23.08.17 246 888 0

What are bitcoins

And can you make money from them?

Bitcoin has quadrupled in price since the beginning of 2017.

Money that does not exist is worth more than oil and gold. Let me tell you how you can make money from it.

Antonina Asanova

tried to trade bitcoins on the exchange

In May this year, I tried bitcoin trading. Earned 30% in 2 weeks. Then in a month she lost 15%. While this article is being prepared, I may re-trade 15%, or I may lose even more.

Cryptocurrency trading is a risky business. Here's what you need to know if you like this kind of risk.

ATTENTION

What is bitcoin

Bitcoin is digital money. Physically, this currency does not exist, there are only special registries that keep track of how many bitcoins someone has and who transfers them to where. These logs are called blockchains.

This is similar to how cashless payments are arranged in banks: when you pay with a card in a store, you also do not transfer any physical money or gold to anyone. It's just that your operation is registered somewhere in the bank register.

Bitcoins differ from conventional currency in that registers are not stored centrally in banks and payment systems, but simultaneously on all computers that are occupied with bitcoins. Anyone can with all the bitcoins in history.

The registries are protected by cryptography. You can't fake them all at the same time. It is impossible to rewrite the data in blocks and claim that someone now has millions. Bitcoin is pretty secure in this sense. True, there is already an attack that allows you to pay twice with the same bitcoins, so it’s impossible to say that bitcoin is absolutely safe.

Where do bitcoins come from

The state issues the regular currency. It is very indirectly connected with gold reserves, but in fact it is not connected with anything - as much as the state needs, so much it will print.

Bitcoins are not associated with any one state. New bitcoin units are created as computers on that payment network serve the needs of that same network.

For example, somewhere in China, a person paid with bitcoins for pizza. This operation must be recorded in the registries on all computers that are connected to the bitcoin network. To record an operation in the register, you need to seal it with a special signature, like a wax seal. This signature needs to be calculated, this is a complex computer task.

Somewhere in Venezuela, there is a computer that runs the bitcoin network. He just computed this cryptographic signature. As a token of gratitude, the owner of this computer receives a reward in the form of a bitcoin penny.

For a Venezuelan who has set his computer to calculate cryptographic signatures, it looks like this: his computer rustles something there, and bitcoin pennies are dripping into his account. The computer seems to be mining bitcoins, although in reality it simply encrypts and prints other people's transactions. This is called mining - as if "extraction" of bitcoins.

In fact, it is not bitcoins themselves that are mined, but sealing wax to protect registries. Bitcoins - this is a reward for the service.

Mining is a separate big topic. In a nutshell: the equipment is expensive, the efficiency is low, you will have to compete with the megawatt Chinese mining clusters that are built on the basis of power plants. We will write a separate article about mining later.

Why you need bitcoin

Cryptocurrency allows you to transfer money under a pseudonym and without the participation of banks. This is relevant for transactions with people and companies from countries outside the CIS.

For bitcoins, you can buy an Airbaltic ticket, a Dell computer. You can even donate funds to a Buddhist temple in Seoul.

Where Bitcoins are accepted for payment - map from Usebitcoins.info

Bitcoins are traded on the stock exchange, money is invested in them.

Since 2015, bitcoin has risen in price from $200-$300 to $4,000 and continues to grow. This has made cryptocurrencies interesting for investment and speculation.

Interest is fueled by success stories. In 2009, Norwegian student Christopher Koch randomly bought $24 worth of bitcoins. He remembered the investment 4 years later, when his fortune reached 885 thousand dollars. And I bought an apartment in Oslo with part of the money invested.

Bitcoin wallets are used for transfers and payment for services. They store the digital keys required for transactions. If you lose your private key, then the money will be gone forever. They cannot be returned by calling the bank. The bitcoin system has neither a single center nor a regulator.

Under a pseudonym is not anonymous

Bitcoin transaction registries contain the entire transaction history for all time for all wallets. If you bought something bad for bitcoins, and then somehow it became known that this wallet was registered with you, then the interested person will be able to see all your operations.

For example, if you bought a plane ticket for bitcoins and indicated your personal data when paying, then the interested intelligence services will already be able to identify you.

There are, of course, means of complete anonymization of payments, but they are expensive.

It is legal?

The Central Bank and Rosfinmonitoring warned against the use of bitcoins. At the same time, the State Duma is preparing a bill that will legalize the purchase of cryptocurrencies for use abroad and bitcoin trading.

As long as the circulation of bitcoins is not regulated by the government, banks and other companies cannot sell them. Cryptocurrency exists in the world of dashing nineties. They can be bought from individuals, online exchangers or trading exchanges.

Important clarification

We provide a basic scheme for buying and selling bitcoins through an exchanger and an exchange. All examples are in rubles, to make it clear.

There is no universal way. If you have your own recipe for cryptocurrency trading - come in the comments.

How to buy bitcoin through an exchange

Internet exchangers work on the same principle as street exchangers that change euros and dollars. They buy bitcoins at a price below the exchange rate, sell - more expensive. They make money on the difference.

There are many popular exchangers: Bestchange.ru, Okchanger.com, Localbitcoins.net. In them, you can exchange rubles for major cryptocurrencies.

I compared the rate on different platforms and chose LocalBitcoins. Buying cryptocurrency took 10 minutes. Another 20 minutes bitcoins went to my wallet.

How to use. Enter in the search the amount for which we want to buy bitcoins. Choose the lowest rate and the appropriate payment method. Most often, they offer an exchange to Sberbank and Qiwi account holders.

If the seller agrees to the deal, he reserves the required amount. When you transfer rubles to him, he will send bitcoins to your wallet. Now you can buy something or transfer coins to a more secure wallet on a PC or flash drive.

Minuses. Exchange rates are very high.

Commission. Localbitcoins charges a withdrawal fee of 0.00039629 BTC. I invested a thousand rubles, and received bitcoins for 826 rubles. Transactions absorbed 17.4%.

For larger amounts, the fees are lower. With exchangers, you can agree on individual conditions.

Nobody regulates the market of exchangers on the Internet. No one guarantees the security of transactions. If in doubt - do not transfer money or try to exchange a small amount first. Take into account the huge commission of exchangers when buying goods or investing money in bitcoins.

How to buy bitcoin through an exchange

Exchanges are online platforms for trading cryptocurrency. They meet sellers and buyers of bitcoins. If there are more sellers, the rate falls. If there are more buyers, it grows.

To register on a small cryptocurrency exchange, an email address is enough. Large sites require you to enter your name, address, date of birth, and phone number. The larger the amount you change, the more personal data you will have to disclose.

