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What is bitcoin? The most comprehensive information about BTC

by fptware
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What is Bitcoin virtual currency? Why is it so much attention and investment?

If you intend to invest or simply find out what it is, the “neighbors” talk about it so much!
Then this is the right article for you.
Now, let’s find out together with FPTwaze!

What is Bitcoin?

Bitcoin (symbol BTC, XBT) is called by its father as “A Peer-to-Peer Electronic Cash System”. That is, a peer-to-peer electronic money system.
BTC is a cryptocurrency, also known as a digital currency (cryptocurrency, virtual currency)
From a user’s perspective, it is quite similar to the currencies on electronic wallets… that people often use.
But its difference is decentralization. Let’s see how the details are to be better understood!

Name Bitcoin
Symbol BTC,XBT
Inventor Satoshi Nakamoto
Date of birth 03/01/2009
Maximum total supply 21.000.000 BTC
Official domain name https://bitcoin.org/
Discussion forum Bitcointalk
Source code https://github.com/bitcoin/
White Paper https://bitcoin.org/bitcoin.pdf

 

How is BTC different from regular money?

Before talking about what are the differences between them, let’s talk about the common point first. The common point between these two currencies is that they can be paid and transferred between parties. Just that simple!
Then what’s the different point? Compared to fiat currencies like EUR or even USD, they are usually controlled by the government or central bank.
But for BTC, no one can control it. This is what makes it so special.
In addition, it does not exist in the form of coins, paper or polymer like ordinary money that people use. It exists entirely in digital form.

  Bitcoin Fiat currencies
Management A computer network running an open source network Issued by the government
Value Mainly based on the law of supply and demand Based on the government to issue it mainly
Assurance By a computer network that verifies every transaction By a 3rd party such as bank, government
Is there a coin or coin? No Yes

 Who created bitcoin?

Bitcoin was created by an individual (or organization) but did not want to reveal his identity, so he took the name Satoshi Nakamoto.
Hearing the name will make us think this is a Japanese person. But many people believe that this is not an individual from Japan but Elon Musk.
For those who do not know, Elon Musk is the founder of SpaceX, co-founder of PayPal and Tesla Motors.
But most of the people the community considers Satoshi are denied. Only Craig Wright – Australian scientist and businessman identifies himself as Satoshi Nakamoto.
Because he claimed to be the creator of Bitcoin but could not prove it, C.W was named “Faketoshi” by the community.
Until this day, the identity of Satoshi Nakamoto is just a big question.

How was Bitcoin born?

In 2008, the world financial crisis occurred due to the US real estate bubble. Followed by Lehman Brothers – the 4th largest investment bank in the United States declared bankruptcy with a debt of $ 619 billion.
The US and world economies is wobble. A series of consequences such as unemployment, bankruptcy, …
Doubts about the traditional banking system arise from here. At the time, the domain bitcoin.org was registered on August 18, 2008.
On October 31, 2008, the Bitcoin Whitepaper was released by Satoshi Nakamoto.
January 3, 2009 Genesis Block – the first block on the Bitcoin Blockchain was born. For the first time, a currency that was not controlled by a government or a central bank was born.

How does Bitcoin work?

Bitcoin works on Blockchain technology. This technology allows you to transact without having to go through a third party.
Blockchain provides a ledger. It contains all transactions on the network.
When you make a transaction, it is first validated by the Miner. The miner here is actually a computer.
This machine does the verification for transactions. In return they will receive the usual part of BTC.
Then, if there isn’t any fraud, your transaction will be added to this ledger. That means your money transfer is successful.

For example:
You have a relative in the UK. If they want to send you money, they will have to go to the bank or transfer it to your VISA card or an online payment gateway.
In general, they have to go through an intermediary and pay a fee. It may take several hours or even days for the funds to be transferred to you.
When the

money has passed, you have to go to the bank to wait for the withdrawal procedures or go to the ATM to withdraw. This process takes a lot of time, effort and money.
Moreover, you and your loved ones are choosing to trust the bank.

What if the bank is attacked by hackers? Or has someone in the bank modified your transaction?

But if your loved one uses Bitcoin, it’s different. They can still send you money without going through an intermediary.
Just have an internet connection, it only takes 5-10 minutes. They can send you BTC from somewhere in the world. Remittance fee is almost = 0 Selling it is as easy as gold or dollars at the current exchange rate.

Why can we trust Bitcoin?

