Bitcoin what to do with it. The difference between Bitcoin and cash. What is Bitcoin mining

Many Internet users are wondering: what is Bitcoin (bitcoin, btc, btk)? In short, it is a decentralized (which means it cannot be counterfeited or banned) electronic currency, completely protected from wear and tear. In the first 2 years of its existence, the idea did not leave the borders of the World Wide Web. The population simply did not know about the currency or did not understand what Bitcoin was. But in a number of countries in South America and Japan it is already recognized as a means of payment. There, along with the state currency, you can use bitcoin.

Bitcoin what is it? What is Bitcoin? (+video)

Bitcoin what is it in simple words? The first thing you need to know: this is a virtual currency and it functions both on computers and on mobile devices. In addition, the Bitcoin currency does not have a central administrator or any control by people. As a result, this results in significant benefits for users.

The creation of Bitcoin was started in 2008 by a programmer under the pseudonym. The new currency came to world fame just 2 years later, demonstrating a steady upward trend. The name of the creator gave the name to the smallest particle (one ten-millionth part) - satoshi.

How do cryptocurrencies work (using Bitcoin as an example)?

So how does it work? To understand the principle of operation, it is best to compare it with an online bank, payment system or real bank. A transfer in traditional payment systems looks like this:

1. You send the bank a request “I want to transfer 5 rubles from account A to account B.”
2. The bank or server decides whether the payment can be processed and also charges a commission.
3. Money comes from your account to the one you specified.

It follows from this large number inconvenience to the user: server malfunction, legal problems with the bank or any other issues make both payments and, possibly, withdrawal of money from the account inaccessible. Now let’s see what Bitcoin is and how the system works.

The electronic currency bitcoin uses a special algorithm (blockchain), which evenly involves every computer working in the system in operations. At the same time, the devices themselves are in no way connected with each other geographically and can be located in different parts globe. Each device is also used to store information about current funds, everything is encrypted and duplicated many times.

Bitcoin payment algorithm

If we simplify and write it in the “bitcoin for dummies” style, then the sequence of events when sending a payment in cryptocurrency is as follows:

1. You create a request “I want to transfer 5 rubles from account A to account B.”
2. An algorithm decides which computer will process your transaction.
3. The information is “written in” and transferred to all devices in the system.
4. Bitcoins also go to B’s account.

How does Bitcoin work? Bitcoin what is it? All technical details (video)

How many are there?

Many people are interested in how many bitcoins there are in the world. at the moment. Their approximate number is slightly more than 17.5 million (as of February 2019). The system provides for the creation of a new bitcoin by using a special device for computing operations and processing transaction data - . But there is a lot to “print” in this way. new currency If it doesn’t work out, the system has a limit on the number of bitcoins created per day (3600 BTC).

There is a maximum valid number btc, upon reaching which mining (creation of new units of currency) will no longer be possible and it is 21 million. Using simple calculations from current indicators, it is easy to calculate that the increase in the number of virtual coins to the maximum will last for 150 years (approximately 2140), which means the questions “how many bitcoins are there in the world?” and “how many zeros does it have?” You can simply not ask yourself.

What is Bitcoin and what is its practical significance for the end consumer? There is no even theoretical possibility of producing such a quantity of cryptocurrency that this would lead to a drop in its price by long time. A striking example: the US dollar has fallen more than 300 times over the past 100 years due to the emergence of more and more new money. At the same time, only one structure had control over their release. As a result, the investments and savings of millions of people could and could become worthless at any time. In fact, this statement works for every classical currency and payment system.

How is Bitcoin different from electronic and paper money?

There are a huge number of differences between cryptocurrency and regular (fiat) money. Therefore, it is difficult for many to understand why bitcoin is needed. Let's try to figure it out:

• The theoretical impossibility of inflation. Even the creators of the system will not be able to “print” more bitcoins. Their number is set at the level program code. If previously it was possible to create new units of currency (mining), now its quantity has irrevocably stabilized.
• The absence of any intermediaries when carrying out transactions with Bitcoin: no server or other user can either accidentally or intentionally block the transfer or stop the operation of the system - it is not subject to outside influence.
• Decentralization means that the operation of the system is ensured by each computer connected to it separately. In fact, the virtual currency Bitcoin will exist as long as at least one device is working. And now there are tens of millions of them in the world and the number is growing exponentially.
• The absence of a central hub, administration and management means that no legislative or regional prohibitions on Bitcoin Internet money apply. When making transfers within the system, cryptocurrency is not subject to the jurisdiction of any state or individual.
• Very high performance. Even international transfers take up to several minutes, regardless of the time of day and your location. And the commission for one transaction is minimal. In this component, the electronic currency Bitcoin has no equal.

