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What is Bitcoin and How it works?

What is Bitcoin?

Bitcoin is a form of virtual currency, used for electronic purchases and transfer. Bitcoins are a modern equivalent of cash. Bitcoin are not physically printed, it is an electronic currency and its transactions are made with no central authority.

Why Use Bitcoin?

Bitcoin has several important features,

  • Bitcoins can be used to purchase anything you want (online or at merchant locations)
  • It’s fast and cheap.
  • There are no transaction fees, or in some cases fees are minimal.
  • No central authority has control over Bitcoin.
  • Bitcoin system allows you to do anonymous currency transactions.
  • International payments are cheap because bitcoins are not tied to any country or subject to regulation ( fees are minimal or free)
  • Once bitcoins have been sent, they’re gone.

How Bitcoin is created ?

Unlike currency, Bitcoin isn’t physically printed by any government. Bitcoin is created digitally by mining, it is created by solving complex mathematics puzzles using computer software known as Bitcoin Miner.

How do I get Bitcoins?

The two common to ways are:

  • Buy/sell on Exchange – Buy or sell bitcoins using different currencies on an Bitcoin Exchange.
  • By Transfers – you can accept/send bitcoins as a form of payment using mobile apps or computers software.

How to store your Bitcoins ?

Bitcoins are stored in a digital wallet. It can be stored in different ways

  • Online wallets – Online (on the cloud)
  • Desktop wallets – Runs on a user’s computer
  • Mobile wallets – Runs on a user’s mobile device
  • Hardware wallets – Dedicated devices which facilitate payments

How do I spend bitcoins ?

You can buy goods using Bitcoins or send it to the person. You can buy physical goods with bitcoin where it is accepted as a payment. Growing number of businesses are accepting Bitcoin, including Expedia, Overstock.com, Dish Network etc. You can send Bitcoins to anyone once you know their bitcoin address.

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