In it you will learn about the following things:
- Introduction
- What is cryptocurrency ?
- What is Bitcoin?
- How Bitcoin work?
- Uses of Bitcoin
- Limitations of Bitcoin
- Is Bitcoin legal in india?
- How to get Bitcoins?
Introduction
New technologies keep coming in the world from time to time. Right now we are talking about cryptocurrency. Cryptocurrency is also called as 'Crypto'. It is about virtual currency and payment gateway system. Only 8% percent of the total money in the world is physical money in the form of notes and the remaining 92% is digital money. We all know that Elon musk is interested in investing in crypto currency and has already made investments. Elon musk life lessons helps to grow our life.
What is cryptocurrency?
fig. Crypto currency
Cryptocurrency is in the form of digital currency and also it make transactions by using cryptography and decentralised system. Now to make transactions we are using payment gateway systems like visa, mastercard etc. But in cryptocurrency it is the money and it is the payment gateway system. We Can't see it, we can't touch it,it's all on the internet. At present people are afraid to using cryptocurrency, but it could be the money of the future. There are more than 10 thousand cryptocurrencies but we know Bitcoin the most.
What is Bitcoin?
fig. Bitcoin
Bitcoin is the independent system and digital currency, it make payment transactions by solving maths problems and record transactions data within it. Initially when it came, it had no value but now it is worth between 15 to 16 lakhs. In October 2008, a man named satoshi nakamoto released a 10-page white paper on the Internet. He announced the introduction of a decentralized cryptocurrency called Bitcoin. He developed the bitcoin very systematically, 1bitcoin = 100000000 satoshi. When satoshi nakamoto created it, he put a rule that there should be only 21 million bitcoins and not a single bitcoin can be created beyond that. Due to this single rule, the demand for it will increase and its price will increase.
How Bitcoin work?
In the above already said that it has no mediators, but it contains miners to verify the transaction. The total working process is called as "Bitcoin Mining process", the people who do this mining process are called 'Miners'. For example, when one person transfers bitcoin to another person, a block is created which contains a mathematical problem. Now these bitcoin miners solve that problem and add that block to the ledger network called ''block chain''. The transaction amount of who sent Bitcoins to whom in the world is in this black chain. This whole information is not just on one computer, it is constantly updated on the network of all the miners in the world.
Bitcoin mining creates some new bitcoins which are used by bitcoin miners. Adding a block to the blockchain will yield 12.5 bitcoins. You may have some doubt like if we can do this bitcoin mining? No, it is a very difficult task. To solve these problems, you have to use big computer servers, and the current bill for them is in lakhs. A huge heat is generated from those servers and they should have a cooling system.
The way satoshi nakamoto has designed it is that as the number of miners doing Bitcoin transactions increases, the maths problems become more difficult, and also reduce the number of bitcoins that miners are rewarded with.
In starting, if one block is added to blockchain they will get 50 bitcoins then the number was reduced to 25 and then 12.5, now bitcoin miners will get 6.25 Bitcoins. In future (2024) it will reduced to 3.125 Bitcoins. New bitcoins are created for those who do mining like this and they come as a reward and they come into circulation. At present 19 million Bitcoins are existed. It will be the year 2140 when the last Bitcoin will be created.
One interesting story about Bitcoin:
One interesting story about Bitcoin is the case of the "Bitcoin Pizza Day." In 2010, a programmer named Laszlo Hanyecz made the first known purchase using Bitcoins. He offered to pay 10,000 Bitcoins (which at that time was worth around $40) for two Papa John's pizzas. At the time, Hanyecz thought that 10,000 Bitcoins was a small price to pay for two pizzas, but as the value of Bitcoin increased, those 10,000 Bitcoins would be worth over $500 million today.
To commemorate this event, every year May 22 is known as "Bitcoin Pizza Day" among the community, and it's considered as a reminder of the early days of Bitcoin and how far it has come since then.
Uses of Bitcoin
Bitcoin is a decentralized digital currency that can be used for a variety of purposes. Some of the most common uses of Bitcoin include:
• Online Purchases: Bitcoin can be used to purchase goods and services online from merchants who accept it as a form of payment. This allows for fast, secure, and cost-effective transactions without the need for traditional payment methods such as credit or debit cards.
• P2P Transactions: Bitcoin can also be used to make peer-to-peer (P2P) transactions without the need for a middleman. This allows individuals to send and receive money directly with each other without going through a bank or other financial institution.