A few more differences

• Records of transfers are public and available to the public. You can track where your money went and where it came from. At the same time, anonymity remains at a high level.
• Easy registration: the Internet currency bitcoin does not require the disclosure of personal data. You don't need to go through complicated procedures to create one. The process takes a few minutes at most. The number of accounts is also unlimited.
• Division into ultra-small shares opens up completely new opportunities for trade and entrepreneurship that were previously unavailable. In most cases, there is no transfer fee at all or less than $0.01.
• No one can block your account under any circumstances. Once created, it will exist as long as the system itself operates.
• No one, not even the state, can take away the money in your wallet. If only you have the key to account, then you have a real one hundred percent guarantee of the safety of your money. The digital currency bitcoin is completely safe.
• The number of transfers, the volume of bitcoins sent or received are simply not available.
• During all the searches in the system, we did not find almost a single critical bug; the client for work is constantly updated. The software is convenient even for those who do not know why bitcoins are needed.
• Soaring prices. No type of fiat money has increased by several thousand times in a decade. Compared to fiat, the Internet currency bitcoin, the rate of which is already over $3,600 apiece (February 2019), was able to easily increase demand and rise in price.

So, what are bitcoins and how to earn them in 2019. There are several ways to receive cryptocurrency:

1. On stock exchanges.

At the moment, there are many options that actually work and are usable:

The main part of the market (about 70%) is held by the btc-usd pair. Most of these services require authorization, which includes sending scanned documents for verification.

2. Exchange services for Bitcoin and other cryptocurrencies

• Telegram bot for Bitcoin
• Telegram for Bitcoin Cash
• Telegram for Ethereum
• Telegram for Litecoin
• Telegram for DASH
• Telegram bot for DOGE (Dogecoin)

They work on a principle completely similar to conventional exchange offices, charging a fixed percentage for the operation. Synchronize the rate several times a day with one of the exchanges listed above. Allows you to purchase btc using almost anyone traditional way payment.

3. Bitcoin -

Sites that give away a small portion of Bitcoin for free. There is no danger to the user in them - the service simply uses your computer for certain operations, such as mixing flows of funds. The amounts that can be received into this account are extremely small, but the process itself will answer questions like “Do you need virtual currency? bitcoin btc?”, “What is Bitcoin and how does it work?” etc.

4. Buying second hand

On forums dedicated to bitcoins, you can find a large number of cryptocurrency owners in your city. It is important to carefully monitor the reputation of the seller and ask which services can be used to promptly verify receipt of funds. This is not difficult even for those who do not know how to work with bitcoins.

A few years ago, the above-mentioned mining (generation of bitcoins) could have been included in the list. But now the popularity of cryptocurrency has reached too high a level. With a limit on the daily rate of created blocks, this makes earning even a meager amount of money in this way an almost impossible task.

Bitcoin cryptocurrency: how can you use it?

And yet, what to do with bitcoins? There are many options for both those who like to make money and investors, as well as those suitable for less risky users who do not know what bitcoins are and why they are needed:

1. Storage

The best answer to the question, what are Bitcoins for? If we analyze the graph of the behavior of the currency price against the dollar, then the unconditional maximum was in December 2017 - $20,000. Virtual money Bitcoin, the rate of which exceeds $3,600 per 1 BTC (February 2019), periodically breaks value records. In addition, all trends indicate that the demand for cryptocurrency will grow very quickly and within 2 years they will displace international payments from the market. Where is the best place to store bitcoins is a controversial question and will be discussed in one of the sections below.

