Bitcoin, as you probably know by now, is a digital currency that is based on peer to peer networking. It is the first ever digital currency to be released and it is very popular. Bitcoin has been in existence since 2009. The idea behind bitcoin is to have a currency that is decentralized and free of any government interference. The currency is not controlled by a central bank or government and it is not regulated by any other entity.
The currency is created by the use of an algorithm called’mining’. Miners are people who help in the creation of the currency by solving complex mathematical problems. Once the problem is solved, the miner receives a reward in bitcoins. This reward is then added to the total supply of bitcoins in circulation. The more bitcoins that are mined, the fewer will be available for general public use.
Bitcoin is a deflationary currency. That means that the amount of bitcoins in circulation will never increase beyond 21 million. However, if a bitcoin is lost or stolen, the value of the currency can drop drastically. The currency is also very volatile. Its value fluctuates between $400 and $1200 per bitcoin.
There are two ways of buying bitcoins. You can either buy them directly from a seller or you can buy them indirectly through an exchange. An exchange is where you trade your local currency for bitcoins. These exchanges are also known as ‘bitcoin brokers’ or ‘bitcoin exchanges’. The price of the currency depends on supply and demand. There are also ‘fiat exchanges’ where you can convert your local currency into bitcoins. This is usually done when you are traveling abroad.
There are a number of websites where you can find out the current value of bitcoin. They also provide information about how to buy and sell bitcoins.