We can trust Bitcoin because we “don’t need to trust anything”. It sounds confusing, right! But that’s the truth.
With Bitcoin virtual currency you can transfer it from one person to another without going through another third party like a bank to build trust.
In addition, Bitcoin is open source and completely decentralized. If you are a programmer then you can check how it works.
Every transaction on the Bitcoin network is public and anyone can check it. Once you make a transaction, nothing can edit or reverse it.
Because it is not under the control of anyone even the creator of BTC himself.

Units of Bitcoin

Bitcoin virtual currency also has the unit “Satoshi” after its creator “Satoshi Nakamoto”. Satoshi is the smallest unit of this coin.
We can convert 1 BTC = 100,000,000 Satoshi. That is one satoshi unit = 0.00000001 BTC.


Advantages of cryptocurrency BTC

As leading experts assess, the birth of bitcoin marked a historic turning point in the form of electronic payment. Bitcoin has great advantages and is superior to other currencies:

  • Convenience in transactions
  • Bitcoin can’t be faked
  • High security and very safe
  • High security and very safe
  • Extremely low transaction costs
  • Potential for e-commerce development

Convenience in transactions

As with banks or online payment services (intermediaries), there will often be a limit on transferring and receiving money in a day and time.
But with bitcoin, absolutely not. You can send as much as you want, anywhere in the world at any time to your family and friends without anyone managing the amount you send

Bitcoin can’t be faked

Another advantage of bitcoin is that it cannot be faked, because bitcoin does not exist in a physical form like other currencies.


Moreover, there is no cost to verify bitcoin while gold is very high.

High security and very safe

All bitcoin transaction information is displayed on the internet, but the identity of the trader does not appear, so the security of information is very high.
Up to now, the bitcoin protocol has not had a security hole to lose users’ bitcoins.

Extremely low transaction costs

Since there is no intermediaries to manage bitcoin transactions, the cost = 0. You only have to pay transaction processing fees on the systems but it is very low.
A transfer of 49552 BTC (~480 million USD) only costs about 0.18 USD.
Can you imagine how low it is?

Environmental Protection

Bitcoin currency does not have to use chemicals to create it, so it is very environmentally safe.
The computer system that processes Bitcoin transactions consumes much less power than the current financial system.

Potential for e-commerce development

Currently, there are many businesses, companies, and stores that allow the use of bitcoin to pay bills.
Every bitcoin transaction cannot be refunded or reversed, so any fraud is useless.

Disadvantages of Bitcoin Cryptocurrency

Although BTC has many advantages, nothing is perfect. The disadvantages of this coin can be mentioned as:

  • The number of users is not much
  • It’s not easy to use bitcoin
  • Bitcoin price often fluctuates
  • Hackers, criminals launder money

The number of users is not much

Bitcoin is mainly used in developed countries such as the US, China, … and in undeveloped countries, the use of paper money, gold is too familiar.
And most people are not knowledgeable about cryptocurrencies. Some groups of people who do not have enough knowledge, do not know what bitcoin is, think that BTC is an unreliable virtual. So they are still afraid and afraid to use bitcoin money

Not easy to use

Without knowledge of technology and a real understanding of bitcoin, it is difficult to use and trade it. As described above to use this currency you need to create a bitcoin wallet, and exchange it for cash.
Therefore, for those who do not know anything about information technology, they need someone with experience to guide them to do these jobs.

Prices often fluctuate

Just like the dollar, euro, gold or stock market, bitcoin also fluctuates in real time.
Sometimes strong, sometimes plummeting, almost any fluctuations in the world that affect cryptocurrencies can cause the price of bitcoin to fluctuate.

For example, when the new bitcoin was released, the price was only a few dollars, but at the moment the price of 1 bitcoin has reached over $1000.
Hackers, criminals launder money
Because of the unregulated form of bitcoin transactions, many criminal groups use this currency as a transaction method.
Hackers can also find and attack many bitcoin exchanges and steal. Besides, money laundering can happen at any time

Why is Bitcoin valuable?

Bitcoin is valuable because it possesses the same characteristics as currency, silver and gold:

  • Reliability
  • Mobility
  • Exchangeability
  • Scarcity
  • Can be divided
  • Easy to recognize

It’s all about technology, not trusting central banks like fiat money. Nor does it rely on physical properties like gold and silver.
But all of the above factors cannot determine the value of Bitcoin. The most important determinant of Bitcoin’s value is its acceptance and trust.
Today many businesses accept Bitcoin as a form of payment. This proves bitcoin has value, not something worthless.