Considering the limit on the amount of currency in the system (21 million), with increasing demand, electronic money Bitcoin will inevitably increase in price. Another thing is that the security requirements for your computer are increasing significantly. Because all transfers in the system cannot be canceled. In fact, it is precisely the original limitation that Bitcoin is secured with. There is basically no chance of your investments depreciating in the long term. It’s worth thinking about how to store them now.

2. Make international payments

Among freelancers and remote workers, paying with bitcoins has become commonplace. It's cheap, reliable and anonymous, which is what he's always been famous for. The operating principle of which is based on decentralization and powerful encryption. In addition, this is a very simple process: even those who have no idea what electronic money Bitcoin is can figure it out in two minutes.

3. Pay for services using Bitcoin

At the moment, btc can be used to pay with Dell, Microsoft and Amazon. Not to mention hundreds of smaller stores and services. In the countries of the European Union, South and North America, as well as in the Far East, you can easily pay for food, clothing and other small goods with them. Bitcoins are in great demand around the world. Even in Russia, Rostov-on-Don, a famous cafe began to accept them.

4. Gamble, make sports bets

Play gambling, place sports bets, use them for trading on stock exchanges, even if they simply do not exist in your country. Here everything is limited only by the imagination of the developers of various projects and the possibilities of cryptocurrency. After all, what is Bitcoin in simple words? The ability to spend money anonymously and quickly.

Disadvantages of Bitcoin

Although Bitcoin has many advantages, the currency also has many disadvantages and it is worth considering them during the dating process:

1. If a virus erases your Bitcoin wallet file (this applies to accounts that are located on local devices) or is able to track your password, your money will not be returned. In addition, this includes a fairly large amount of space taken up. The entire transaction block (beginning of 2019) already occupies more than 200 GB. This is a consequence of how cryptocurrency is structured. Secure synchronization (database update) will also take some time. As a result, this will affect ease of use.
2. If you figure out why Bitcoin is needed and decide to invest money, you may experience a drop in price due to lack of demand. The value of a cryptocurrency is determined by capitalization and demand (and only by them) - this is a consequence of how Bitcoin works.
3. Bitcoin virtual money does not support refunds in case of password theft or fraud. As a result, no one has the power or authority to reverse a Bitcoin transaction unless the person who took it back returns it to you.

Bottom line

Now we have dealt with the question of Bitcoin - what is it - an interesting alternative to money, which has a right to exist. Yes, the currency also has a number of disadvantages, but they are completely offset by a huge list of advantages and the ever-growing demand for cryptocurrencies. Over time, its price and importance in the world will only increase.

Now we understand what the essence of bitcoin is. Tell us your opinion about this digital currency. How long has she come to our world and what will her future be like? Let's share our experiences and help each other with this.

The vast majority of Internet users have heard about the Bitcoin cryptocurrency (abbreviated as BTC) or mining. If you don’t yet know what Bitcoin is and where to get it, then we suggest you read this article to the end. We will tell you about BTC, the most popular methods of mining it, as well as where and how you can buy or sell it.

What is cryptocurrency

Cryptocurrency is a digital currency that has quite a lot of similarities with fiat money (euro, rubles, dollars) and at the same time is very different from them. Having cryptocurrency, you can spend it on purchases, for example, in an online store, or even pay for dinner in a Chinese restaurant. You can also transfer it to another person or exchange it for fiat money using the services of Bitcoin exchangers. All this makes cryptocurrency, including BTC, very similar to the usual money on a debit card.

The main distinguishing feature of cryptocurrency is decentralization digital money, which makes it possible to complete transactions without the participation of third parties. If you create a transaction using, for example, a credit card from any bank, your money first goes to the control node. At this point, the banking system analyzes the request, after which it may decide to confirm the transfer or return the money to the sender’s account. In addition to the fact that such operations take up precious time, the bank charges you a commission. In the case of cryptocurrency, there are no such control nodes, and money changes hands.

What is Bitcoin in simple words

VTS is the very first cryptocurrency that appeared in 2009. For the first time, one could get acquainted with the principle of operation of the peer-to-peer Bitcoin network, on which a certain Satoshi Nakamoto worked, two years before the appearance of the digital currency. Despite the fact that Nakamoto managed to attract the attention of thousands of programmers to his project, no one ever believed in its success. The first transaction using Bitcoin was carried out by the American Hanecz Laszlo, who offered 10,000 BTC to anyone who would bring two Italian pizzas to his house. It is difficult to imagine what emotions Laszlo experienced at the moment when Bitcoin began to rapidly rise in price.

