Thursday , April 15 2021

Bitcoin: what it is and how it works, what is its price, how to buy it and where nnda nnlt | ECONOMY



After reaching an all-time high in early 2021, with a value of over $ 30,000, far exceeding its 2017 mark, Bitcoin It reopens the debate in the financial world, where for many it is already considered digital gold, while others say that using it would be a very risky bet, especially since we are facing a pandemic caused by coronavirus.

MORE INFORMATION: Bitcoin trades near its record high of $ 34,800 after rising 800% in March

Although its demand has increased and with it the price, there are several people who do not know exactly what are these cryptocurrencies that work on the basis of the blockchain and that can be operated on many platforms. If you are one of them, do not worry that below we detail everything you should know about it.

It is characterized by the fact that it is a decentralized system, which is not supported or controlled by any government or central bank, and its transactions do not require centralized intermediaries.  (Photo: Ina Fassbender / AFP)
It is characterized by the fact that it is a decentralized system, which is not supported or controlled by any government or central bank, and its transactions do not require centralized intermediaries. (Photo: Ina Fassbender / AFP)

WHAT IS BITCOIN?

He bitcoin is a cryptocurrency that is used as a payment system without the need to have a central bank behind it; that is, you can trade without intermediaries. Unlike traditional money issued by governments depending on economic conditions or monetary policy, this digital currency has been set since its inception with a limit of 21 million.

Its traditional unit of account is called bitcoin and is used to account for and transfer value. Each bitcoin consists of 100 million “satoshis”, which is the minimum unit of account. Another advantage is that it is not necessary to buy a whole bitcoin, because the fractions of this currency can be purchased.

It uses a work proof system to prevent double spending and counterfeiting (so that the same bitcoin is not spent multiple times or arbitrarily invented).  (Photo: Ozan Kose / AFP)
It uses a work proof system to prevent double spending and counterfeiting (so that the same bitcoin is not spent multiple times or arbitrarily invented). (Photo: Ozan Kose / AFP)

HOW DID THE BITCOIN APPEAR?

Bitcoin was conceived in 2008 by a foreigner who used the pseudonym Satoshi Nakamoto. This character worked on the source code of the reference application together with other volunteer developers until December 2010, when he decided to end his public activity.

Between 2010 and 2011, exchange platforms began to appear that facilitated the sale of bitcoins with local money through bank transfers. These were followed by payment gateways that gave merchants the opportunity to accept bitcoin payments by cashing the amount of local currency sales directly into their bank accounts. In this way, this cryptocurrency began to grow until it became what it is today.

Processing micropayments through the Lightning network or dating through OpenTimestamps are relevant Bitcoin applications for solving problems in different business areas.  (Photo: Ozan Kose / AFP)
Processing micropayments through the Lightning network or dating through OpenTimestamps are relevant Bitcoin applications for solving problems in different business areas. (Photo: Ozan Kose / AFP)

HOW DOES BITCOIN WORK?

Bitcoins are usually made through a type of platform called “wallets” or “wallets”.. If they are intangible assets, they are presented in the form of computer programs and if they are tangible assets, in the form of electronic devices.

Bitcoins can be used to buy goods anonymously; that is, each transaction is recorded in a public record, so that the names of buyers and sellers are never disclosed, only their wallet IDs, published CNN.

Likewise, the operation of bitcoin is very practical, because you can make cheap international payments, because these cryptocurrencies are not linked to any country or are subject to regulation.

It should be noted that exchanges between Bitcoin and the local currency usually take place through online platforms, face-to-face meetings and specialized ATMs. There are also a wide variety of platforms that facilitate the exchange of Bitcoin for other cryptocurrencies, including stably priced currencies called stablecoins.

Multinationals such as Microsoft, Dell, Time Inc.  and Dish Network allow bitcoin payment, as well as Virgin Galactic and Reddit, among others.  (Photo: Ozan Kose / AFP)
Multinationals such as Microsoft, Dell, Time Inc. and Dish Network allow bitcoin payment, as well as Virgin Galactic and Reddit, among others. (Photo: Ozan Kose / AFP)

BITCOIN WALLET, HOW DOES IT WORK?

Bitcoins are stored in a “digital wallet”, which works like a virtual bank account, which exists in the cloud or on the user’s computer.

HOW TO BUY BITCOINS?

There are three ways to buy bitcoins that the portal details Third.

  • Make a direct deal with a person who has bitcoin. To purchase these digital currencies you must have a wallet or virtual wallet, which you can get for free on various websites or internet applications. Once the seller receives the money, he will transfer the currency. If you want to transfer bitcoins, you will need a password.
  • Exchange platform. It allows you to buy or sell bitcoin using different currencies.
  • Deliver a product or service in exchange for currency. As in the first case, you will need to have a virtual wallet.
There are plugins for most e-commerce platforms such as WordPress, Drupal, among others, which facilitate its use as a means of payment.  (Photo: Ina Fassbender / AFP)
There are plugins for most e-commerce platforms such as WordPress, Drupal, among others, which facilitate its use as a means of payment. (Photo: Ina Fassbender / AFP)

BITCOIN PRICE

Defining the value of bitcoin in 2021 could not be said for sure, as the year begins and has begun to vary.

According to Iván Marchena, Vice President of PrimeXBT Operations for Latin America: “It is likely to reach $ 100,000 next year. It does not seem crazy to me because there are indeed many factors and the analysis of the previous cycle confirms this, in addition, the current scenario is very different from that of 2017, when the increase was given exclusively by speculation. Currently, Bitcoin is more established and adopted and this leads to a more organic growth. The current rally is just the beginning “.

A man reflects on a screen showing the exchange rates of cryptocurrencies at the Bithumb Virtual Currency Exchange in Seoul on June 20, 2018. (Photo by Jung Yeon-je / AFP)
A man reflects on a screen showing the exchange rates of cryptocurrencies at the Bithumb Virtual Currency Exchange in Seoul on June 20, 2018. (Photo by Jung Yeon-je / AFP)

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