• Investment: Bitcoin can also be used as an investment asset. Its value can fluctuate greatly, and many individuals buy and hold it with the expectation that its value will increase in the future.
• Online Gambling: Bitcoin is also a popular choice for online gambling. Many online casinos and sportsbooks accept it as a form of payment, allowing for fast and secure transactions without the need for traditional banking methods.
• Remittances: Bitcoin can be used to send money internationally without the need for traditional remittance services. This can be faster and cheaper than traditional methods, making it a popular choice for sending money to family and friends in other countries.
• Anonymity: Bitcoin allows for anonymous transactions. This makes it a popular choice for individuals who value their privacy and want to keep their financial information private.
• Blockchain Technology: Bitcoin's underlying technology, the blockchain, has many potential uses beyond just digital currency. It can be used to create decentralized applications, smart contracts, and more.
• Trading: Bitcoin can also be traded on cryptocurrency exchanges, where it can be bought and sold for other cryptocurrencies or traditional fiat currencies. This allows individuals to buy and sell Bitcoin in a market setting, similar to trading stocks or other assets.
Bitcoin is a remarkable cryptographic achievement and the ability to create something that is not duplicable in the digital world has enormous value." - Eric Schmidt, Former CEO of Google.
Is Bitcoin legal in india?
As of 2021, the legal status of Bitcoin in India is uncertain. The Reserve Bank of India (RBI) has issued a warning to the public about the potential risks associated with Bitcoin and other cryptocurrencies. The RBI has also prohibited banks and financial institutions from dealing with or providing services to individuals or entities involved in the buying, selling, or trading of cryptocurrencies.
However, the Indian government has not yet passed any legislation that specifically bans the use of Bitcoin or other cryptocurrencies. Some reports suggest that the government may be considering a ban on cryptocurrencies, but no official decision has been made.
As a result, the use of Bitcoin and other cryptocurrencies in India is currently in a legal grey area. Some individuals and businesses continue to use and trade cryptocurrencies, while others have stopped due to the uncertainty surrounding the legal status. It's important to note that the laws and regulations regarding cryptocurrencies are subject to change, it's always best to stay informed and consult with a legal professional before making any decision.
How to get Bitcoins?
There are several ways to obtain Bitcoins:
1. Buy Bitcoins:
The most common way to obtain Bitcoins is to buy them on a cryptocurrency exchange. These exchanges allow individuals to buy and sell Bitcoins (and other cryptocurrencies) using traditional fiat currencies such as USD, EUR, or INR. Some popular exchanges include Binance, Coinbase, and Kraken.
2. Mining Bitcoins:
Another way to obtain Bitcoins is through mining. This process involves using specialized computer hardware to solve complex mathematical equations in order to validate Bitcoin transactions and add new Bitcoins to the network. Mining can be a complex and costly process, but it can also be a profitable way to obtain Bitcoins.
3. Earn Bitcoins:
Some websites and apps allow individuals to earn Bitcoins by completing tasks or participating in surveys. This can include watching advertisements, clicking on links, or playing games.
4. Accept Bitcoins as Payment:
If you are a business owner or freelancer, you can also accept Bitcoins as a form of payment for goods or services. This can be done through a variety of payment processors, such as BitPay or CoinPayments.
5. Bitcoin ATMs:
Bitcoin ATMs are now available in some countries, you can buy Bitcoins using cash or credit/debit cards.
It's important to note that obtaining Bitcoins through mining or earning them through online tasks can be time-consuming and may not be as profitable as buying them directly. Additionally, before buying, mining or earning Bitcoin, it's important to research and understand the potential risks and regulations involved in order to make informed decisions.
Conclusion
In conclusion, Bitcoin is a decentralized digital currency that uses blockchain technology to facilitate secure and fast transactions. It has a wide range of uses, from online purchases and P2P transactions to investments and online gambling. While the legal status of Bitcoin in India is currently uncertain, individuals and businesses can obtain Bitcoins by buying them on a cryptocurrency exchange, mining them, earning them through online tasks, or accepting them as payment. Bitcoin's value can fluctuate greatly, and it's important to understand the potential risks and regulations involved before making any decisions. Despite the challenges and uncertainty, Bitcoin has proven to be a revolutionary technology that has the potential to change the way we think about money and the financial system.
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