Today, there are hundreds of millions of transactions using cryptocurrency. Therefore, we will answer the question “what is Bitcoin” in simple words - money that has its own exchange rate in relation to another currency, but does not have a physical form.

How new coins of VTS and other cryptocurrencies appear

Unlike government banknotes, cryptocurrency cannot be printed. However, this does not mean that virtual coins appear out of nowhere. Cryptocurrency is a digital object that contains a colossal amount of information that has a cryptographic code. Simply put, this is a kind of virtual card memory having digital recording.

In order to generate new entry, it is necessary to find the only correct solution to the most complex mathematical algorithm. Since even the most smart man is not able to cope with such a task, for these purposes they use computing power computer.

Each cryptocurrency differs from each other not only in the uniqueness of the given algorithm, but also in the complexity of the task, as well as the total number possible solutions, which are subsequently turned into coins. It follows that:

• the total number of coins of any cryptocurrency is limited (BTC - 21 million coins);
• programmers know in advance when the last coin will be mined (BTS - in 2140);
• it is impossible to make any changes to the algorithm;
• coins must be obtained by solving problems;
• The fewer coins remain in the system, the more difficult the mining process becomes.

How to earn bitcoins

Today, the interest in cryptocurrency is so great that inventive people have come up with many ways to get the coveted BTC. As an example, here are the most effective and popular methods:

• cloud mining;
• VTS cranes;
• buying bitcoins.

Let's look at each method in more detail.

Mining

This method of how to earn bitcoins was not only the very first, but also the most effective. The “pioneers” who started mining were exclusively mathematicians and programmers, who watched with interest the project that Satoshi Nakamoto was working on. However, the growing popularity of cryptocurrency has led to the fact that at the moment almost anyone can mine it.

A few years ago, the question of where to get bitcoins was not as pressing as it is today. They could be mined on a regular desktop computer. But since the process becomes more complicated day by day, to mine cryptocurrency you need to have impressive computing power, which the so-called farms have.

A farm is a productive computer that uses the power of several modern video cards to mine bitcoins. We will definitely tell you which devices are suitable for mining digital currencies.

Which video card should you choose?

This is the first question that arises in the minds of people who learn that they can squeeze bitcoins out of their video card. However, before you begin the process of assembling your own farm, you need to pay attention to the cost of video adapters from new lines presented by such giants as AMD Radeon and Nvidia. Their price varies between $300-600, which is undoubtedly expensive for the average citizen. It should also be taken into account that at least 4 such graphic adapters will be required.

Without a video card, creating a farm is impossible, since they are the ones involved in the computing process, for which rewards in the form of bitcoins or satoshis (one hundred millionth of a bitcoin) will be sent to your BTC wallet.

There is ongoing debate on forums about which chips are the most effective in cryptocurrency mining. Some people like AMD more, while others consider Nvidia to be the absolute leader. There is no definite answer, since in the process of mining a particular currency, chips demonstrate completely different results. But overall they are approximately equal. There is a significant difference in the cooling system. The quietest and coolest are video adapters from Nvidia.

The main thing you need to pay attention to when buying video cards is the declared memory and core frequency. The higher these indicators are, the more calculations per second the video adapter will do.

The cooling system is also an important factor on which not only the stability of your farm’s operation, but also its durability will depend. Overheated equipment will not allow the chip to turn on full power, but constantly high temperature will lead to physical destruction of the board.

If you are comfortable with technology, take a video card that has the potential for so-called overclocking. With proper settings, you will be able to increase computing power by up to 40%, which will significantly reduce the time it takes to mine your first bitcoin.

The video cards shown in the table are the most suitable for mining in 2017.

Motherboard

When choosing a motherboard, you need to pay attention to the number of PCIe slots. In order for you to assemble an effective farm, the board must have at least 4 such slots. The ASRock H81 PRO BTC model is considered the most suitable for mining.

power unit

Before you buy a power supply, you will need to calculate how much energy the future farm will consume. Each device has a mark in its characteristics that indicates its energy consumption. Experienced people who know where to get bitcoins and have been successfully mining them for years recommend buying power supplies that have received an 80 Plus Bronze certificate. They are more reliable.