At the end of July, the largest exchange that worked with rubles, Btc-e.com, closed. There are smaller exchanges left: Exmo.me, Livecoin.net, Cex.io. When choosing, pay attention to two points: the currency selling rate and the money input system. Some exchanges accept Yandex Money and Qiwi.

If you need to exchange several thousand dollars, choose a large exchange. Smaller venues may not have enough vendors. The most significant exchanges are Bitfinex.com, Kraken.com, Bittrex.com.

We write not only about digital money, but also about other investment tools, ways to save on the usual things and save up a financial pillow.

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My experience. The Eksmo exchange approached me. I transferred rubles to her through Qiwi. Although now this method has already been excluded. Money went to the exchange for almost 2 hours. Transfer to bitcoins is instant.

How to use. First, we replenish the account on the exchange. We put rubles on an electronic wallet. On the website of the exchange, we press the button “replenish with rubles”. Choose a payment method, amount and transfer money.

Transferring rubles to the Eksmo exchange

Now we buy bitcoins. On the website of the exchange, we select the currency pair bitcoin-rubles. We find the block "Purchase, BTC" and enter the desired amount.

Minuses. Exchanges sometimes block the withdrawal of funds for 1-2 days after replenishing the account. This is explained by the rules of payment systems. Information about blocking is indicated on the page for entering money.

Commission. Exchanges charge 4-6% for entering rubles. Exchanges also charge a fee on every transaction. As a rule, it is 0.1-0.3%. There is also a commission for withdrawing bitcoins - 0.001 BTC. As a result, out of a thousand, 805 rubles remain.

You can save if you use a dollar or euro card, as well as register in the international payment systems MoneyPolo or ADVCash and replenish through them. In this case, exchanges can credit funds without commission at all.

To choose the most convenient and cheapest way to exchange, you will have to register on several services. Decide in advance where you will write passwords.

Anonymous methods of depositing and withdrawing money are more expensive than legal ones and much more risky. Using bitcoins is like walking down the street wearing a mask but with transparent pockets. The system does not reveal the owner of the wallet, but all transactions are recorded on a public blockchain. Sometimes government agencies manage to connect bitcoin wallets with real people by IP address or purchase delivery addresses.

To achieve anonymity, users transfer money several times between new bitcoin wallets, use the anonymous Tor network and bitcoin mixers - for example Coinmixer.se. In the mixer, transactions of different users are split and mixed. As a result, it remains a mystery who transferred how much and to whom. The service costs 1-3% of the amount.

On Localbitcoins and forums, you can find a person who will exchange bitcoins for cash. It's also almost impossible to trace them. However, this method of exchange is very risky: on the forums, you can stumble upon scammers and be left without money.

How to sell bitcoin

Let's say that since you bought bitcoins, their rate has grown so much that it has outgrown all your costs for commissions and transfers. It's time to sell bitcoins and take the money earned. In this situation, you can again use the exchangers or withdraw money through the exchange.

An experience. I withdraw funds from the Eksmo exchange to the card. Of all the withdrawal methods, I choose the cheapest one - the Capitalist.net service. Transfer from the exchange to the card takes less than a minute.

How to use. Register with Capitalist. In the exchange wallet, select the withdrawal of rubles and enter the account number of the “Capitalist”. Then we transfer money to the card "Visa" or "Mastercard".

Commission. You can transfer bitcoins to the exchange wallet without commission. "Capitalist" takes 2.5% for the transfer to the card.

Do not transfer bitcoins before they send you rubles for them. Bitcoin transactions cannot be cancelled.

How to earn on bitcoins

On the net you can find many educational videos, blogs and forums where they promise an income of 20% per month. The general idea is to buy bitcoins at the minimum rate with minimum commissions and sell at the maximum rate, but also with minimum commissions.

It seems that trading currencies is easy, but it is not worth taking risks right away. The bitcoin exchange rate changes very quickly and dramatically. To get started, try trading with an amount that you don't mind losing. When you manage to earn consistently, you can play for high stakes.

The least risk when trading with the trend. To do this, you need to bring money to the exchange, wait for the moment when the rate has fallen and is just starting to grow. And then buy bitcoins and wait for the rate to peak. With such a strategy, it is safer not to store bitcoins on the exchange, but to transfer them to a separate wallet.

Stock trading is work. Players monitor the exchange rate constantly, check with Chinese exchanges. In order not to miss rate fluctuations, you can download the Bitcoin Paranoid app. As soon as bitcoin starts to fall or rise, the alarm will go off. Bells can be placed on Bitcoinwisdom.com.

You can also make money on ICO, Initial Coin Offering is an analogue of crowdfunding or entering the exchange. You invest in a new company, a startup, and for this you receive tokens - a kind of shares. If you are lucky and the company grows, you will receive income.

At the time of this writing, the ICO procedure, like many other things in the field of cryptocurrencies, is almost not regulated and not protected in any way. Companies can enter the ICO without a product and a real business, just to collect money from investors and go into the sunset. Therefore, invest in companies at your own risk.

They are also investing in new cryptocurrencies. In addition to bitcoin, there are several hundred of them. The monero exchange rate has grown 40 times over the past year, from $14 to $585. Ethereum and Dash have risen in price by 17 times.

Investments in ICO and new cryptocurrencies are high-risk. To assess the prospects of a startup, you need to understand blockchain technologies and business.

Remember

1. Cryptocurrency is a risky business. Bitcoin is still not out of the experiment. In Russia, it is not legalized. None of your rights are reserved here.
2. Take care of protecting your wallet and store your passwords securely. Lost keys cannot be recovered.
3. Check service fees before transferring funds. Transactions can eat up 10%, 15%, and even 20%.
4. Do not transfer bitcoins until confirmation that the currency was transferred to you for them. Cryptocurrency transactions cannot be reversed.
5. If you keep money in bitcoins, follow its rate.
6. Start trading with an amount that you don't mind losing.
7. Professional bitcoin trading is a full-time job. If someone promises guaranteed income without effort, chances are that someone will make money off of you.

The increased hype around cryptocurrencies is caused by the high popularity of Bitcoin (Bitcoin). It is recognized by many as a full-fledged settlement tool. But in order to understand what bitcoins are, where to get them from, you should first understand the history and technical part of its creation. And the first thing to learn is virtual currency. Unlike the US dollar or the Russian ruble, it is not backed by material resources.

There is a constant debate as to who created bitcoin. According to the official version, this is Satoshi Nakamoto (Satoshi Nakamoto). It is he who is credited with the idea of ​​an electronic payment system based on mathematical calculations. The concept of the emergence of cryptocurrency is the reason for its features - the digital nature ensures decentralization, even distribution of the bitcoin system around the world.

