Knowing How Bitcoin Works

Currently, Bitcoins are widely talked by many people as one of the medium of exchange in the crypto world or commonly called cryptocurrency. Something you need to know that this currency is not controlled by banks or any other institutions. It can be stored in a personal device, such as a computer or laptop with a wallet file format. Bitcoin uses cryptography which already provides a variety of basic-level security functions. This makes the currency that can be used for transaction and investment.

3 Main Things Making Bitcoin Currency Works

To understand how Bitcoin works, we must first know the parts of Bitcoin itself. It consists of three parts: blockchain, mining network, and wallet.

  • Block Chain

Block chain is the first part of this currency that records all of the transactions done with Bitcoin. The transaction is stated complete when entered into this section. This contains all the series of transactions both new transactions and old ones that have been stored a long time and each is connected with the previous block. We can even see and trace them all.

  • Miner

People who keep and guard transactions are called miners. They are called miners because they are tasked with mining new blocks which will keep a list of new transactions. As compensation for this work, they will get some Bitcoin as an incentive. Their role is indeed very important because it is mainly to make the Bitcoin network system works continuously.

  • Wallet

Bitcoin that we have will be stored in the wallet later. However, what is actually stored is only a private key that gives Bitcoin owners access to add transactions to the block chain. Bitcoin itself is stored as a transaction record that is in the block chain.

How to Use Bitcoin

To make a transaction, the first thing needed is a Bitcoin wallet. This wallet is only a private key pair that is used to mark transactions. However, we need a safe place to store this key because if lost all the coins will also disappear from circulation. The level of security depends on the amount of money you want to save. There are various types of wallets for almost all computer devices including smartphones. we need to remember that there is no cost to make a wallet, so there is nothing to limit us to make it.

After you made a wallet, you need to get a coin. It means we need to buy bitcoin singapore from an exchange or you can use another method like a bank transfer. When you buy Bitcoin with bank transfer, you will be asked for the wallet address. When the process is done, the place of exchange will send coins to the wallet.

Some companies receive payments with Bitcoin. There will be a wallet address for sending coins to the checkout section. The seller will receive a block chain from the network and check the transactions sent to the particular wallet. In the process, the seller who receives the money will usually wait until the transaction reaches an average of six blocks. Usually it takes about an hour to complete the transaction. After the transaction is completely done, you will get the product you want.

The Advantages of Using Bitcoin

When using Bitcoin for common transactions, you will get several advantages. First, avoiding counterfeiting money. Counterfeiting of money, in general, is often the case and easily done by various elements. however, cryptocurrency such as Bitcoin cannot be falsified. Then, in terms of security, which you can conduct transactions without you need to show your identity. In addition, by using Bitcoin you can make a transaction quicker and more practical.

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How to Collect Bitcoins for Transaction

Bitcoin is better known as the cryptocurrency. The appearance of Bitcoin was first introduced by someone claiming to be named Satoshi Nakamoto. Over time, this cryptographic currency has begun to be glimpsed and has many users. Some people may have been familiar with Bitcoin and some have not known about how to collect it and use it in a transaction. Here we can tell you about how you can get Bitcoins.

How You Can Get Bitcoins

  • Register yourself to an exchange

The first way we can do to use Bitcoin is to register on the exchange that we can choose based on our choice. Make a registration like creating an account in general. Fill in all data requested for this registration. Then, we have to wait for several times for the exchange platform to verify the data we provide during the registration process.

  • You can buy Bitcoins

Buying Bitcoin is one of the usual ways for Bitcoin users to invest. So, the maximum benefit will be obtained. You can buy it from a person, digital market, or outlet, and some provide to buy it via ATM. In addition, we are encouraged to buy Bitcoin when the exchange value is down. The Bitcoin we bought will be sold when the price is high.

  • Day Trading

Day Trading is a transaction of buying and selling Bitcoin which is carried out on the same day. For instance, in the morning the price of Bitcoin is low, we can buy at that time. Then, we can sell them when the value is high on the same day. This method is effective enough to get the benefit. But we must prepare a long time to analyze the value of Bitcoin.

  • Selling service or product

In any case, you can get any of Bitcoin with another method, this may be one you can do. You sell what you can do like a service or product you have and you will be paid with Bitcoins. However, you only can do this transaction with someone possesses Bitcoins. So that he can pay you.

  • Mining

For mining, users need to be supported by software and hardware. Previously, users must first understand what devices support to mine Bitcoin. This method is somewhat profitable because you can get Bitcoin without capital.

Tips for Minimizing Bitcoins Losses

Collecting Bitcoins indeed can be done in several ways as above. However, it is important too to pay attention to some things that will minimize the loss in Bitcoins transactions. First, avoid unrealistic offers. Usually, cryptocurrency fraud can disguise their identity using social media accounts or professional-looking banner ads. Second, be aware of web phishing. Many fake landing pages claim to be a popular digital currency exchange platform. This technique is usually able to deceive consumers because web pages can look so real. Third, to minimize losses incurred in Bitcoin mining you must pay attention to the software used. You need to install software that matches your hardware.

Well, so that’s all we can provide you some information about Bitcoins on how you can get Bitcoins for you to use them in a transaction.

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