RAM, HHD and CPU

When choosing RAM the main criterion is its speed. The best option for a farm - one 8 GB stick (1600 MHz). For stable operation A hard drive with 60 GB of memory is enough. You need to buy a high-frequency processor that is supported by the motherboard.

Raisers

Raisers are extension cords that are not used when assembling desktop computers. They are needed in order to simultaneously connect all graphics adapters to motherboard. There are two types of risers:

• on trains;
• USB 3.0.

The best ones are those that connect via USB. They are more stable during the mining process.

Programs

Having purchased the equipment and secured it in a special frame, which you can make yourself, you need to download and install operating system. Then register a BTC wallet. You will be assigned a unique address to which bitcoins will be withdrawn.

From the BTS wallet, money can be withdrawn to any other payment system, for example, WebMoney. Recently, WM has a new title sign - WMX (webmoney-bitcoin). This event caused a huge amount of controversy in various forums where issues related to mining are discussed. This reaction is explained by the fact that before WebMoney, Bitcoin did not have support from the largest providers of electronic payment systems.

After installing the wallet, download and install special program for mining, which will allow your farm to start working. However, it should be remembered that independent Bitcoin mining is a rather complex process that requires enormous power. In order to speed up problem solving, most amateur miners gather in groups called pools.

Cloud mining

If you don’t have time to assemble a farm or don’t have enough budget, rent part of someone else’s power and mine military hardware! This is exactly the kind of earning scheme that services offer cloud mining. Owners of such sites, as a rule, large companies who purchase professional equipment in large quantities, ensuring uninterrupted power supply and constant access to the Internet.

On the platform provided for cloud mining, there is a huge list of pools in which people pool rented power for more efficient processing information and problem solving.

Also, some resources offer a referral system passive income or a one-time bonus upon registration. The most resourceful users use the “donated” funds as a startup, thus receiving free bitcoins.

Among the many projects that rent out their own capacity, Telcominer can be highlighted. This is a very young resource that appeared in the spring of 2017. It boasts a rather nice design and rich functionality. After registration, a bonus will be available in the form of 15 GHs of power, which is provided for a month.

VTS cranes

Bitcoin faucet is a site where you can get free bitcoins, or rather part of them (Satoshi) after certain periods of time. In this case, you will have to perform some simple action, for example, enter a captcha. Such resources exist due to advertising, which is placed in videos or banners located on home page site. Some BTC faucets have internal sweepstakes (lottery) and draw additional satoshi among all active users.

1. freebitco. You can “open” the faucet every hour and receive from 45 to 45,000 satoshi.
2. ADBTC. You can withdraw satoshi every 30 seconds. Bonus - fixed (69 satoshi).
3. BonusBictoin. Once every ten minutes you can perform a certain action, for which you will be awarded 50 satoshi.

Now you know where to get Bitcoin without having powerful equipment or funds for investment.

Cryptocurrency exchanges

Most likely, every person who has thought about making money on the Internet at least once in their life has heard about stock exchanges. Many purchase and sale transactions are regularly carried out on these trading platforms, and people who know how to correctly forecast the exchange rate of a particular currency are able to earn a fortune. After digital currency caused a real stir in society, cryptocurrency exchanges began to appear, offering to buy or sell bitcoins on their platform.

Money protected by a cryptographic signature is a rather profitable asset. Selling bitcoins or converting them into other currencies is a small matter, because the demand for them is incredibly high. But the most interesting thing is that the cryptocurrency rate is very volatile. It can plummet and then skyrocket in just a few hours. If you find the right moment, you can buy Bitcoin profitably.