Where do bitcoins come from

There are several ways to become the owner of bitcoins - buy them in exchange for rubles or other real currency, receive them as a reward for the work done. But the original source is mining: generation through mathematical calculations. Theoretically, owners of any computers can install mining programs in order to earn virtual currency bitcoin.

When they try to understand everything about bitcoins, they first of all study the issues of its production.

In practice, the following features of bitcoin mining have developed:

• The economic feasibility of mining depends on the power of the computer. The most powerful gaming video card should be installed in it, then it makes sense to engage in generation.
• Before starting round-the-clock work, it is worth measuring the speed of mining, and then comparing the real costs of electricity with the profit received.
• You can significantly speed up the procedure for receiving bitcoins by joining a pool with like-minded people. Due to the common network computing resources of each of the participants.

The high complexity of calculations limits the rapid generation of the BTC currency, the process rests on the limited power of typical home computers (even for gaming configurations). Therefore, the transition to professional cryptocurrency mining is carried out through the purchase of specialized equipment. It is able to calculate / calculate BTC with maximum efficiency, since the hardware and software of such a technique was created exclusively for this purpose.

How to organize bitcoin mining yourself

The main purpose of using special equipment is to speed up calculations. After all, bitcoin is “created” in the process of accumulating “satoshi”, the share of cryptocurrency generated in a more reasonable time. But satoshi itself has no value, so users either buy expensive equipment or cooperate in associations. The latter take advantage of cloud technologies that make it easy to operate remote facilities via the Internet.

Bitcoin mining can be carried out on an industrial scale

Options for building local farms for mining online currency:

• Motherboard with multiple video card slots. All slots are filled at once, and it is required to purchase top models with the highest computing potential.
• Specialized boards with installed video chips. It is on them that it is easy to achieve the required computing speed (video processors are adapted for processing streaming data).
• A complex based on proprietary ASIC processors designed for fast bitcoin mining.

A computer on standard video cards is cheaper, but its purchase will also have to be beaten off. Therefore, more and more focus on the possibilities of cloud pools. Such services charge a certain commission, but they work around the clock, do not consume electricity at home. There are also no risks of breakage, temporary power outages.

Advantages of bitcoin according to the creators

The electronic currency bitcoin was created as opposed to real money. The creator focused on the decentralization of control over the movements of "cash" and maximum protection against theft.

In simple words, bitcoin was intended to become a competitor to national currencies.

The result is a product with the following features:

• Instant transfers. Electronic money like WebMoney or Qiwi have the same characteristics.
• Bitcoin transfers 24/7/365. The best features of EPS are preserved here.
• The use of public/private cryptographic keys provides a high degree of protection. Virtual currency is securely closed from hackers.
• Easy crushing into small parts. The user can send a thousandth of a dollar with minimal fees.
• Complete anonymity. No one without the knowledge of the owner will know about his wallet, the amount of savings.

The absence of a single server makes the bitcoin system independent of the policies of states. Transfers take place without intermediaries, which reduces the risk of loss due to incorrect operation of third-party resources, fraudulent actions of third parties. The virtual monetary unit bitcoin is capable of becoming a world currency if large countries and their unions accept it as an official means of payment.

How the course is set

The popularity of bitcoin compared to its counterparts (on the cryptocurrency market) is associated with a fairly rapid growth of the exchange rate against the US dollar. Over the past few months, its price has increased several times. Beginners in the financial markets often begin to learn what Bitcoin is from a detailed acquaintance with the dynamics of changes in their value.

Despite the lack of material support, cryptocurrencies are increasingly dependent on economic and political events taking place in individual countries and in the world. The following points affect the rate increase:

• Acceptance by the state of bitcoin as an official means of payment.
• Distribution of payment by bitcoins for goods and services in online stores.
• The transition of freelance exchanges to payment for work performed with cryptocurrency.

The rise in the price of bitcoin has attracted a large number of investors buying it for real money, which further spurred sharp jumps in the market value. Today, one bitcoin is a fortune.

The fall in the rate is usually associated with negative news about the cryptocurrency. So, in the Russian market, work is underway to establish control over its turnover, as well as attempts to limit the total amount of bitcoin ownership for individuals. Time will tell what exactly will pass into the legislative initiative and, as a result, into the adopted law, but at the time of publication of such statements, short-term price spikes are possible.

Ways to get bitcoins to your wallet

The issue of creating your own wallet in the bitcoin system is raised in several cases. Firstly, the user may need a means of payment that the service provider, business partner, is counting on. Secondly, there may be a calculation for earnings due to exchange rate fluctuations. Then the wallet will become transitory, its owner, after a certain growth, will constantly sell the cryptocurrency and wait for its subsequent fall in order to buy it again.

If you already have a wallet, you can replenish it by doing work on freelance exchanges. In the Internet sphere, payment for services / goods with electronic money is still the main means of payment, so you can agree on a specific "currency". Along the way, you can connect to one of the cloud mining services and replenish your account as you go through the calculations there.

Mining the Internet currency Bitcoin with your own resources (on your home computer) becomes unprofitable. The cost of top-end graphics cards has risen sharply during the boom period (summer 2017) and is not falling, which reduces the profitability of mining at home. It is more profitable to count on connecting to pools or receiving Bitcoin as a reward for work.

Why Bitcoin is useful in real life

The high dynamism of the bitcoin exchange rate attracts investors who prefer assets with high volatility. Cryptocurrency has just begun to spread as a means of payment, but Forex brokers have actively connected to the situation and have introduced instruments like BTCUSD in addition to currency pairs. Traders who previously worked only with real currencies got the opportunity, in the process of studying what bitcoin is, to replenish the portfolio with a new instrument.

As a result, there are several methods of earning on bitcoins:

• Purchase in order to wait for a significant increase in the exchange rate against the ruble or dollar (depending on the currency in which the buyer keeps savings).
• Buying / selling on the Forex market and betting on the options market. Allows you to make a profit on the fall and growth of the course.
• Direct transactions for the purchase / sale of bitcoins with constant tracking of the rate.

The advantage of cryptocurrencies may be that mining requires significantly fewer material resources than the direct exchange of money. As a result, payment for the work of performers occurs at the expense of the shares received “free of charge”.

How does the government feel about cryptocurrencies?

Different countries establish the legal status of bitcoin independently. In Russia, it has not yet been (officially) classified as a currency or other means of payment, so when buying a cryptocurrency, one should take into account the risks. The state, not having control over the bitcoin system, cannot protect the citizens of its country. At the same time, Russians have access to opportunities to earn money on exchange rate changes. A trading account can be created in the usual currency - US dollars, euros or Russian rubles.