Can Bitcoin become worthless?

The answer is possible. In the past there have been many coins that have become worthless such as that of Zimbawe, Venezuela.
They become worthless because of hyperinflation, which bitcoin will not happen in Bitcoin. However, there will always be the possibility of the failure of Bitcoin: technical errors, currency competition, politics, etc.
So no currency is absolutely safe, they will fail or fail at some point.
But Bitcoin has proven itself valuable and has the potential to grow. However, the future of Bitcoin is unknown, right?

Bitcoin is a bubble?

“Is Bitcoin a Bubble or Not?” This is a difficult sentence.


From many perspectives, each person will have different opinions about Bitcoin.

For example, billionaire Warren Buffett thinks that Bitcoin and other cryptocurrencies have no value.
But for Robert Kiyosaki (businessman, author of the book Rich Dad, Poor Dad) sees this as the currency of the people.
In the past there have been many bubbles that have burst (dot-com, US housing, etc.) but after all, Bitcoin is a little different from them.
So is Bitcoin a bubble in the end? This only time will tell.

If it’s a bubble, it hasn’t burst yet. So when will the bitcoin bubble burst? The answer is when this coin is not useful to people anymore.
It will continue to grow and exist as long as it can be put into practice.

Is there any virtual currency that surpasses Bitcoin?

There may be. Because of the future, who knows what will happen in advance, right?
Until now, “Bitcoin is King” is a popular phrase in the crypto community. That’s right, this coin is like a king of cryptocurrencies.
But in the future, if there is a currency that does better than BTC, it is very normal to be “dethroned”.

Should you invest in Bitcoin?

Compared to other markets, the cryptocurrency market in general or Bitcoin in particular, fluctuates up and down a few percent per day, which is very normal.
It is this factor that many people choose BTC to trade coins (trade transactions) to make daily profits.
In the long run this is a potential currency if you believe in its value. Of course, investing always comes with risks. The greater the risk, the greater the return.

Legality in countries around the world

The map below depicts the legality of bitcoin around the world:

  • Green: Legal
  • Gold: The law does not prohibit, but also admits, causing controversy.
  • Pink: Still controversial but not directly banned.
  • Red: The law is against BTC

How to use BTC?

  • Learn more about this cryptocurrency
  • Create a wallet to store and use Bitcoin
  • Buy BTC from exchanges or Bitcoin ATM
  • Use at places that accept payment in BTC
  • Cryptocurrencies are different from regular fiat money so you have to learn to use them. To find out, you should read this article and related articles.

Where to store Bitcoins?

Perhaps you are wondering how to send bitcoins, with what and where to store bitcoins? Then a bitcoin wallet is the answer, a bitcoin wallet is used to store and trade bitcoins.
Some reputable sites allow creating bitcoin wallets such as: Blockchain, Coinbase, Jaxx, Atomic, Exodus, Electrum, …
Most bitcoin storage wallets have extremely high security through many layers, If you want to log in, you need to authenticate via email and phone number or you have to enter the google authenticator security code.
However, you absolutely must not reveal your wallet information to anyone. Because if they have credentials to your wallet.
They can make transactions and steal all the bitcoins in your wallet.
There are 2 types of bitcoin wallets:

  • Hot wallet
  • Cold wallet

Hot wallet is the type of wallet that you know and use today. For example, Atomic, Exodus, Jaxx, Blockchain are all hot wallets.
The security of hot wallets is also very good. But if your computer or phone has a virus or uses crack software, it’s better to reinstall your computer to ensure your safety.
With cold wallets, you are more assured of security because even if your computer is infected with a virus, it is difficult for hackers to get your crypto assets.

Where can BTC virtual currency be used?

During 2012, 2013 around the world, they mainly used bitcoin to shop online or use online services.
However, starting from 2015 onwards, quite a few companies, businesses and stores have allowed the use of this currency for online and offline payments.
According to a 2020 survey, 36% of US SMEs accept Bitcoin. Some large companies that accept this form of payment include:

  • Microsoft
  • Expedia
  • Wikipedia
  • AT&T
  • Burger King (Venezuela, Germany)
  • KFC (Canada)
  • Subway
  • Overstock
  • Twitch
  • Mega.nz
  • Amazon (not directly)

In addition, you can also accept payments with this virtual currency at Coinmap

Has the BTC cryptocurrency ever been hacked?