Where to trade is everyone's business. However, when choosing a trading platform, you should pay attention to the following nuances:

• Analytical tools. In order to make money on the difference in Bitcoin exchange rates, you need to learn how to analyze the state of the market. Without the help of auxiliary tools, such as charts, Japanese candles, glass, etc., this will be impossible to do. When choosing an exchange, first of all evaluate its functionality.
• Daily turnover. This information can tell you a lot about the exchange that interests you. The greater the turnover of banknotes per trading platform, the more promising it is for earning money.
• Total amount of cryptocurrency offered. On a proven exchange, which creates ideal conditions for making transactions on its own platform, there are always many traders and those who decided to sell their BTC. This is where you will have more tools to make a profit, which will directly depend on how much you are willing to invest.
• Help Desk. You should not waste time working with a service whose support service does not communicate with customers or resolves issues very slowly. Better save your nerves and money, because there are many sites where you can buy Bitcoin quickly and without all sorts of pitfalls.

How to get “real” money for mined cryptocurrency

We looked at the main ways you can earn bitcoins, the rate of which is constantly growing. Today the cost of 1 military vehicle varies between $2300-2500. But how to hold honestly earned money in your hands? To do this, we will need to use the services of Bitcoin exchangers.

In order to exchange cryptocurrency for fiat money, you need to have a debit card from any bank or electronic wallet, registered in one of the payment systems. Then we go in search of the Bitcoin exchange itself, of which there are a lot today. Before converting bitcoins to another currency, analyze the resource you like, study all the conditions for making transactions, read reviews of people who have used the services of this site. Also pay attention to the rate and commission so as not to sell yourself short. Let's look at the most popular resources among users that work with payment systems such as Yandex.Money, PayPal, QIWI, WebMoney:

• X-PAY;
• 60SEC;
• XCHANGE;
• EXMO;
• PROSTOCASH;
• WMGLOBUS;
• BLUE;
• LIVECOIN;
• BESTCHANGE;
• ALFACASHIER.

All these services have been providing their platforms for currency exchange for more than one year and are the most reliable. And also they have very user-friendly interface, which even a beginner who doesn’t know how to cash out bitcoins can quickly figure out.

Cryptocurrency can be sold without involving third parties who charge a commission for their services. However, in this case, no one will give you any guarantee that the transaction will be safe. Despite the fact that Bitcoin is the most secure currency, sometimes it is better to play it safe.

Not so long ago, in my next weekly report on my investments, I talked about it as a new promising investment instrument. In just the first week of trading Bitcoin, I earned more than $200 with a deposit of $800, i.e. 25% per week. For the sake of fairness, I note that I was a little lucky, because... I bought Bitcoin coins during a strong upward price trend (the price rose above $1000). After the publication of the report, questions like:

• What is Bitcoin?
• Is it too late to invest in Bitcoin?
• how to make money on bitcoins?
• where to get\buy bitcoins?
• how to buy bitcoins on and?

I promised to answer these and other questions detailed review, which you are reading now. So let's start with what exactly are bitcoins? This question was the most common among readers.

Bitcoin - what is it?

I've been running this blog for over 6 years. All this time I regularly publish reports on the results of my investments. Now the public investment portfolio is more than 1,000,000 rubles.

Especially for readers, I developed the Lazy Investor Course, in which I showed step by step how to establish order in personal finances and effectively invest your savings in dozens of assets. I recommend that every reader complete at least the first week of training (it's free).

Literally, bitcoin is a “bit” unit of information, a “coin” coin. Essentially, Bitcoin (officially abbreviated as BTC) is an electronic payment system(currency) that does not have a single information center, so the system does not have a single owner. We can say that the cue balls belong to those who use them. By the way, most often in the bitcoin network they call it cue balls.

The electronic cryptocurrency Bitcoin was created in 2009 (development began in 2007), by a programmer or team of programmers with the pseudonym Satoshi Nakamoto (apparently a Japanese name). In 2009, Satoshi published the source code of the system and this event can be called the beginning of the electronic payment system.

Currently there are more than 10 electronic currencies with a similar operating mechanism, they are also called forks (answer). I will list the most promising forks in terms of earnings and investments:

• LiteCoin (currently the LTC rate fluctuates in the range of $25-40);
• Namecoin (now the NMC rate fluctuates in the range of $5-10);
• PPcoinn (currently the PPC rate fluctuates in the range of $3-5).

The cost and stability of the rates of all existing cryptocurrencies directly depends on bitcoins, so in this article I will only talk about bitcoins.