There is no direct ban on owning bitcoins in Russia. But the government systematically returns to the discussion of the situation. For example, an initiative was announced to limit the total amount of bitcoin ownership by individuals. It is important that despite any legislative changes in the Russian Federation, the possibility of earning on fluctuations in the bitcoin rate remains. It is enough to select the appropriate instrument and start trading (buy when the rate rises and sell when the rate falls).

We have all heard that Bitcoin is called “electronic gold”, “gold coins”, and other allegories are also given. But now these are not just beautiful words!

In March of this year, another historical fact was recorded - Bitcoin was equal in price to real gold, reaching $ 1,238. Now, at the end of November 2017, the price for 1 BTC is as much as $8200. The coin is growing at a frantic pace.

Skeptics argue that this cryptocurrency is just a dummy, not backed by anything. Yes, that is right. But what is gold in its essence? People, come to your senses, but it's just metal! He is also not provided with anything. Its value lies only in the fact that society has agreed among themselves to consider it valuable. Everyone just believed it. Same with Bitcoin. As long as they believe in it, it has power.

Briefly what is the essence of Bitcoin

Bitcoin (eng. Bitcoin, from bit - “bit” and coin - “coin”) is a digital currency that can be paid on the Internet. You can instantly send digital coins directly to any person anywhere in the world (“peer-to-peer” - from peer to peer), and this does not require a bank or any other intermediary, which means that there are no transfer fees exists!

This is the first and very significant plus - that is, you have already saved up to 30% right away (comparing, for example, with expensive Western Union transfers) just because you do not pay the bank for its services.

So why is Bitcoin (“bitok”, BTC) now at the peak of popularity? Since the beginning of 2017, and until today - November 2017, the most expensive cryptocurrency in the world has grown by about 8 times. Its cost has risen from $950 to over $8,000 per unit. It is not for nothing that so much attention has been paid to this currency lately, because it has already become part of our everyday life, and it seems that forever.

Advantages of "digital gold":

• no commission for transfers;
• transfer speed - instant;
• international currency, you can send and receive in any country, it has no borders;
• reliability - the currency cannot be counterfeited, the operation cannot be carried out dishonestly;
• anonymity - the participants in the transaction know only the account numbers of each other, the names are kept secret;
• not subject to inflation;
• is a convenient virtual alternative to real money.

Usual money is divided, as you know, into 100 parts, and one hundredth is a penny or a cent. Bitcoin, on the other hand, can be divided up to 8 digits, which means that even one hundred millionth part can be used in circulation - that is, 0.00000001 BTC. This tiny particle is called after the name of the creator of this currency. This is incredibly convenient, as you can transfer even the minimum amount in the absence of commissions.

Another curious fact embedded in the Bitcoin algorithm is that the total number of issued coins is 21 million. When this figure is reached, the release of coins by the program will stop forever. Based on calculations, this will happen no later than 2140. Now the number of issued units has already exceeded half.

The reward received by users for creating a new block becomes smaller over time. Until 2013, it was equal to 50 coins, later it decreased to 25, now it is only 12.5 BTC. Thus, the excitement is growing, and earning the coveted coins is becoming increasingly difficult.

Of course, Bitcoin is a pioneer in the world of cryptocurrencies, but today it has many competitors, such as Dash, NEM, Monero, NEO, and hundreds of other digital currencies, the total number of which has already exceeded one thousand.

In 2008, someone under a pseudonym created an electronic payment system and launched the Bitcoin network, and also released the first version of the wallet of the same name. The identity of this person is still unknown, and a lot of rumors about this go around the network. There are suggestions that he is American, or even that it may be a group of people. The lack of information on the Internet has served as a reason for humor, some of them have already begun to call him Santa Claus or even an alien.

But seriously, one thing is clear - Satoshi Nakamoto is an incredibly rich man, and he no longer needs to support the system. By his own statement in 2011, he decided to retire.

In 2010, an American from Florida named Laszlo, who was fascinated by new virtual coins, decided to have some fun on a forum of like-minded people, and for the sake of a joke he promised his Bitcoins to those who order pizza for him. And such a person was found, having bought 2 pizzas in exchange for 10 thousand BTC (about $25). This was a historic event, because after a couple of months they were already worth $600, and six months later - more than $2.5 thousand. Now this amount corresponds to 80 million US dollars. This example demonstrates very clearly how fast growth is.

One of the sites informing about cryptocurrency rates even brought out the cost of that pizza at the current rate as a separate item, as a good example.

Bitcoin followers

Roger Verr invested 1 million dollars in Bitcoins in 2011, and after 2 years their value increased 100 times and amounted to 1 billion dollars. Now he is a multi-millionaire and agitates others to believe in this cryptocurrency. He is called the Jesus of Bitcoin, as his belief in the power of the currency is close to religious. There are many such people - millionaires, entrepreneurs, stockbrokers. The distribution of gold coins in the world is not carried out by a financial, but by a public organization - the Bitcoin Fundation, registered in the United States and one of the most influential. He also advises the legislatures of world powers.

“Someday 1 Bitcoin could be worth hundreds of thousands, maybe a million dollars,” says Werr, and encourages everyone to join the movement.

For many, the collapse of the MtGox exchange was a huge shock. The exchange worked in the USA, although it was officially registered in Japan. Thousands of people kept their savings in Bitcoins on it, since it was the largest in the world (almost half of all transactions with BTC were carried out through it), but in February 2014 its website became unavailable. According to the developers, due to a bug found in the program, hackers stole more than 750 thousand BTC (half a billion dollars at the exchange rate of that time). Then 127 thousand people went bankrupt.

But the vulnerability was found not in Bitcoins, which are almost impossible to counterfeit, but in the very structure of the exchange. After the incident, there were rumors that the organizers themselves profited from what had happened. Well, no money in the world is 100% safe from theft.

Surprisingly, it is in the United States, against the financial system of which Bitcoin is fighting, that this currency has become most widespread. Specialized exchanges appeared, the installation of bitcoin terminals began, exchanging bitcoins for dollars and vice versa. Some are already even paid wages in BTC.

Many world-famous companies have begun to accept this cryptocurrency as payment for their goods or services, for example, Lamborghini, Microsoft, Skycraft Airlines, etc.

Also, in some countries, you can rent or buy housing for Bitcoins, buy air tickets, equipment, luxury goods, and even get an education. It is convenient to donate them to charity.

In Russia and on the territory of the countries of the former USSR, you can use BTC to make purchases on Amazon, Ebay, purchase applications on the App Store, pay on various websites and online stores, and even get legal advice. For this cryptocurrency, you can buy tickets for various entertainment events, such as cinema, theater, concerts, etc. It is accepted by some advanced shops and cafes, flower delivery services, and even taxi services. But of course, so far in our country these are all special cases and rather exceptions to the rules that only some organizations implement, following the fashion trend, in order to stand out from the competition. And we are not talking about such mass prevalence as in the USA, Japan and Western Europe.

