Bitcoin – a decentralized digital asset running on the blockchain technology. Blockchain Technology – A digitally distributed decentralized public ledger that exists across a network.
While Bitcoin falls under the asset class, people have still adopted it as a medium of exchange, i.e., paying for services or buying goods using Bitcoin. Bitcoin was introduced in 2009 by an anonymous person or group of people by the name Satoshi Nakamoto. To date, no one knows who Satoshi Nakamoto is or who they are.
There will only ever exist 21 million Bitcoins for the entire world. No more Bitcoins can be introduced on the network. This is usually referred to as the “hard cap” by Bitcoiners.
Bitcoiner – A person who uses or mines Bitcoin.
Since Bitcoin is used as both a medium of exchange and a store of value, to have Bitcoin, you need to have the following:
- A device (e.g., phone, laptop, computer, flash drive, etc.).
Wallets – A Bitcoin wallet is a place that stores your Bitcoin and validates your transactions when you are using your Bitcoin. A wallet keeps secret information called private keys or seeds used to validate transactions and sign them so that your Bitcoin can be used to purchase or exchange with other assets. Unlike banks, it is decentralized, which means that there is no central authority responsible for your Bitcoin. You will always be responsible for your own Bitcoin, from storing, transacting, or paying for services.
Bitcoin can be purchased through many sources, including exchanges such as Binance or Coinbase. Through the exchanges, you can buy Bitcoin and have them transferred and stored in your wallets. Although many exchanges have wallets within the exchanges, it is always advisable to have them transferred to your personal wallets and have your own private keys. This is referred to as self-custody.
You can create an account with Binance and Coinbase using the links below: Binance – https://www.binance.com/en/activity/referral-entry/CPA?fromActivityPage=true&ref=CPA_00M5ZGAVUI Coinbase – https://coinbase.com/join/ongoma_5?src=android-link
There is a difference between a Bitcoin exchange site and a wallet. An exchange is a marketplace for cryptocurrencies like Bitcoin. There are many more cryptocurrencies, but Bitcoin is the dominant and well-established among all. On an exchange site, people also trade the cryptocurrencies. A wallet is a piece of software or hardware that allows users to interact with the blockchain network. A wallet might not have as many options as an exchange, but it is the safest way to store your Bitcoin.
The following are different types of wallets where you can store your Bitcoin:
- Beginners – Exodus
- Advanced Bitcoin users – Electrum
- Best for mobile users – Mycelium
- Best hardware wallet – Ledger Nano X
You can create accounts with any of these by downloading the apps from the App Store or using their websites. Ledger Nano X is a hardware wallet that you can purchase from their official website. It is a flash drive designed to store Bitcoin.
Bitcoin transactions are borderless; you can transact any amount of Bitcoin from the comfort of your home to any part of the world instantly at a very small cost. You will just need what is called a sender’s address and a receiver’s address; these are like the bank account numbers for banks. You can share the public address with anyone to receive or send Bitcoin, but nobody can access your Bitcoin using the public address.
When Bitcoin was introduced in 2009, the value of 1 Bitcoin was worth 0.001 USD, but as Bitcoin grew popular and its demand increased rapidly, the current value of 1 Bitcoin is about 20,840 – 21,161