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What is Cryptocurrency and Bitcoin? Learn the basics to bitcoin

BASICS TO CRYPTOCURRENCY

Cryptocurrency is simply a medium of value exchange, just like normal currency like Kenya shilling and United States Dollar, only that cryptocurrency is a digital currency that relies on encryption in generation, release and regulation of its use. Encryption ensures that the currency is secure, making it possible for users to send to one another WITHOUT the use of a third party like banks etc

Cryptocurrency is thus unregulated by the likes of governments and banks or other financial authorities.

The process of generation and release of cryptocurrency is known as mining, and entails the use of sophisticated and robust computers to solve mathematical, computational puzzles, with the reward being that those involved with the mining are allocated a portion of the newly created currency.

I’d wish to delve deeper and provide more details about cryptocurency as a concept and the jargon related to it, but, that is not the purpose of this post.


THE IN THING-BITCOINS (BTC)

My intention for this post is to help beginners to cryptocurrency to be able to understand basics of the currency and also be able to use it ASAP with no doubt whatsoever. For that reason, I will now dwell on bitcoin, an example of cryptocurrency, and one that has the biggest value of all cryptocurrencies and is generally accepted world over.

By the end of this post, you will be able to understand bitcoin enough to be able to use it whenever you want.


WHY YOU SHOULD LEARN ABOUT BITCOIN

The swift growth of Blockchain technology especially Cryptocurrencies is expected to give the global economy a new face in the near future. Blockchain related cryptocurrencies have created a market for alternative investments that is growing exponentially. Cryptocurrencies such as Bitcoin and Ethereum have surged in popularity, thanks to the expansion of financial technology that has powered the adoption of non-banking financial products pursued so much by the investors.

It’s wise for you to position yourself to be able to tap into this investment opportunities. Better still, you need to know about bitcoin so you can be able to use platforms that are powered by bitcoin and no other currencies whatsoever, lest you will be left out.

Would you like to trade bitcoins but you don’t know how to start? Well, this guide provides you with brief information on how you can purchase and sell Bitcoin and reap returns on your investment.

INTRODUCTION TO BITCOIN

Since its introduction over a decade ago, Bitcoin has continued to make headlines due to its massive growth in value and volatility. Bitcoin is a digital medium of exchange, but unlike the centralized fiat money, bitcoin is decentralized. The decentralized system means that there is no authority or body mandate to control cryptocurrency trade. Bitcoin functions like any other currency but the significant difference is that it’s a digital currency without a central control body.  The software programs used to control the functionality of Bitcoin cannot be modified by third parties thus ensuring maximum security for your investment.

IS BITCOIN SAFE?

Bitcoin operating system is based on a cryptographic technique that secure transactions between members. The cryptographic technique is integrated with inbuilt algorithms to determine the number of transactions that should be active at any given time to ensure that there is no excess supply or low supply.

Technically speaking, trading bitcoin is safe, but as a potential investor, you should not ignore the probable inherent risks. Before buying Bitcoins, you are required to open a wallet where you can store them. If you forget the password or private key to your wallet, then you are exposed to the risk of losing your entire investment. There is no going back procedure in the system. You should keep your wallet safe by enabling 2-factor authentications to void the risk of losing your investment.

2 factor authentications, usually additions to your normal login password, includes either a code generated in real time using google authenticator application on your mobile device, or a code that is sent to your mobile phone number(or email). This code is needed after you have input your normal password to enable you to login safely, as no one else can login unless they have access to this code.


bitcoinBUY AND SELL BITCOINS WITH EASE

Trading Bitcoins is actually a very straight forward procedure. You can simply open an account and purchase bitcoin within minutes. You can buy Bitcoin using the local currency from a trader who already has Bitcoins in the wallet. The first step to buying Bitcoin is identifying the brokerage platform you want to use and open an account with them.

There is a number of platforms out there that you can create an account with but for beginners, I recommend you to open an account with www.localbitcoins.com. This is the go to platform, where you can buy bitcoin in a few munites using your card or cash and in your local currency. ​Once you have opened an account and your wallet is ready, you can safely and privately purchase your first bitcoin ever.


Now you have Bitcoins in your wallet, what next?

Once you have Bitcoin, you possess the power to do a number of things;

  • You can make online payments across the borders on platforms that accept bitcoin.
  • You could send some bitcoin as gifts to friends and family members
  • You can become the newest Bitcoin dealer in town. Buying and selling bitcoin for a cut on platforms like www.localbitcoins.com
  • From the comfort of your home, you can trade bitcoin just like FOREX or insurance brokers. You just need your PC and stable internet connectivity.
  • Furthermore, you can purchase Bitcoin and sit back as you watch the value of your investment grow. However, it’s not always one-way traffic; every investment has its risk due to volatility.

TAKE HOME

  • Create a wallet, verify your account.
  • Keep your wallet ID, and login details private and safe, preferably offline.
  • Enable 2-Factor authentication to ensure your wallet’s security.
  • You are ready to trade in bitcoins.

I do hope that this helps you and kick-starts your Crypto world.

Kindly revert back to me for any queries, you can leave a comment or a question and we will be happy to respond.

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To your online moneys.

Victor

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Comments (2)

  1. Very good information. That bitcoins website you provided was very informational as well.

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