In many countries of the world, the authorities do not treat cryptocurrency very well, since it is independent in its essence. And this is inconvenient for power structures, which are used to keeping everything under their control. It is believed that such means of payment contribute to the shadow economy, and digital income cannot be foreclosed.

In Russia, the government does not approve of the use of cryptocurrencies, believing that it can facilitate the laundering of proceeds from crime, as well as the financing of terrorists. But so far there is no law either allowing or directly prohibiting the circulation of Bitcoins.

The uncertain status of digital money in most countries of the world, which have not yet decided how to regulate their circulation, somewhat slows down investors, making them doubt. But despite this, people with a firm intention to get Bitcoins can no longer be stopped.

The anonymity of the system can play a cruel joke on society, as it provides ample opportunities for everyone indiscriminately, including the underworld. There is an example of an illegal Silk Road online store in the United States that sells drugs and uses the anonymous Internet network Tor, which is not indexed in search engines, but the Bitcoin network for payment. He traded in psychotropic substances: LSD, marijuana, heroin, as well as pornography and other illegal goods. The FBI seized his accounts, which contained about 30,000 BTC, equal to $25 million.

Another criminal project acted in the same way, which offered visitors to “throw in” money, and specifically Bitcoins, to order killers to kill various famous political figures. Through this site, performers could accept an order and receive their reward for its execution, and the creators of this resource could receive a commission from this amount.

In addition to the well-known individual mining, where you rely only on yourself and your own equipment, there are 2 more ways to get crypto:

1. Pools for mining. Since it is very difficult to carry out successful mining alone, especially if you are a beginner, you can join interest groups, the so-called pools. You can connect your PC to a data center (pool) and make sure that by working together to find new blocks is much faster and more efficient, although the earned reward will have to be divided among all participants in the process.
2. cloud mining. The idea is to increase the speed of mining for a certain amount and for a certain period of time, in return for receiving Bitcoins mined on a cloud server. The advantages of this method are that it is not necessary to control the process of mining cryptocoins, to incur costs for the use of electricity and equipment.

Where can you buy Bitcoin:

• large and small exchanges;
• private Internet exchangers, usually offering small amounts with a minimum percentage;
• ordinary users, familiar or unfamiliar, met on the Internet;
• special bots in messengers;
• if you have your own website or online store, you provide any paid services or sell goods, you can start accepting payment for your activities in cryptocurrency as well, by indicating your bitcoin wallet in promotional materials, or the QR code that is there created;
• you can also win BTC coins in the casino, or bet on various competitions, thereby increasing your capital.

It is difficult to do, because the situation can change in the most radical way: today everyone is a fan of Bitcoin, and tomorrow they have invented some more advanced, technologically advanced and convenient tool, and investors have fled there. Now there are so many bright minds of programmers, mathematicians and analysts in this field that technological leaps are simply inevitable. But whether the next stage of development will benefit Bitcoin or not remains a mystery.

Predicting the growth of the exchange rate for the coming years, analysts conditionally divided into 2 main camps:

1. Skeptics believe that the cost of Bitcoin is artificially inflated to incredible limits, and this "soap bubble" will burst sooner or later. They are also confident that the growth of the token will at least stop, and soon its value will begin to fall. Their main argument is that the authorities of most countries are against the legalization of cryptocurrencies. Another argument "against" is that if the crypt is stolen or lost, no one will compensate your losses. Therefore, it is necessary to raise the issue of improving the security of electronic wallets.
2. Optimists who firmly believe that the growth of Bitcoin can have no limits, and fuel this belief and the entire population. They prophesy figures up to 200 thousand dollars per 1 BTC, and consider this not a fantasy, but a very real prospect that can come true in some ten years. The main thing is that this crypt is not moved by competitors.

You can also highlight the position of realists, who are not so subject to general insanity, but also are not hardened conservatives in financial matters. More or less adequate forecasts indicate that the exchange rate at the beginning of 2018 will be around $10,000. It is possible that it will not take off as rapidly as before, but sharp collapses of gold coins are not expected either. The capitalization of Bitcoin will be comparable to the strongest national currencies. And here the fight will begin not for life, but for the death of traditional currencies with cryptocurrencies, as world domination will be at stake.

On the Internet and even on television, you can increasingly hear about the no longer a new virtual cryptocurrency - bitcoin(bitcoins). At the moment, there is much more information about it than back in 2013-2016. But still, few people know about it.

The popularity of Bitcoin is rapidly gaining momentum. Even states have already begun to express their opinions about Bitcoin. The world-famous Chicago exchange opened trading on Bitcoin futures on December 18, 2017, which says a lot. In this article, I will tell you in simple terms what bitcoin is, how you can buy it, earn it, and other introductory questions. Let's start with a definition.

1. Cryptocurrency Bitcoin - what is it in simple words

bitcoin("Bitcoin" from the English words "Bit" - bit, "Coin" - coin) is the world's first cryptocurrency using the digital currency of the same name using P2P technology

Bitcoin sticker - BTC (colloquially "cue ball"). In the future, the option of renaming to "XBT" is being considered. The mark has been approved for inclusion in the planned Unicode Standard Version 9.0. His number is U+20BF.

If you read the definition on Wikipedia, then there it is quite complicated. It is unlikely that an ordinary user will be able to understand this wording, not to mention all the subtleties. From Wikipedia: "Bitcoin is a peer-to-peer electronic cash system that uses the digital currency of the same name, often referred to as a cryptocurrency or virtual currency."

In simple words, what is Bitcoin

bitcoin- the world's first virtual decentralized currency that does not belong to anyone and is not subject to power. She can pay for purchases. This money exists only on the network, but it can be easily exchanged for the money we are used to (rubles, dollars, euros)

The main "trick" of Bitcoin is that it is both a currency and a payment system. And this means that there is no need to pay intermediaries a commission for transferring money between wallets.

1.1. Who Created Bitcoin

Its creator and developer is Japanese Satoshi Nakamoto, who in 2008-2009 first told the world about Blockchain-based cryptocurrency (see the history of Bitcoin). No information about Satoshi's identity has been found online, so everyone assumes that he is just a legend. Most likely, this is just the name of a group of programmers (as in Yandex there is Platon Schukin, who does not actually exist).

The main feature of Bitcoins is the absence of a central network administrator, which means that this currency is completely decentralized. A sent transfer cannot be returned in any way - therefore, an error in the sending addresses is unacceptable.

