Bitcoin is a relatively new currency that is gaining momentum fast. In the past, Bitcoin has experienced rapid growth and modifications to its protocol which has allowed it to become more stable, scalable and secure in comparison to other cryptocurrencies. During this growth period, it has been difficult for those who have wanted to purchase bitcoin but had no place to do so. Now, you can buy bitcoin in many ways.
What is Bitcoin?
Bitcoin is a decentralized digital currency, without a central bank or single administrator, that can be sent from user to user on the peer-to-peer bitcoin network without the need for intermediaries. Transactions are verified by network nodes through cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin is unique in that there are a finite number of them: 21 million.
Bitcoins are created as a reward for a process known as mining. They can be exchanged for other currencies, products, and services. As of February 2015, over 100,000 merchants and vendors accepted bitcoin as payment.
How to Buy Bitcoin
Assuming you don’t have any Bitcoin yet, you’ll need to purchase some. The two most popular ways to do this are through an exchange or a Bitcoin ATM.
Exchanges:
The most popular way to buy Bitcoin is through an exchange. Exchanges are online platforms that allow you to buy and sell cryptocurrencies. To use an exchange, you’ll need to create an account and verify your identity. Once your account is verified, you can link your bank account or credit card and start buying Bitcoin.
There are many different exchanges available, so it’s important to do your research before choosing one. Some things to look for include security features, fees, and ease of use. Popular exchanges include Coinbase, Kraken, and Binance.
Bitcoin ATM:
Another option for buying Bitcoin is through a Bitcoin ATM. Bitcoin ATMs are physical machines that allow you to buy Bitcoin with cash. To use a Bitcoin ATM, you’ll need to find one near you and insert cash into the machine. The machine will then dispense Bitcoin into your wallet.
Bitcoin ATMs typically have high fees and some require you to have a verified account before using them. However, they can be a convenient option if there aren’t any exchanges available in your area.
Storing Bitcoin
When it comes to storing your Bitcoin, there are a few different options available. You can either store it on an exchange, in a wallet, or in a vault.
Exchanges:
If you decide to store your Bitcoin on an exchange, you need to be aware of the risks involved. Exchanges are often hacked, and if your Bitcoin is stored on one that gets hacked, you could lose all of your money. Additionally, exchanges can be subject to government regulation, which could lead to them freezing or seizing your assets.
Wallets:
Wallets are a much safer option for storing your Bitcoin. There are many different types of wallets available, so you need to choose one that fits your needs. Some wallets allow you to store your Bitcoin offline (known as cold storage), which is the safest option. Others allow you to store your Bitcoin online (hot storage), which is convenient but less secure.
Vaults:
Vaults are the most secure option for storing your Bitcoin. They are similar to wallets, but they offer additional security features, such as multi-factor authentication and time-locked withdrawals. However, they also come with some drawbacks, such as high fees and complex user interfaces.
How to Sell Bitcoin
Assuming you already have Bitcoin, you now need to find a market or exchange to sell your Bitcoin. There are many different ways to do this, but the most common is through a cryptocurrency exchange.
Cryptocurrency exchanges are online platforms where you can buy and sell cryptocurrencies. Some exchanges only deal in certain types of cryptocurrency, while others deal in multiple types. When selling Bitcoin, you will need to choose an exchange that allows you to sell Bitcoin for fiat currency (like USD).
Once you have found an exchange that meets your needs, sign up for an account and verify your identity. Once your account is verified, deposit your Bitcoin into the exchange’s wallet. Then, place a sell order for the amount of Bitcoin you want to sell at the current market rate.
Once your order is filled, the exchange will transfer the fiat currency amount to your bank account. Note that there may be fees associated with selling Bitcoin on an exchange. Be sure to check the fee schedule before selling.
Where To Use Bitcoin
Bitcoin can be used in a number of different ways, depending on what you want to use it for. Here are some of the most common uses for Bitcoin:
– Online payments: Bitcoin can be used to make online payments to merchants who accept it as a form of payment.
– P2P payments: Bitcoin can also be used to make peer-to-peer (P2P) payments, without the need for a third party such as a bank or payment processor.
– investments: Some people choose to invest in Bitcoin, buying it with the intention of selling it at a later date for a profit.
– speculative trading: Another popular use for Bitcoin is speculative trading, where people buy and sell Bitcoin in an attempt to make money off of the fluctuations in its price.
Alternatives to Bitcoin
Bitcoin is not the only cryptocurrency available today. In fact, there are many alternative cryptocurrencies, often referred to as altcoins. Some of the more popular altcoins include Ethereum, Litecoin, and Monero. Each of these has its own unique features and benefits.
If you’re looking for an alternative to Bitcoin, there are several things you should consider. First, what are your goals? Are you looking for a cryptocurrency with different features than Bitcoin? Or are you simply looking for something less popular that might be cheaper or faster to transaction with?
Second, what’s your budget? If you’re not willing to invest as much money into an altcoin as you would into Bitcoin, then you might have to sacrifice some features or security.
Third, do your research! Not all cryptocurrencies are created equal. Some have been known to be scams, so make sure you know what you’re getting into before investing any money.
Finally, remember that cryptocurrency is a volatile market. The prices of Bitcoin and other cryptocurrencies can fluctuate wildly, so don’t invest more than you can afford to lose.
