How does Bitcoin work? How to get Bitcoin?

2 min reading

Undoubtedly, bitcoin is gaining more and more popularity among the society, and this is mainly due to its growing value over the past few years. However, in order to understand its significance on the market, the question - what is it really and what characterizes it?

how does bitcoin work

What is Bitcoin?

It should start with the fact that Bitcoin is a digital currency functioning in a decentralized network. This means that it does not exist physically and its storage takes place only in electronic form. The distinguishing features of bitcoin are, above all, operational efficiency, anonymity, transaction security and decentralization. It is worth adding that the amount of bitcoins is limited. It is estimated that this limit is 21 million, and consequently the occurrence of deflation and inflation is minimized.

How does Bitcoin work?

Bitcoin operates on the basis of a decentralized P2P (peer-to-peer) network, in which there is no specific server managing and verifying transactions, and each computer has the right to authenticate and transfer data. This network is public, so transactions made in this currency are fully transparent. It should be emphasized, however, that their owners are anonymous, so it is only possible to monitor the progress of the transaction.

How much is Bitcoin worth?

Bitcoin is exposed to frequent changes of rates by up to several thousand dollars in a few days. As of May 21, 2020, the value of bitcoin is $ 9,202. The overall bitcoin market reaches $ 122 billion, but unlike these figures, Swiss scientists estimated it at around $ 24 billion using a specialized method.

How to get Bitcoins?

There are several ways to become a bitcoin owner. The first option is to buy from another user through advertisements or from trusted persons. It is also worth mentioning a bitomat that works similarly to ATMs. However, the distinguishing issue is that it is possible to exchange cryptocurrencies for cash or cash for cryptocurrency in a bitomat.

The second variant is the cryptocurrency exchange, which is one of the easiest ways to obtain bitcoin. It is worth noting that there are many of them on the market, but each of them is characterized by ease of use. To buy bitcoin on the exchange, you need to register and then verify the data. Then, to finalize the process, you need to transfer the appropriate amount of money from your bank account to the exchange for exchange on BTC.

The last, but particularly difficult way to obtain bitcoin is mining. Its level of sophistication results from the need to have special devices that are expensive, and the process itself requires a significant financial outlay in connection with the consumption of energy for mining. Consequently, this form of obtaining bitcoins is not profitable for the ordinary user, but only for organized "kicking" groups, so-called bitcoin pools.