All payments here are absolutely anonymous. There is a common database of all transactions made using Blockchain technology (block chain), where in the public domain you can see from which wallet and where the funds went. However, this is where the available information ends. No one knows who owns the wallet and where it is located geographically.

Due to the fact that each transaction in the Blockchain network must be confirmed by other network participants, it is impossible to fake any transfer in Bitcoins. In order for the money to really reach from one address to another, you need network confirmation. It is impossible to fake a transfer, unless you have such a powerful computer that has a capacity exceeding 50% of the entire network, and these are millions of computers around the world.

1.3. What is Bitcoin also called?

Users also refer to Bitcoin by the following synonyms:

• Cryptocurrency
• cue ball
• Virtual currency
• Digital currency
• Electronic cash
• virtual gold
• Bitcoin (BTC)
• bitcoin

2. Creation of new Bitcoin coins

Many beginners ask: "If no one prints and releases Bitcoin, then where do they come from?" Any cryptocurrency is created in the process of complex mathematical calculations of guessing "hashes". This process is called "mining". Bitcoin uses the SHA-256 algorithm. Let's talk more about this process.

2.1. What is bitcoin mining

Bitcoins can be mined and even made money, but it will not always be profitable. The mining process is called mining. Thanks to it, transactions take place on the network, and thanks to its huge power, it cannot be hacked.

Mining alone is a pointless undertaking, since only one computer receives a reward. And since the competition is super high, the chances that it will be your PC are very low. It's like a chance to win the lottery.

They found a way out: miners unite in huge groups through special sites - pools and engage in joint mining. Together, getting a block is much more likely. The reward is divided among all participants in proportion to its investment.

Taking into account the great competition and the growing complexity of production, it is becoming more and more problematic to make money. Fortunately, the growth of the Bitcoin exchange rate fully compensates for this.

The more coins are issued, the more difficult it is to create new ones. But still, due to the growth of the Bitcoin price, there are still chances of earning. When they first began to appear, it was a thousand times easier to mine them due to their lower complexity. The amount of the reward for creating a new block chain was 25 BTC, since the summer of 2016 it has been 12.5 BTC. In 2020 there will be 6.25 BTC.

2.2. How to start mining

As we said a little higher, any cryptocurrency is mined in the process of mining. Anyone can participate in this. All you need is a computer and the Internet.

Since the complexity of mining has grown very much, it is ineffective to fight large farms for cloud mining on a home PC. Plus, you also need to monitor the extraction process.

Since 2014, special sites for renting computing power have become very popular. On them you can buy Hashrate for rent at wholesale prices and mine cryptocurrency. Stable income and payments on demand. Here is a list of the best sites:

These are not HYIPs, but large portals that have real offices and real equipment in different parts of the world. These companies speak at cryptocurrency conferences.

3. Emission of Bitcoin - 21 million coins

In total, exactly 21,000,000 Bitcoins can be issued and not one more. This is a strict limit, to which their number will gradually tend. At the beginning of 2014, there are about 12,000,000 BTC, at the beginning of 2017 - 16,000,000, in May 2018: 17,000,000. Moreover, the creation process is known and even a curve is built, by which you can determine the date of creation of the very last coin:

It may seem that 21 million is very small for the whole world. However, there is a way out. The fact is that Bitcoin is divided into smaller units - Satoshi. 1 Satoshi = 0.00000001 BTC. Thanks to this, you can send arbitrarily small amounts of cryptocurrency.

Despite the fact that the number of cryptocurrencies is becoming more and more every day, but their rate towards real money has been going up quite sharply lately:

The cost of one Bitcoin reached $ 1200 in December 2013, and in the summer of 2013 the currency cost 100 times cheaper. This is a colossal growth, on which you could earn 10,000%.

For the summer of 2017, the Bitcoin exchange rate is over $4,000. On September 1, 2017, the absolute maximum was set at $5,000. In October 2017, the cost has already approached $6000, in November already $9700, in December $19500.

4.2. How to buy / receive Bitcoin for a simple user

If you want to accumulate or receive Bitcoin for some purpose, then the easiest way to do this is through exchangers. Below is a list of reliable and with an acceptable exchange rate:

Choose the exchanger that suits you and buy Bitcoin for rubles or dollars. Most often it is bought for Yandex Money, Qiwi, by transfer with a Sberbank card.

4.3. Bitcoin Transfer Fees

The commission for sending Bitcoin is calculated individually each time. Usually it does not exceed 50-250 rubles for any amount you send (in January 2018 there was a "boom" in transactions, so they went up a lot, but then everything returned to typical values). When sending large amounts, such a meager commission can generally be ignored. Commission-free transfers are also possible, but their transaction confirmation priority will be lower, so their confirmation time may greatly increase.

5. Pros of Bitcoin Cryptocurrency

1. Bitcoin anonymity

Since the network is decentralized, all transfers are completely anonymous. Wallet addresses are also anonymous. You can only track the latest transactions, but it is impossible to determine to whom and for what the Bitcoins were transferred even to the special services. However, this plus has an opposite minus, which will be described in the cons section just below.

2. Bitcoin is an alternative to existing money

Bitcoin is an alternative and quite convenient payment method in the world. Now there are already many places, both on the Internet and in real life, that accept Bitcoins for payment. See Where Bitcoins Are Accepted.

In the very center of the city of Vienna (the capital of Austria) there is already a Bitcoin Store (Bitcoin store).

3. No taxes

When paying with Bitcoin, there are no taxes, since it is not officially a currency. This makes it possible to purchase goods a little cheaper.

4. International currency

Bitcoin is truly an international currency. For example, it is possible both in Russia and in other countries to pay for everything from one wallet without thinking about currency exchange.

5. Lack of control

Bitcoin is not controlled by anyone. They belong only to the public, which means that it is difficult to influence them politically. Although, of course, it is impossible to talk about a complete lack of control.

6. Minimum fees

The minimum commission for the transfer (moreover, it does not depend on the amount). However, if the transfer needs to be done instantly, you will have to pay a commission that you yourself decide to pay (the more you pay, the faster the transfer will be).

7. Reliability of Bitcoin

Bitcoin cannot be counterfeited because it is very difficult. Much easier to get new coins. For all the time of the existence of the network, it has never been hacked.

8. Limited edition issue

There will definitely not be more than 21 million Bitcoins. This limits inflation and makes money more valuable.

9. Transparency of transfers

You can track all transfers through the official blockchain website (blockchain.info). All consecutive chains of blocks are stored here. So, if you send funds from one wallet to another, then this transfer can be tracked on the blockchain.

10. Transaction speed

The speed of Bitcoin transfers is very fast (10-30 minutes). In real life, it can take three business days to transfer money from one account to another, plus you depend on third-party banks and still pay a commission.

