Bitcoin has been in the news a lot lately. Some people are calling it the digital currency of the future, while others think it’s just a fad that will soon fade away.
No matter what you may have heard about Bitcoin, there is no denying one thing: It’s gaining popularity very quickly and for good reason.
To help you understand what exactly Bitcoins are, how they work and how to use them to your advantage, here are easy steps to get started with Bitcoin.
What exactly is Bitcoin?
Bitcoin is a cryptocurrency and worldwide payment system called the first decentralized digital currency, since the system works without a central repository or single administrator.
It was invented by an unknown programmer, or a group of programmers, under the name Satoshi Nakamoto and released as open-source software in 2009.
The system is peer-to-peer, users can transact directly without an intermediary.
Why use Bitcoin?
Right now most people use paper money to buy things. They give the paper money to a cashier at a store and then they get the goods.
We can also use credit cards, but they take some of your cash and hold it for you. Now we have this new thing called Bitcoin that lets you send money without having to use any middle people at all.
Bitcoin is a form of digital currency. It can be used to buy things just like regular money, but it is much more useful than regular money because you can use it anywhere in the world!
Get a Bitcoin wallet
A bitcoin wallet is a software to manage your Bitcoins. Bitcoin wallets make it easy to send and receive bitcoins, they take care of the security, store your private key and give you a set of public keys other people can use to send you money.
Bitcoin wallets are based on three main categories:
# Online Bitcoin wallets, which are hosted and managed from a third party;
# Hardware wallets, which are physical devices designed to secure bitcoins offline;
# Software wallets, which are installed directly on the device you want to protect.
Transactions with Bitcoin are made with no middle men – meaning, no banks! There are no transaction fees and no need to give your real name.
More merchants are beginning to accept them: You can buy web hosting services, pizza or even manicures.
As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.
Setting up a Wallet
Follow these steps to Set up a Bitcoin Wallet:
1. Download the Bitcoin Wallet from the Google Play Store. You can either chose Binance, or any crypto wallet of your choice.
2. Once you have downloaded the app, open it and create a new wallet by tapping on “Create New Wallet”.
3. Enter a strong password to secure your wallet.
4. Now, you will be asked to back up your wallet. This is very important as it helps you recover your funds in case of a lost phone or if the app crashes. You can either use the backup phrase provided by the app or you can write it down on a piece of paper.
5. Next, you will be asked to enter your public address. This is the address that people will use to send you funds. You can also choose to hide your public address.
6. Now, you will be asked to enter your private key. This is the most important part of your wallet as it helps you access your funds. It is very important that you keep this key a secret and secure it properly.
7. Next, you will be asked to enter your password. This is the password that you will use to access your wallet and send funds. You can also choose to hide this password as well.
Now, you’re good to go with your Bitcoin wallet.
Buying stuff with your Bitcoins
First you install a bitcoin wallet on your mobile device, or a computer. Then you go to a store, or a website that accepts bitcoins and tell them the amount of bitcoins you want to spend.
The cashier will then press a button that says “send coins” which sends an encrypted message to the blockchain network asking for approval to spend this many bitcoins.
Once the network verifies that enough miners have approved the transaction, it will be included in the next block of transactions. The transaction is then complete and you can walk away with your goods.
As a bitcoin user, you don’t need to know what is happening behind the scenes. All you need to know is that your transaction was included in the blockchain and that you have a valid private key to prove ownership of the bitcoins.
If you’re interested in learning how to get started with Bitcoin, it’s important that you follow these easy steps. The most important thing is to secure your own wallet. You can do this by creating a paper wallet or purchasing a hardware wallet.
When buying bitcoins, only purchase from trusted sources and remember that Bitcoin trading is also a risky business!