Frequently Asked Questions on Investing in Bitcoin
Sep 09, 2020 12:34
As the value of Bitcoin continues to rise, people become more curious and interested in trying this new system of money every day. The relevance of cryptocurrencies becomes clearer for many as time passes. However, for regular consumers, Bitcoin and cryptocurrencies are still unclear concepts for them. Lack of knowledge on these is what causes people not to invest at all, but you may want to know more about it before you say no. Here are some of the frequently asked questions about Bitcoin:
What is Bitcoin?
Bitcoin is a form of digital currency functioning as digital money. People invest in it because of the attributes which can only be found in cryptocurrencies like Bitcoin. Being decentralized is one of these characteristics that provide a great advantage to many. This means it is not regulated by any authority or by a single company. Because of this, Bitcoin is protected from any kind of inflation. Governments have a lack of control, if not none at all, in the transactions and the supply of Bitcoin. Also, Bitcoin is for everyone. Anyone can buy and sell Bitcoin. The value it has accumulated over the years is currently around $11,800 per 1 Bitcoin.
How does it work?
For users, it is as simple as using computer software or mobile applications. To start investing in Bitcoin you are provided with a wallet that is stored in your computer or the cloud. Your wallet ID is what you use in your transactions while a private key that comes with your wallet is what you use to confirm or verify transactions.
However, the technology behind Bitcoin is a complex system of blockchain technology where it employs peer-to-peer networking. Bitcoin miners corroborate with each other in the verification of transactions, thus making Bitcoin secure from fraudulent attempts. The blockchain is a public ledger that contains a record of all the transactions that ever existed. Each block has its history of transactions, and every block is stored in the blockchain.
Can it be used?
Bitcoin was designed as payment for goods and services. Some companies are now starting to accept bitcoins like airlines, Microsoft, Dell, and others. Some hotels also accept bitcoins for reservations, but one of the easiest ways to use it for payment is to convert them into gift certificates that are accepted in Amazon, Walmart, and Target.
Can Bitcoin be exchanged for money?
With recent developments, users can now convert Bitcoin into cash and withdraw them through the newest crypto debit cards. These cards can be used in ATMs to withdraw from Bitcoin funds.
Where can I buy Bitcoin?
There are different available sources where you can buy Bitcoin. It can be done online or offline through brokerage services and exchanges. You can use fiat currencies to purchase them through bank transfers. Some brokers even allow purchasing Bitcoin using Paypal. Bitcoin Teller Machines are also starting to be set up in different locations. Moreover, mobile apps and websites are also available for your convenience like the Bitcoin Bank app where it serves as a cryptocurrency trading platform.
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