6. Disadvantages of Bitcoin

1. Big risks

The new virtual currency is not backed by anything other than user demand. If interest falls, then the price for it will also go down like a stone. In other matters, the problem with security is inherent not only to Bitcoins, all other cryptocurrencies are also not backed by anything.

Note

Now all the currencies in the world are not backed by anything (let me remind you that they were previously backed by gold).

2. So far outside the law

There is a danger that countries will not legalize this currency, and this will greatly undermine interest in it, and many may refuse to use it.

3. You have to take care of security yourself

Lack of proper security against theft in the Bitcoin cryptocurrency, losses and other risks. Since all this is not official yet, there is a risk of being deceived by some exchange system. Also, do not forget about the threats from viruses that can steal access to the wallet, etc. And it will be unrealistic to return the money, because. the laws currently do not provide for the return of virtual money.

4. Illegality

Due to the lack of control and the anonymity of payments, terrorists can easily use it, pay for drugs, etc. This creates a big problem in the legalization of Bitcoins and so far this problem has not been solved in any way.

5. Strong fluctuations in the exchange rate

Strong fluctuations in the Bitcoin exchange rate scare away many who want to buy it. For example, now 1 BTC costs $15,000, next week $20,000, and after the next week $12,000, etc. In short, price is strongly driven by demand, which is known to be highly volatile and speculative. And at the moment, due to the lack of high turnover on Bitcoin exchanges, they are easier to manipulate, so we are seeing extremely high volatility. But with the development of the market, sharp jumps will become less and less.

But this attracted a large number of traders who began to earn on trading cryptocurrencies.

6. Alternative cryptocurrencies

Over time, there is a risk that Bitcoin will become less relevant due to the flight to some other more promising currency. For example, Dash, Cardano, Nano, Iota or Ethereum. Of course, everyone will not switch to another currency, but the risk of losing relevance always exists.

Although another opinion believes that Bitcoin will never lose its relevance due to the fact that it will always be considered a "benchmark" in the crypto world.

I also advise you to watch the following video about what Bitcoin is:

In the age of electronic transactions, the emergence of cryptocurrency has become a breakthrough in the global market. You can use bitcoin - what is it in simple understandable words, experts will easily explain. How to buy it, why do we need such electronic money? Cryptocurrency serves as a commission-free, anonymous alternative to official, resource-backed currencies. It is possible to buy btc on specialized exchanges, but to spend it is far from everywhere: due to anonymity, cryptocurrency is a priori considered illegal by many countries.

What is bitcoin

A decentralized currency that is not controlled by any bank or exchange has always been the nightmare of the global financial system. It is scattered around the globe, works only online, is not backed by anything, and every user in the world is able to influence the course without leaving the computer. At the same time, the computing function of the server grows, which in the system can look like a continuous operation. Bitcoin - what it is in simple words can be described as follows: calculations of a mathematical nature generate a mining process into a small part of computer code.

Who came up with

The first developer of unique complex mathematical cryptocurrencies was Satoshi Nakamoto in 2006. Two years later, cryptographic documents were sent to them, which for the first time in history described what bitcoin was. Later, in 2009, Satoshi Nakamoto created the first client software that allows you to control the operation of the cryptocurrency, the speed of creating blocks. Who invented bitcoin and its icon is still unknown, because. under the pseudonym Satoshi, a man worked whose real data remained a secret.

What do you need

Bitcoin - what it is in simple words cannot be explained without asking the question why it is needed and how the cryptocurrency works. The main advantage of an electronic tool for storing money is the absence of a commission or its insignificant amount. Bitcoin is necessary for people who want to achieve 100% efficiency of their business, exchange of electronic coins anywhere in the world. Commission-free transfers, complete anonymity, protection of the recipient's and sender's money from government interference - these are the advantages and features of bitcoin and the use of another cryptocurrency.

Specifications of bitcoin

Bitcoin is a unit of information, a specific piece of computer code, expressed in mathematical calculations of computer power. The peculiarity of bitcoin is that it is an independent digital unit, which is not affected by other currencies and payment systems, the bitcoin economy is completely independent. One bitcoin (1 btc) has certain technical characteristics:

• formation of an information block: every 10 minutes;
• block reward: 25 coins;
• number of bitcoins in the world: 21 million;
• the complexity of the structure changes: after 2016 blocks (2 weeks).

Open source code

The development and commissioning of cryptocurrencies is carried out with an open source code. This means that changes to the structure of bitcoin can be made by the majority of users. In addition, open source code allows any user of a personal computer to start mining, “mining”, electronic money. This approach to the development of bitcoin instantly eliminates errors in the system, helps to rapidly develop the exchange network and mine bitcoin.

Blockchain technology

A chain of blocks containing information and built according to a certain scheme is called a blockchain. Such a chain of blocks grows and performs the function of distribution, database classification. It is necessary for conducting transactions, exchange operations with bitcoin cryptocurrency. Blocks are formed at the same time by many “miners”, after which they go to a special database (blockchain). Blocks contain all information about transactions, owners of cryptocurrency. The number of bitcoins does not affect the speed of formation of block branches.

Protecting transactions with electronic signatures

Bitcoin electronic signature - what is it in simple understandable words: a password assigned to a new account. When registering in the bitcoin network, all users are given unique signature keys. Only with their help it is possible to carry out a transaction from your account. In addition, it is possible to create a joint account of several people with a multi-signature. To transfer currency from it, the introduction of personal identifiers of at least two-thirds of the account holders will be required.

Where do bitcoins come from

An unsupported cryptocurrency appears by the efforts of users using it, allocating computing power to process all transactions. Bitcoin mining - what is it in simple reasonable words, how does an electronic cryptocurrency appear? Bitcoin does not have a transaction processing center, so users take on the task of providing computing processes. For spending the resource of their computer, they receive a strictly defined amount of btc. In total, up to 3600 units of currency can appear per day.

Who is issuing

The emission of bitcoin is clearly limited, limited, it is possible to intervene in this process only by leasing the computing power of your computer to the system. The people who do this are called miners, and for their services they receive a limited daily supply of bitcoins. Such an occupation is currently beneficial only to the owners of large firms, members of large pools. Smaller farms are already struggling to cope with the tasks presented to them by the bitcoin system.

How many bitcoins are there in the world

A currency that is not backed by traditional resources and is capable of self-reproduction through the execution of certain programs on the computers of network users will instantly depreciate. To prevent this, an artificial limit has been created that prevents the number of bitcoins in the world from becoming more than 21 million. All these millions are financial transactions on the network that are reliably provided with computer power. At the moment, 14 million have been mined. Due to the constant complication of the mining algorithm, the emission of the last bitcoin is expected in 2140.

