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What Is The Deal With Bitcoin?

Bitcoin Profit - Opening Up A Bitcoin Wallet

Published days ago on July 31, 2020
By Anton Kovačić

Bitcoin is the flashiest word in currencies right now. Everyone is throwing around the concept of Bitcoin, but there are few who seem to have a full grasp on what it really means or why everyone is so excited about it. This is why it is best to try to get some grasp on the concept before diving headfirst into it. That being said, you don't have to understand every detail to get started, and most people don't.

Opening Up A Bitcoin Wallet

To participate in the ownership of Bitcoin one must first open up a Bitcoin wallet. Think of this as a storage space for your digital currency. Your real-life wallet holds fiat currency and credit cards, and your Bitcoin wallet holds your digital currency. The wallet will be completely unique to you and protected from someone else getting into it.

You will receive a Bitcoin address that you are welcomed to share with your friends or businesses that you interact with that you need to trade Bitcoins with. The address itself is not an important part of the security, the encryption is what keeps you safe.

What Is The Blockchain?

The next big term you are likely to hear about in the world of Bitcoin is known as the "blockchain". If you have confusion spreading across your face at the mere mention of this term, don't worry we will explain. The blockchain is an integral part of how Bitcoin works. It is a massive public ledger of all transactions that take place with Bitcoin throughout the world. The parties that are part of the transaction itself are kept anonymous, but the amount transferred can be seen. This keeps the cryptocurrency transparent where all can see and avoids the need for a central governing authority to step in to control it.

It is a clever way to keep the balances of all Bitcoin wallets accurate at all times as well. This makes it easier for Bitcoin to be transferred back and forth at will as necessary. It makes for a more open community and promotes accuracy in accounting at the same time.

Transactions-Private Keys

One does not just purchase Bitcoin to say that they have it, they buy it to make purchases with vendors that accept Bitcoin as a legal form of payment. Thus, we need to know how these transactions work between multiple parties.

Every Bitcoin wallet has a secret piece of data in it that is used to verify that a transaction is actually being requested by the legitimate owner of the Bitcoin wallet. The data is known as a private key, and it is a way to prove mathematically that the true owner of the Bitcoin wallet is the one who agreed to the transaction in the first place. That is huge because he or she has full faith that no one else can access their stockpile of Bitcoin, and that is essential to a functioning currency.

All transactions are instantly broadcast out to the blockchain network, and they are usually fully confirmed within ten to twenty minutes or less. There is no altering of the transaction once it has been made.

Mining Bitcoins

The process used to confirm transactions is known as Bitcoin mining. This is a process by which very complex math problems are worked out by computers to figure out the exact order of the blockchain and confirm that pending transactions have gone through. Those who do the Bitcoin mining are often rewarded with a small amount of Bitcoin themselves for the effort. They often have to hook up a variety of high-powered computers together to solve the math problems at this point, so you know that it is labor-intensive to do the mining, and it is meant to be that way. It keeps everyone safe and maintains the accuracy of the blockchain.

There is always competition to be the next person solving the next transaction for the blockchain, so there is no central control over how the blockchain runs, and that is in the spirit of how the blockchain is supposed to work. It is in everyone's interest who owns or transacts in Bitcoin to keep it as safe as possible through methods like this.

It Continues To Get More Complex

These ideas are the most straightforward explanation of some pretty complex ideas and concepts. Bitcoin is a constantly changing eco-system that continues to grow in power and influence as more people understand its value and want to be a part of it. There are more transactions taking place via Bitcoin than ever before, and that doesn't appear likely to slow down at any point in the near future. The simple truth is that people want to be able to transact without a central authority.

The Benefits Of Bitcoin

As already alluded to, Bitcoin has a lot of benefits to it. It is a completely anonymous way to transact with other people or other entities. It is also a great choice for those who want to speculate in the Bitcoin markets. The value of Bitcoins is determined by traders every day. That value has been on the rise in recent years, and there are some people who have made significant amounts of money trading Bitcoins. It may not be the worst thing in the world to buy at least a few of them to hold onto in the hopes of seeing them rise in value in the future.

The Future Of Bitcoin

No one who tells you they know the exact future for Bitcoin is telling you the truth. At best, they are probably offering you their personal viewpoint on what they think may happen with the cryptocurrency, but they simply do not have the ability to predict the future and tell you with certainty how it is going to go. That all being said, there are some things to look at for:

Government Regulations

The first newsworthy thing to keep an eye on is how governments will work on regulating this currency. Some have very much embraced the cryptocurrency while others have been highly resistant to it. Countries like the United States and Canada have largely given the green light to Bitcoin while others like Russia and China have outright banned the currency.

It will be fascinating to see how world governments continue to attempt to adapt to this new age of digital currencies and which side will ultimately win out. The smart money is on governments moving more towards acceptance as people want to use these currencies.

Online Gaming/Casinos

Expect to see an explosion in use of Bitcoin and other cryptocurrencies on online gaming and casino websites. It is already a popular option with many online casino players, and it is expected that this trend will continue. The reason is that Bitcoin is an anonymous currency and it offers a lot of other benefits to playing online as well. Many casinos are pushing their players towards using Bitcoin rather than fiat currencies, so you may see that trend continue.

Bitcoin In The Physical World

One final reason why Bitcoin may continue to grow off the charts is that it is starting to encroach on our physical world more and more. It used to be a digital-only currency that only people in the know had any idea existed. Now, it is starting to appear in places like ATMs in malls and small stores as well. It is being accepted by some major retailers as a form of payment, and more. As people see it more in their physical world they may come to accept it and appreciate it more and also take a great understanding of what it really is along with them.

These are just a few of the things to watch for related to Bitcoin. There are sure to be many more that come up in the future, but for the time being we should at least make sure to keep an eye on how these developments change the course of the world we live in.

What Is The Deal With Bitcoin?