Bitcoin for dummies

In order to fully understand what bitcoin is, I will list the main differences between bitcoins and conventional money:

• Bitcoins are not backed by anything

BTC are not debt obligations (like traditional money) and, in fact, are not backed by anything material. The price of bitcoins directly depends on supply and demand, i.e. How much do people need currency? A parallel can be drawn with gold, the price of which directly depends on demand. If at some point no one needs gold, then the price for it will collapse, however, to complete zero the price will not fall, because It’s still metal and you can make something out of it. If there is no demand, nothing can be made from Bitcoin, so its price could theoretically fall to zero.

• No single center

As I said above, all payment system data is stored in open source on the media of system users. There is no system regulator (such as the central bank) who could influence the price of the currency, the quantity of new units issued, and other factors.

• Limited amount of currency

The source code of the system is programmed in such a way that the maximum number of coins in the system is initially known (21 million coins). Not only the maximum quantity is programmed, but also the dynamics of the issue (the release of new coins), which is now 25 coins every 10 minutes. The coins are distributed among the so-called miners, which I will talk about a little later. Every 4 years, emissions are halved.

Thus, the payment system has a deflationary structure, which contributes to a constant increase in the price of the cue ball. This is what the Bitcoin emission growth graph looks like, according to which the emission will end in 2033, although it seems to me that this moment will come earlier.

If we assume that the governments of large countries will not ban Bitcoin, then based on the deflationary model, the rate will only increase. When the total number of coins reaches 21,000,000, coins can technically be divided to the eighth decimal place, so the end of the issue does not mean the end of the development of the payment system.

• No transaction fees

Since the system has no owner, there is no one to pay the commission for transfers between wallets. The system allows you to pay a voluntary commission to speed up transactions.

• Complete anonymity of bitcoins

Despite the fact that the system is open source and anyone can trace any transaction with btc, the wallet system is completely anonymous. Any user of the system can have an unlimited number of wallets on their computer, and they will have absolutely different numbers. You can only find out who the owner of a particular wallet is from the owner himself.

The wallet number is a long string of about 34 characters (letters and numbers). The wallet itself can be stored on a computer, portable storage device or in an online service.

The main disadvantages of bitcoins

• There is no single regulator

Since there is no single center, there is no way to cancel a transaction with bitcoins.

• Difficulty to use

For most people who are far from Internet technologies, the electronic system of bitcoins is too complex and confusing, this slows down the spread of bitcoins to the masses.

• Risk of becoming a banned currency

Now that all governments are striving for total control over their citizens, any anonymous money is doomed to be banned. Sooner or later, this will happen to Bitcoin as well. There is already a reason for closure; there are several stores on the Internet that openly sell weapons and drugs for bitcoins. After the ban on cue balls, the exchange rate will most likely drop significantly, but the development of the system will not stop there, the cue balls will simply go underground, where they will also be popular among users who value complete anonymity.

There are only two ways to make money on bitcoins:

• Earning money from bitcoin mining

Mining ( mining- mining) - mining of the virtual currency Bitcoin using the computing power of a computer. This process is necessary to ensure the functioning of the network; it is the miners (virtual currency miners) who ensure the anonymity, security and efficiency of transactions in the bitcoin system. Earnings for miners are new coins in the system (25 coins every 10 minutes), which are distributed among the miners. Currently, calculations in the bitcoin system are so complex that using regular computer for mining will only bring losses (electricity, depreciation, etc.). In order to combine computing power, miners are united into pools, the profits of which are divided in proportion to the volume of calculations made.

Nowadays, for mining, it is most profitable to use special ASIC devices, which were created specifically for mining and cannot do anything other than that. As a person far from the anatomy of computer configurations, I will not go into details of this method of making money on bitcoins. Perhaps later I’ll write an article on mining.

• Making money trading bitcoins

This method can be divided into two: passive investing in bitcoins and active speculation on the exchange rate. The first method is to simply buy bitcoins and preserve them under the mattress, in the hope that in a couple of years they will be worth tens of times more than now. By the way, I recently read an article by a leading analyst at Bank of Amerika, who conducted a study and claims that the price of bitcoin will only increase to at least $300 (currently the price for 1 BTC=$2500).