What is the bitcoin cryptocurrency

Bitcoin - what it is in simple words, can be described as a sophisticated version of the nascent economy of a country with undeveloped gold mining. An unextracted resource is worth nothing, except for the promises of a person to buy it in the future. The use of cryptocurrency is based on the same principle: it appears due to demand, which gives birth to itself. The cost of bitcoin is determined by people's trust in the system, the willingness to conduct transactions with its help, which causes a financial pyramid or bubble, and this is a negative feature of bitcoin.

The difference between bitcoin and money

Electronic cryptocurrency has a number of striking differences from the usual cash and other valuable financial assets. Bitcoins have the following differences:

1. Decentralization. There is no central network control authority, it is distributed to all computers used for computing resources and mining bitcoins. The decentralized system uses a special program code that regulates the work of network participants and the emission schedule.
2. Irreversibility of transactions. After the cryptocurrency is transferred from one addressee to one of the online wallets to another (for example, webmoney), it cannot be returned to the original account.
3. Emission limitation. Mathematical algorithms are built in such a way that the generation of coins is closed. The total number of bitcoins will never change.
4. No or low transfer fees. A feature of bitcoin is the absence of any intermediaries in the transaction, due to which no commission is charged. A small percentage of the commission may be for transactions with bank accounts.
5. Does inflation affect the exchange rate? World inflation is isolated from the financial economy, so inflation does not have any impact on the exchange rate, unlike conventional currencies.

Bitcoin electronic money - advantages and disadvantages

Like any financial system, bitcoins have their advantages and disadvantages when using, mining, and forming an exchange rate with other monetary currencies. Among the advantages are:

• simple and clear use;
• ease of extraction;
• anonymity;
• decentralization;
• no commission.

The disadvantages are the following characteristics:

• transparency;
• irreversibility of transactions.

Ease and availability of use

The growing popularity of cryptocurrency is due to the ease of use of bitcoin services. Any computer owner can earn bitcoins in several ways. The electronic currency bitcoin uses the user's equipment for special services for volumetric information processing. Millions of computers registered on the network contribute to the increase in system performance, while users are rewarded at a favorable rate.

Complete anonymity

All cryptocurrency systems are completely anonymous. For transactions, purchases and investments, they do not require any passport data from the user, only the e-wallet data is enough. The user can call an infinite number of addresses and wallets without linking personal data. However, each transaction must be registered under a specific number and stored in the database.

Transparency of operations

The system of information blocks saves all operations performed on electronic bitcoin accounts. The main lack of transparency of operations is publicity. Anyone can study all the transactions carried out on a specific account. To ensure complete anonymity, it is necessary to open a new wallet or account even for a single transaction.

Where to get bitcoins

There are several ways to acquire ownership of bitcoins. However, the process can be fraught with some difficulties. For example, there are a large number of fraudulent sites listing fake bitcoins. You can detect fake e-currency only when you try to spend it.

There are practically no ways to get completely free bitcoin. After the rapid growth of the cryptocurrency exchange rate, such services for receiving free electronic coins ceased to exist. To receive bitcoins by any method, the cost of certain resources is required. The main ways to get bitcoins:

1. Cranes. One of the easiest ways to get bitcoin. The user of the service only needs to click on advertising banners and videos, but the cost of the transition is very low.
2. Mining. Those who are engaged in mining rent out video cards to receive cryptocurrency by using the computing power of a computer. There are many bitcoin mass mining farms.
3. Jobs paid for with bitcoin. There are special exchanges that offer jobs paid for with bitcoins. After completing a small task, the employer transfers the electronic currency to the contractor's wallet.
4. Haircut coupons. You can make big profits by lending bitcoins to other users. However, it should be remembered that after transferring the currency to the addressee, it is impossible to recall it back in case of fraud.
5. Buying a cryptocurrency. You can buy electronic currency for money on bitcoin exchanges at favorable exchange rates.

What are bitcoin faucets

Any specialized distributors of bitcoin to visitors of the resource, existing mainly by selling advertising space on the site, are called bitcoin faucets. Entrance to such resources is free, but requires mandatory registration in a simplified form: entering an email address and wallet number. Faucets work as follows: the owner places advertisements, and visitors go to the advertiser's website by clicking on the advertisement. At the same time, they are transferred electronic currency (1 satoshi - a conditional penny bitcoin).

The more clicks on different advertisements - the more "dripping" virtual coins. An additional condition for some resources is the presence of the user on the site for some time (from one to five minutes). In addition, the number of paid transitions to the same site for one user can be limited relative to the time interval (for example, once an hour or a day), so bitcoins are mined very slowly.

How does bitcoin work - cryptocurrency mining

The number of bitcoins in the world and the daily issue is strictly limited to 21 million, 3600 units. Mining bitcoin - what it is in simple words, it is easy to explain. In order to generate and make calculations for these 3600 units of cryptocurrency, servers send special mathematical problems to the computers of users involved in mining, the solution of which consumes a significant resource of processor and video card power - this process is called mining.

For solving these problems, bitcoin is charged, and it works with the help of cryptocurrency symbols. The more it is in the world, the more difficult it is to achieve the task. The complexity of mining lies in the fact that even now the calculations of the mathematical capacities of the machine can hardly cope with the development of bitcoin, so this way of earning is unprofitable for the creators.

Online wallet

In order for the user to be credited with the Bitcoin currency, it is necessary to register the wallet. The main function of an electronic bitcoin wallet is to store an individual secret key used to access the address where the cryptocurrency is stored. Transactions are processed only when the key is provided. There are wallets for computers and smartphones in the form of an application. Technically, they are the same, they work according to the same algorithms, but they are “sharpened” for the use by wallet owners of a specific device with specific software.

What can you buy with bitcoins

The use of cryptocurrency in Russia is almost not developed. Bitcoins can be spent or exchanged for airline tickets of some companies (for example, AirBaltic), food in restaurants and cafes. On the world market, yachts, cars of some companies (Tesla), real estate are sold for bitcoins. The main problem of buying for e-currency is the small number of trading platforms that accept bitcoins and other cryptocurrencies. Banks allow the exchange of electronic currency for dollars, euros or other real currencies. The possibility and conditions of such a transfer or exchange must be clarified with specific banks.

Abroad, investing, investing your own money in cryptocurrencies is gaining popularity. Due to the fact that the Internet currency bitcoin is generally independent of the global economy, inflation does not affect it, and the funds retain their purchasing power without the risk of huge losses in the transaction chain. The negative features of bitcoin are the instability of the global systems of the cryptocurrency exchange, the impossibility of making money transfers in the bitcoin currency.

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