Bitcoin is digital currency that is decentralized and secure, independent of any financial institutions like banks. It can be transferred between parties through a peer-to-peer payment system where there will not be any intermediaries involved. The Bitcoin works on the blockchain technology and all confirmed transactions will be stored in blocks on this blockchain. So, every user is aware of all the transactions and there is no possibility of double-spending or stealing. This is why blockchain users can have complete faith in the system.
How to use the Bitcoin step-by-step:
Buying and selling Bitcoins can be rather easy, even if you do not really understand how the blockchain works. Bitcoins are here to stay and this shows that the blockchain technology is both secure and effective. This is why you should learn how best to use it:
- Before you can start buying or selling Bitcoins you will need a Bitcoin wallet. This stores the coins and is a key criterion for buying crypto coins. You will find different types of wallets out there with varying degrees of security. Once you have a wallet you will be provided with public and private keys to it. The public key is essentially the address to which Bitcoins are sent or from which Bitcoins are transferred, while the private key is nothing ht your password to access the wallet. So, you must keep the private keys well protected. If you plan to send small amounts an online wallet will suffice, but it is best to opt for a hardware wallet when you are keen to make larger transactions.
- Once you have created a wallet it is time to make your first Bitcoin purchase. It is possible to get Bitcoins through different methods; the easiest is through exchanges of course. You can also buy Bitcoins in-person or mine Bitcoins. For the latter however, you must invest in specialized hardware because mining demands sophisticated equipment and a huge amount of electricity. So, it is best to buy Bitcoins on a trustworthy exchange.
- When Bitcoins have been bought, you will need to secure these. This is done by keeping private keys to the wallet protected against hackers. It is unwise to keep money on the exchange because exchanges are prone to cyber attacks and hacking, as the Mt. Gox incident has proven earlier.
- The simplest way to use Bitcoins is to learn how to send or receive Bitcoins. For instance, you can try to buy Bitcoins on an exchange and then transfer these to your wallet. For receiving Bitcoins, you must share your wallet address or public keys with the sender. This address is typically a series of random numbers and letters. Many wallets have QR codes for the key making it even simpler to transfer Bitcoins securely.
- Bitcoin mainstream adoption is under way and the number of services or stores that are accepting Bitcoins has been growing by the day. To send Bitcoins, you will need to open your wallet and click on the “send” option. You must type in the amount you wish to send and the recipient’s wallet address. You should always double check to make sure all details entered are absolutely correct. Transaction records once verified and recorded cannot be tampered or changed again.