The Bitcoin recently made it world news when the price of the digital currency suddenly rose to a record high of more than $ 250 . But what is a Bitcoin actually and what can you do with it ?
The story of the Bitcoin begins in 2008, when Satoshi Nakamoto wrote a research paper in which he proposed a digital currency called Bitcoin.
No one had ever heard of Nakamoto, but what he had thought was revolutionary. A currency without a central bank , without interference from governments and without traceable track.
A Bitcoin is really just a small piece of code. Bitcoins can be transferred to others by sending a piece of a bitcoin to them.
How that happens is the genius of Bitcoin. There is no central system that keeps track of the transactions. Instead, each transaction is transmitted to the entire network of people who Bitcoin software running. For example, a Bitcoin never issued because the whole system knows what all previous transactions have been twice.
With the Bitcoin software the amount of Bitcoins which are also in circulation also increased. The software attempts by means of a complex to solve cryptographic algorithm puzzles.
Thus the number of Bitcoins has grown to over 11 million . It is expected that by the year 2140 the last Bitcoin is ‘squeezed’ – that’s the 21 millionth.
Mining – How to Get Bitcoins
If this succeeds, then the solver gets a ‘block’ Bitcoins. This process is also called the ‘minas’ said of Bitcoins. Thanks to the rising rate of Bitcoin is mining become a lucrative business .
Miners therefore build small supercomputers with many power generating Bitcoins . Bloomberg recently calculated that this process is now as much energy as 100,000 households.
Interesting 22 minute video on what bitcoins are and what the technique is:
In 2011, inventor Nakamoto left the last time you heard anything from him. Then he disappeared without a trace. His identity remains a mystery.
Meanwhile, his project adopted a life of its own. Others have continued the development of the software, and with Bitcoins can more and more products and services are purchased.
Payments in bitcoins are accepted by WordPress and also the dating site OkCupid, recently announced that it will accept the bitcoin currency.
In the first months of 2013 the Bitcoin quite suddenly increased in value. This was sometimes accompanied by considerable fluctuations , to a peak of over $ 250 . Mid-April ‘ snapped the bubble ‘ and the Bitcoin fell back to around $ 100 .
How exactly is , is unclear. Different people call the crisis in Cyprus as a reason for the sudden interest in Bitcoins.
Other financial experts suggest there their questioning. “If I wanted to make a safe investment, I would have bought gold right? That’s quite a lot safer than Bitcoin ” said Edward Castronova, a professor of telecommunications, opposite Ars Technica .
Certainly seems that any increase in the Bitcoin associated with increasing attention in ( social ) media, as is clear from this graph business magazine The Economist.
On the future of the currency is now prompting speculation. Some see Bitcoin as a hype, while others like the future of money see. For now is the fickle exchange the Bitcoin at least a very uncertain investment .
Why Invest in Bitcoins?
Investing in Bitcoins, should you do that? In a way, most investments are similar to gambling. Gambling looks fun because it’s like playing investor at high speed. Instead of waiting days, months, or years for an investment to pan out, the investor/gambler gets to see his investment play through in real-time. And the odds are typically double or nothing. What sets most investments apart from gambling is the risk factor involved. Most gambling is extremely high risk, where at very best you have a 50% chance of doubling your money. Most of the time your odds of getting an increase are far less than half. Casino’s are masters of getting people to invest, and they use all kinds of tricks.
How to Get Bitcoins? Where to Buy Bitcoins?
If your cmputer doesn’t have the speed for Bitcoin-mining you might be considering to buy Bitcoins. Instead of going to a bitcoin exchange rate or look for scam bitcoin merchants, a trustworthy broker might be a better idea.