, the third halving had taken place from 12.5 BTC to 6.25BTC reward for block creation. So, this process will continue till Year 2140 until all the bitcoin are mined. After that all miner’s will be paid for there transaction process fee.

Conclusion Take way

  • Bitcoin is decentralized digital asset. And used for store of value.
  • Bitcoin supply is limit at 21Million.
  • BTC block is mined by powerful computers, then added to chain.
  • BTC halving comes after every 210,000 block or 4 years are complete.
  • It’s impossible to hack it’s chain.
  • Your today’s transaction can be checked by your Grandchild in future.