Bitcoin is one of the digital money that was found to become prevalent in January 2009 and occurred after the housing market crash. The real identity of the organization or a person who created the idea of Bitcoin is still unknown. The difference between other online payment methods and Bitcoin is that the transaction charge is very low and is not operated by a government authority but by a decentralized authority. Bitcoin becomes a new form of currency that involves trustless payments on the web, requiring less amount and no trust between the buyer and seller, making the users confirm transactions and messages using a tool called public-key encryption.<\/p>\n
A type of Cryptocurrency means a method of digital or virtual currency that is Secured by Cryptography. Most of the Cryptocurrencies are the decentralized network that works based on blockchain technology. The blockchain technology can be called as a distributed ledger made by a different system of computers. And these are not legally issued by the government authority.<\/p>\n
Bitcoin can be considered a collection of computers that run the Bitcoins code and store its blockchain<\/a>. A blockchain contains a collection of blocks, and each block has a collection of transactions. The computers that run these blockchains have an identical list of blocks, and all the transactions can be seen as these blocks are being filled with new Bitcoin transactions. The person, whether he runs a Bitcoin or not, can see all the transactions. So it is very transparent no one can cheat this system.<\/p>\n Bitcoin tokens are stored using both public as well as private keys. Keys represent long strings of numbers and letters connected through the mathematical encryption algorithm used to create them. This public key acts as the link or address using which the users around the world can send and buy Bitcoins. The users do not have to disclose the identities to any third party. That is, the exchange of Bitcoins involves pseudonymity.<\/p>\n <\/p>\n The working of Bitcoins<\/strong><\/p>\n Bitcoin is a digital form of money or currency that employs peer\u2013to\u2013peer technology to do instant transactions or payments. Peer\u2013to\u2013peer technology is the method of the transacts of data, payments, or other information without a central authority’s involvement. It involves interaction between people or groups, often used in currency sharing and computer networking.<\/p>\n An individual or group with the computing power and takes part in the Bitcoin network comprises miners or nodes. These miners that can process the transactions will get some rewards and transaction fees paid in Bitcoins. These miners are the decentralized authority that can book keeps the credibility of Bitcoins. The system involves releasing new Bitcoins to these miners at a fixed, but periodically declining rate, which is the main difference between centralized banking systems and the Bitcoin system. In a centralized banking system, the currency is released based on the rate matching the growth of good, to adjust and balance the price stability. In the Bitcoin process, a decentralized system enables the release rate to be set ahead of the time and based on an algorithm.<\/p>\n There is another process called Bitcoin mining<\/a> and is the process by which the Bitcoins are released into circulation. The process involves the detection of a new block computationally, which is then added to the blockchain.\u00a0<\/strong><\/p>\nHow can we buy Bitcoin?<\/h3>\n