You may have heard about Bitcoin but were never entirely sure what it is and what it meant. Well, it is not too late to get to know more about it. Here we will run through the most important questions for newcomers to cryptocurrency.
What Is Bitcoin?
Bitcoin is a type of cryptocurrency and was created in 2008 by a man/woman or group of people using the pseudonym Satoshi Nakamoto. It was then released into the world in 2009 and for over a decade it has grown in value and its uses.
It operates on blockchain technology. This technology is key to its success because it allows Bitcoin to be completely secure, open to the public and without interference from a central authority such as a bank or a government. It has become a borderless, cheaper and sometimes faster way of making peer-to-peer payments from any location and to any location – with a Bitcoin enabled wallet.
So, What Are Bitcoin Wallets?
Bitcoin wallets, such as the Luno Bitcoin Wallet, are a necessity for anyone wanting to buy bitcoin, hold it or trade it. They work just like other electronic wallets and bank accounts by storing currency in them ready for when you want to use it. However, there are a number of differences between bank accounts and Bitcoin wallets.
Whereas your bank account is managed and protected by the bank, your crypto wallets are not. You are your own bank manager and it is your job to keep your money safe by choosing the best providers. This ties in with the decentralized nature of Bitcoin and blockchain technology. There is always no overarching authority in control – it is always de-central to such entities.
What Is Bitcoin Mining?
How Bitcoin mining is achieved and the complexity of it is a conversation for a long dinner party (present with crypto fans of course). Yet, understanding the basic nature of crypto mining is not overly taxing.
When you make a payment with fiat currency, the bank will authorize your transaction and record it. Bitcoin mining is the work of the bank because remember in crypto there is no central authority. Miners spread around the globe will authorize Bitcoin payments and add them to the blockchain. They must make sure the transaction is genuine and accurate. In return, miners are paid with Bitcoin.
Predictions for Bitcoin in 2020
Bitcoin has been a bit of a rollercoaster since it became such a force and in 2019 everyone was surprised to see Bitcoin rally again and shoot up in valuation to $13,000. The biggest names in crypto all believe that Bitcoin will rally much higher in the following years. The likes of John McAfee, Tom Lee and China’s infamous trader Zhao Dong all expect Bitcoin to be worth a lot more very soon. So, it is not too late to get involved!
