What is Bitcoin and What is Cryptocurrency?

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Bitcoin has been a buzzword for over 9 years now, but many people still don’t quite get it.

In this article, we will help you figure out exactly what it is, what it’s for, and why you need to know. Bitcoin frequently asked questions.

What is Cryptocurrency?

Bitcoin, or BTC, is a type of cryptocurrency. A cryptocurrency is a digital currency that is extremely secure through the use of cryptography. The cryptography component is key because it’s what allows cryptocurrencies to be reliable, safe, unhackable methods of payment (at least in theory). Cryptocurrencies are decentralized, meaning there is no bank that produces them or single person who manages them. They are maintained by a decentralized network of computers that are constantly doing the requisite calculations and tracking activity. The creator sets up all of the rules and parameters prior to actually creating the currency. The currency is then created during a complex ceremony wherein multiple computers conduct multiple operations designed to encode the currency in a way that is completely secure.

Once a cryptocurrency is set up, any transactions made with the currency are recorded on a public ledger, called the blockchain, in order to preserve security and accountability. However, owners’ identities are encoded, thus ensuring privacy on both sender and receiver’s ends. Transactions can be conducted completely anonymously, making cryptocurrencies ideal for use in illegal transactions or transactions where people don’t want their identities revealed.

What is Bitcoin?

Believe it or not, Bitcoin was the very first cryptocurrency ever created, raising scandal, debate, derision, and a host of copycat cryptocurrencies. Back in 2009, an anonymous creator under the alias Satoshi Nakamoto invented this technology and set the world on a path it would never return from.

When Bitcoin was first introduced to the world, its value was less than a fraction of one US dollar, but as it has become more known and widespread, its value has jumped ever higher. Its value is driven up or down based on demand for it, as interpreted from the bidding on the currency in open markets. As of the writing of this article, the value of one BTC was around $10,400. If you bought $100 worth of BTC back in 2010, then you would be a multimillionaire.

Related: What are the Top Cryptocurrency Companies?

Does Bitcoin Have a Future?

Bitcoin can be purchased from companies or exchanges. The anonymity of the cryptocurrency has led to its involvement in not only illegal transactions but also in more nefarious illegal acts. For example, there was a rash of cases of ransomware in which hackers would access a person’s computer and hold all of their files ransom. Hackers usually requested to be paid in BTC because of its anonymity.

However, increasing numbers of legitimate transactions have been conducted using Bitcoin lately, with more and more regular merchants and establishments accepting BTC as payment. When it debuted, Bitcoin was widely derided, with skeptics doubtful that it would ever have any real value. Yet as it has risen in value, early adopters have seen their initial investments increase dramatically.

Hopefully, this article has answered your question? Even if you don’t end up using Bitcoin in your life, it’s worth being aware of the cryptocurrency and how it works. The creation of Bitcoin was a huge turning point in online transactions and culture, spawning the creation of countless other cryptocurrencies. The technology has always existed, but using it for something as weighty and significant as a currency (let alone one whose single unit is worth almost $10,000) is truly groundbreaking and is sure to direct the future of encryption technology.

What is the Current Price of Bitcoin?

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More Bitcoin FAQs

Here are a few of the frequently asked questions with the popular cryptocurrency.

What is BTC?

BTC is the acronym for Bitcoin. BTC is basically Internet money. Bitcoin is the first decentralized peer-to-peer payment network with no central system.

Who controls the Bitcoin network?

Nobody actually owns this cryptocurrency.

How does Bitcoin actually work?

Bitcoin is similar to a mobile app or computer program. You’ll use a cryptocurrency wallet to store your BTC and send/receive more BTC.

Is cryptocurrency used by other people?

Bitcoin is growing in popularity. The cryptocurrency is being used by many individuals and businesses.

What are the advantages of Bitcoin?

The 4 major advantages of using Bitcoins include more security and control, no transfer fees, total payment freedom, and total transparency. Bitcoin is readily available on the blockchain for anybody to verify and use in real-time.

What are the disadvantages of Bitcoin?

The 2 major disadvantages of using Bitcoins include the lack of acceptance in the world and the volatility of the cryptocurrency.