Up to now, more than 10 years since its launch, Bitcoin has not been hacked once. This proves that this virtual currency is very well designed.
The hacks related to this currency all come from the exchange. A classic case such as the Mt.Gox exchange was hit with 850,000 BTC.
At current exchange rates, this amount of stolen BTC amounts to $7.4 billion.
There are also many other cases related to BTC being hacked on exchanges. Of course hackers get Bitcoin by exploiting security holes from the exchange.
This affects the price of BTC but its network is not damaged at all.

How many Bitcoins are there in all?

Bitcoin’s supply is 21,000,000 coins, we cannot increase or decrease this amount. The reason why there are only 21 million coins, no one can know.
Since the supply is fixed, the only way to get new BTC is to mine bitcoins.

What is Bitcoin Mining?

Bitcoin mining is using software that processes transactions and secures it. In return, the miner will receive the rewards of this coin. The speed of mining fast or slow depends on many factors such as: Hash rate, …
In order to avoid this currency from being inflated and depreciated, it is established a mechanism called Bitcoin Halving.
Every 210,000 blocks about 4 years the Halving event will take place. The block reward of miners will be halved.
This means that the number of BTC in circulation will decrease every 4 years. Therefore, the percentage of inflation also decreases over time.
The current inflation rate of this virtual currency is ~3.7% according to Woobull. It is estimated that by 2140 (64th Halving) there will be no more BTC to mine. That means % inflation will be 0%.

Why does Bitcoin need to scale?

Because this is a must for Bitcoin to become a kind of payment tool serving the entire population of the world.
Currently Bitcoin can process about 3 transactions/second on average. The reason is that the block size of this coin is only 1MB and the Proof-of-work consensus protocol.
Meanwhile VISA can handle about 4000 transactions per second and has the ability to scale up to 65000 transactions per second.
Therefore, to ensure future growth and use at a broader scale, Bitcoin needs to scale.
Extensible solution

Fork (Fork)

With this solution, to change the ability to process transactions, it is necessary to change the technical issues of Bitcoin such as: increasing the block size, etc.
This process of change is known as a fork. Changes that are compatible with the network are called Soft Forks, changes that are not compatible with the network are called Hark Forks.

2nd layer (Layer 2)

The second layer is a framework or a second protocol built on top of the existing blockchain network.
The solution to extend layer 2 for Bitcoin is the Lighting Network. It makes it possible to transfer money instantly with almost free fees.

Bitcoin money is virtual?

“Is bitcoin real money?”, “Does the admin have any opinion about bitcoin virtual currency?”.. FPTwaze often receives questions like this.
But if explaining to each person, it is quite lengthy and time consuming, so today Admin decided to write this article for you to have more information about this currency.
In fact, bitcoin is not a virtual currency but a real money or otherwise known as “cryptocurrency”.
Many people who are new to it or do not have enough information call bitcoin a virtual currency. This call is very misleading for those who do not know anything about it.
Because the word “virtual currency” refers to something that is not real, often virtual currency is used within a certain community.

For example:
When you deposit money into the game, it is virtual money, it is almost impossible to convert to real money and if so, the value is very low due to the two parties’ regulations when trading. Moreover, the way to create virtual currency and operate it is completely different from bitcoin.
In contrast, bitcoin currency can be exchanged for real money and has great value. Moreover, this currency is widely used and has international stature. It can be used to buy things of value like real money.

Will Bitcoin “Die”?

It is a fact that negative information is often received and spread by the community more widely than positive news.

For example, a point like bitcoin, the benefits it brings to users in terms of cost reduction and convenience in payment, the number of people sharing it is very small.
In contrast, information such as “Bitcoin scam”, “bitcoin investment scam” spreads very quickly.
And often the people sharing it are people who don’t even know what bitcoin is.

However, recently when a number of major newspapers published positive news about bitcoin, some sections of the public began to recognize and think differently about this currency.
Experiencing many seemingly “discarded” stages, but bitcoin is still alive and thriving.
Moreover, if you want to stop bitcoin transactions, it will almost take down the entire internet, so the possibility of bitcoin dying is very low.

So FPTwaze has helped you answer questions about what bitcoin is and should invest in bitcoin or not.
Hope these few articles will bring a lot of useful information to you. Also this article will give you a more accurate look at the bitcoin currency

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