on the crypto
Everyone talks about it and everyone knows them, but we're really sure we know how Bitcoins work? Let's be clear in this guide dedicated to how Bitcoins work, but first it is good to clarify once and for all what they are.
Bitcoin: what are they?
Before understanding in detail how Bitcoins work, it is essential to examine in depth what they are.
Bitcoins are digital assets or cryptocurrencies or a payment system completely digital.
Unlike FIAT currencies (euro or dollar to understand), Bitcoins are the first P2P decentralized network, which appears to be completely managed by the nodes, or by the users who are part of the network, without the intervention of any central bank or Authority.
Therefore, to understand how Bitcoins work, it is good to know that these assets are digital and circulate only online.
The operation of Bitcoins is based on the use of cryptography which allows you to check its creation and transactions.
Bitcoins are controlled by all users around the world, who can choose which software and version to use and in any case the information within the blockchain will always be available for consultation.
Bitcoins work properly only with a complete consent by both all users of the Crypto Community and the developers.
How do Bitcoins work?
Bitcoins, as well as a virtual asset, work like application for smartphones or tablet or like PC program
But, to understand exactly how Bitcoins work, it is necessary to consider that "behind the scenes" has been implemented blockchain technology, or a public archive containing all processed transactions.
Thanks to the Blockchain or the chain of blocks, it is possible to verify the validity of each transaction.
Moreover, thanks to encryption and digital signatures, theauthenticity of each transaction: this allows all users to have full control over the funds sent by their personal accounts.
No one has ever managed to hack the blockchain.
How Bitcoins work: the advantages
Once you understand how Bitcoins work exactly, you also need to expose the benefits that the Crypto Community can benefit from.
Choose commissions
There are no commissions to receive Bitcoins, and many Wallets leave the user control over the amount of commissions to use when making a transaction. Furthermore, several payment managers allow Bitcoins to be converted into Fiat currency and to deposit funds directly into bank accounts.
These are financial services that can be offered to low costs, certainly more competitive than those applied by Visa and Mastercard and credit cards Paypal (perhaps between 10 years Bitcoin will replace Paypal).
This aspect eliminates the Banks, understood as annual fee and exorbitant fixed commissions
Freedom of payment
Thanks to the smart operation of Bitcoins, users have full control of their money. You can send and receive any amount of money instantly, anywhere in the world and at any time.
So no limits imposed by banks, no problem of availability, in a few seconds we have the amount on our wallet, not days as happens for bank transfers.
Transparent and safe
No individual or organization can control or manipulate the Bitcoin protocol because it is cryptographically secure. This guarantees its transparency and reliability.
Secure transactions
Bitcoin transactions are safe and do not contain sensitive data or personal information of the customer. This guarantees privacy, theanonymity and protects against losses caused by fraud.
How do Bitcoins not work?
Unfortunately, there are many users who are still unaware of the existence of Bitcoin or are wary of this digital asset.
Every day, more and more companies accept Bitcoins, but compared to their potential, they need to grow in order to benefit from the effects of the network.
Bitcoin software is still in beta version, with many incomplete factors: many services, factors and tools that must be developed and following the best practices to make the operation of Bitcoin even more secure and accessible to users.
To fully exploit the full potential that Bitcoins are able to offer businesses and users, it is necessary to wait for them to fully mature.
How to buy Bitcoins?
Bitcoins, as we have already pointed out, are a virtual asset and payment instrument for goods and services.
You can buy a Bitcoin from a Exchange or earn the assets through a mining.
With credit card or postpay
Many exchanges offer the possibility of paying directly by credit card:
Crypto.com (from both Android and Itune apps) very simple, enter the referal code v8tqhz5494
Bitstamp
By Bank transfer
It is possible to send a bank transfer and save a lot on commissions:
Bitstamp
Furthermore, it is possible buy Bitcoins with Paypal (for now only in America): the instantaneous Exchange Coinbase allows users to deposit FIAT currencies through PayPal to purchase listed cryptocurrencies.
Bitcoin Mining
Mining is the activity of extracting the bitcoins, it is necessary to add the blocks of the chain and validate them, it is in fact Proof of Work, where precisely every operation on the chain requires a calculation job.
We must not forget that by using the power computing of the hardware, it is possible to process accounting transactions and obtain a reward in Bitcoin thanks to the very famous Bitcoin mining with app or al online mining or using your own hardware such as antminer or graphics cards,
Where to keep Bitcoins: Bitcoin Wallet
In fact, thanks to the possibility of holding Bitcoins in a Wallet, or in an electronic wallet, it is possible to access the funds deposited and kept, as well as the possibility of sending and receiving digital coins. The Wallet can be:
1)electronic without private keys, like the one created by exchanges when we register, having no private keys, we are not the real owners of the address but the exchange or the web service.
2) electronic, or online / offline with private keys (Electrum Wallet)
3)Wallet hardware (eg Ledger) : it's the safest situation, we have private keys and the hardware is disconnected from the network, so it's hacker proof
How to make a Bitcoin payment?
I Bitcoin payments they are easier to refine than with a credit card or an ATM and certainly less unpleasant.
It is enough to be the holder of a Wallet or an electronic wallet which can be accessed from the desktop or from an electronic device (smartphone, tablet, etc.).
Entering the address of the recipient and the amount of the payment, press enter and the transaction is executed in one click.
Alternatively, you can enter the address of the payment recipient in Bitcoin by scanning the QR code.
It is easy to understand that the operation of Bitcoins is really smart and suitable for every user, regardless of their computer literacy.
Quotation and Bitcoin value
The Bitcoin has a variable value and quotation, this is based on the supply and demand that the various exchange places have, it means that today it can be worth 4000 euro and maybe in a year it can go up or down a lot.
It is not one stablecoin.
To see the value in real time you can consult the following page on the Bitcoin quotation.
Bitcoin Trading CDF
Some Trading companies have also opened to CDF products for cryptocurrencies
be careful not to confuse trading with exchange platforms with cryptocurrency trading with financial products.
