Bitcoin for a beginner: What you should know

So, you have heard people talk about Bitcoin and ask, why all the fuss about this cryptocurrency?

Bitcoin for a beginner: What you should know.

Well, Bitcoin is a form of electronic money. It's a digital asset accessible via the internet only. People describe Bitcoin as an electronic combination of gold and cash.

People spend Bitcoin online the same way they do cash. However, Bitcoin's value is almost similar to that of gold. But unlike gold or money, Bitcoin is digital. That means you can't have physical Bitcoin. And with cryptocurrencies setting their new records, this might be the best time to learn more about Bitcoin and probably invest in it.

Bitcoin can be defined as a digital asset and as a network.

  • Bitcoin as a digital asset: As a digital asset, Bitcoin refers to digital coins. Bitcoin creator capped the number of these coins at 21 million.
  • Bitcoin as a network: Bitcoin network refers to the blockchain that powers this cryptocurrency. It's this network that gives this digital asset practical applications and value.

The abbreviation of Bitcoin as a digital asset is BTC. And this is the symbol of the coins that people collect, trade, and spend the same way they do with cash. Although these coins' generation is gradual, their possible maximum number is 21 million only.

On the other hand, the Bitcoin network refers to the technology that carries the transactions. It also keeps records of Bitcoin transactions. And nobody can control or change the Bitcoin network.

Demand and supply are the main factors that influence Bitcoin prices. One Bitcoin is worth the amount another person is willing to give to own it. But, people buy Bitcoin for three main reasons.

  • Payments: Some people purchase Bitcoin because they need it to complete digital transactions. For instance, some people buy Bitcoin to make international payments where it's the best option available for them.
  • Speculation: Some individuals and organizations think Bitcoin prices will keep rising. As such, they want to buy and eventually sell Bitcoin at a higher price to make profits. And because the possible number of coins that will ever be in circulation is 21 million, some individuals think Bitcoin is a finite and rare commodity. Bitcoin is also a digital asset. And this makes Bitcoin storage, transportation, and purchase more manageable.
  • Economic diversification: For some people, the Bitcoin network makes it secure than fiat currency. They think that government policies and elements like inflation and national debt will lower fiat money value. On the other hand, such factors can't affect Bitcoin's value.

The idea is that you can have your money even if your government collapses. More individuals are using Bitcoin as a tool for storing value, especially in countries faced with political instability.

There are many Bitcoin marketplaces online where you buy this cryptocurrency. However, most crypto traders and investors use automated bitcoin trading software. Bitcoin trading app helps people buy and sell this cryptocurrency without struggling. What's more, this platform provides the fundamentals of investing or trading Bitcoin effectively and securely.

With such platforms, you can efficiently study the crypto market to know when to buy or sell Bitcoin. And, you can move your Bitcoin to and from your digital wallet when it comes to buying services and products with this cryptocurrency.

Bitcoin is so far the most popular cryptocurrency with users globally. If you want to trade or invest in this digital currency, you should educate yourself about it. Also, monitor the market closely and use a reputable platform to trade or invest in Bitcoin.

*This is a featured post.

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