Everything you need to know about Bitcoin and how it works
January 30, 2019
All You Need To Know About Bitcoin Before Investing In It
January 30, 2019

What Is Bitcoin And How Are People Finding Success With It?

how does bitcoin work

Bitcoin was launched in the year 2009 by a mysterious individual or a group that was operating under the name Santoshi Nakamoto. Later, it became popular among a clutch of enthusiasts. Bitcoin is a digital currency that does not involve any third party during the transaction. This means that bitcoin is not tied to any government and has no involvement of any agency which is why you can spend money anonymously. These coins are created by users who lend computing powers to verify other users. This is called ‘ bitcoin mining’. these coins can be bought and sold with the help of AUD as well as many other currencies.

How does bitcoin work?

The transaction value gets included in the blockchain. Bitcoin wallets keep a confidential piece of data which is called private key or seed. They are used to sign transactions and serve as proof that the transactions have taken place from the owner of the wallet. Money can be exchanged without revealing one’s true identity. This is why digital currency is highly preferred for huge transactions especially where you don’t have a sense of trust developed.

What makes bitcoins so popular s the fact that they are digitally signed currencies. This means that there are lines of computer codes and they are digitally signed each time they travel from one owner to another. This type of transactions are anonymous thus they ensure extreme level or privacy. Various tech enthusiasts and libertarians prefer dealing in digital currencies.

The currency has gained significant popularity in recent times. More than 300,000 daily transactions have been recorded daily according to the Bitcoin wallet site. However, the popularity is still low as compared to credit cards or cash. This is why many people or businesses will not accept bitcoin as payment.

How are the kept secure?

Bitcoins are kept safe by a team of tech-savvy people who keep an honest record of the transactions. These transactions are poured into the system into a blockchain which is like a running tally of each and every bitcoin transaction that happens globally. The blockchain also prevents the rogues from spending the same Bitcoin twice. Fun fact is that these miners are rewarded with occasional Bitcoins for their contribution.

Understanding the Blockchain

Satoshi’s vision for creating bitcoin was that we do not need a centralized system like banks or financial institutes to control our money. This is why we need to maintain bitcoin by using cryptocurrency and this is done with the help of a public ledger. This public ledger is commonly known as blockchain. Every transaction made with bitcoin is stored in this ledger. Each transaction requires a sending address and a receiving address.

The transaction also requires some additional security information which ensures that the address is correct. Each and every set of a transaction is stored on a block like a page in the ledger. Once a block is filled with transactions it is ready to be mined by the miners. This is then attached to the previous block which will form a chain of such pages or blocks.

Once a transaction is added to a block and a block is added to the blockchain it can neither be edited nor deleted.

How does bitcoin make money?

There are plenty of ways by which individuals can earn Bitcoin online. Earning bitcoin online will require proper knowledge about cryptocurrency. There are various methods which involve minimal efforts but will also result in minimal returns. Other means of earning will require a certain level of knowledge and expertise in the industry of digital currency. Let us have a look at some of the most popular methods used to earn bitcoin

  1. Micro earnings

Micro-earnings is one of the easiest methods to earn bitcoins. It is also one of the most time-consuming methods as compared to the amount of money you will make. Micro earning websites will pay you in Bitcoins once you have accomplished small tasks. This method will involve tasks like Paid-to click websites, Bitcoin faucets, Micro jobs and much more.

  1. Writing about bitcoins

If you are someone who is passionate about learning about bitcoins or have significant knowledge about the same- you can use this in a way that it can help you to earn bitcoins. The amount of Bitcoins that can be earned by writing about bitcoins varies depending on how lucrative the subject is.

  1. Affiliate marketing

If you regularly update blogs about bitcoins there is potential that you could make money through Bitcoin affiliate marketing. This is a form of marketing where you can get paid a certain percentage of commission for every referral that you bring to an existing Bitcoin business. If your blog is read by enough people it can help you earn a significant amount of Bitcoins.

However, one should always keep in mind that there is no such thing as free bitcoins. You will always have to give something in return in order to earn bitcoins.

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