What is a Bitcoin?

What is a Bitcoin?

Bitcoin is a cryptocurrency / digital currency, which is intangible. It is not printed in paper, like dollars, pound, euro, etc. Bitcoins are produced by people, through computers using a software that solves mathematical problems. Bitcoin is based on mathematics while our typical currencies are based on gold, silver, oil etc.

Bitcoins are not handled by central banks and it is not accounted which makes the currency decentralized. It is created through bitcoin mining by people in a network where anyone can join. The network processes the transactions made with the digital currency.

Where can I keep my Bitcoins?

Bitcoins are stored in a Bitcoin wallet whether it would be installed in your phone, computer, storage devices like your flashdrives, or in a cloud wallet(e.g. Coins.ph, Coinbase). A wallet has its own unique wallet address (just like an email address) where people can use to send you money.

Must Read: Creating a Bitcoin wallet using Coins.ph

Where can I use my Bitcoins?

It could be used to pay for online shopping, bills, any local store or restaurant that accept bitcoins. More importantly, your bitcoins can be kept as an investment since the value of bitcoins have been rapidly increasing over the past years. You can convert your local currency to bitcoins, wait for the value to rise and exchange it again to your local currency. That way your money has increased. This is how Foreign Exchange (Forex) work.

Who created Bitcoin?

Satoshi Nakamoto created the Bitcoin to be an electronic payment system based on mathematical proof. The purpose was to produce a currency which is independent from any central banks / government, which can be transferred electronically within an instant.

Bitcoin unit division:

§  1 BTC = 1,000 mBTC (millibitcoin)

§  1 BTC = 1,000,000 μBTC (microbitcoin)

§  1 BTC = 100,000,000 Satoshis

§  1 mBTC = 100,000 Satoshis

§  1 μBTC (microbitcoin) = 100 Satoshis