The second way to make money trading bitcoin involves active trading/speculating on the bitcoin exchange rate. For these purposes, you can use the eToro () service. The service has an intuitive interface; you can set stop loss and take profit, and copy successful managers trading cryptocurrencies. It is possible to try trading on a demo account without investments.

This option is very similar to trading currencies on Forex; by the way, you can even trade on the BTC-E.nz exchange using the MetaTrader 4 trading platform. Namely, earnings from trading Bitcoins are the most profitable for private investors, because does not require large investments. You can start investing with $100. Now let's figure out where you can get/buy bitcoins.

Where can I get bitcoins?

The answer to the question - Where to get bitcoins depends on which option for making money from trading you choose. For lazy investors who want to safely invest money in bitcoins for a long time, the option with exchangers is suitable. First, you will need to create a wallet. Lately, I have been constantly hearing about bitcoin wallets being hacked, so I recommend storing your wallet only on an independent storage device, so you can protect your bitcoins as much as possible.

In order to create a wallet, you need to download the MultiBit client program to your computer from. Next, launch the MultiBit program and create a new wallet. You can buy bitcoins like regular money at exchangers. I recommend using only trusted exchangers, such as.

If you have experience in Forex trading and have free time, then you can try trading bitcoins on the btc-e.com exchange. I would like to warn you in advance about the potential possibility of an exchange scam. Legally, the activity of the exchange is not formalized in any way; in the contacts section there is no information at all, you can only send a request. So, I don’t recommend keeping a large amount of money on the stock exchange. And although the exchange is the largest in the Russian-speaking segment, it is better to withdraw your profit and buy real bitcoins with it in exchangers. In principle, you can withdraw bitcoins to your wallet from the exchange itself, but this cannot always be done, because The exchange's reserve of bitcoins is significantly limited.

Well, that’s probably all you need to know in order to start making money on bitcoins. If I missed something, ask in the comments. In the meantime, to consolidate the material, I recommend watching a rather interesting seminar on the bitcoin system.

Profit to everyone!

Bitcoin- an electronic currency with a market capitalization of $9 billion, which exceeds the GDP of many countries. At the same time, only half of the btc coins have been mined, and the market value of 1 btc = $410 and will only grow upward!

According to analysts, the last Bitcoin will be mined by 2040, and the price of 1 unit could grow by more than 1,000%. And by this time, many countries will have official trading for btc.

The whole story about Bitcoin in 9 minutes

The currency was created by Satoshi Nakamoto in 2008, but it has been on sale online since 2009 at $0.2 - $0.5 per piece. And the people who bought bitcoins then became rich.

A notable example is student Christopher Koch, who decided to buy $27 worth of Bitcoin in 2009 for a university topic. But he only remembered them in 2013, when 1 bitcoin cost $1,000, and his investments rose in price to $886,000.

Now you can buy everything with bitcoins: food, things, cars, houses, university education, etc. In general, from pizza to space flight.

Bitcoin price chart for all time

If you look closely, the currency has had a sudden rise, which is associated with the spread of Bitcoin around the world. However, after the $1,000 level, China banned the sale of Bitcoins, which led to a sharp drop in the price to $200.

But the most important thing is that the currency managed to double in price in 2015 and already costs $400, thanks to the fact that more and more more people people are interested in this + mining new bitcoins is becoming harder.

If you understand in detail what Bitcoin is, then it is big and unique code in one block, which is not repeated, but is a continuation of the previous found block of information.

And for every extracted new block, the miner receives 25 BTC. Previously, mining was carried out using the power of a video card. Currently I use ASIC (high performance special computer for mining bitcoins).

If you now try to mine a block using a Radeon video card (the most productive of the CPUs), it may take about 5-7 years. Therefore, the equipment gets better and better every year. And in 2040 the last block with the code will be mined.

However, if you are interested in how to quickly earn bitcoins using mining, I recommend reading all the ways -.

Today all network users know about cryptocurrencies that can be used to pay on the Internet, and if you have not yet learned about cryptocurrency, we have it. And although at the moment there are already more than a dozen different electronic currencies, an express analysis of which you can see at the link, yet the palm of leadership among virtual money is confidently held by the very first cryptocurrency - bitcoin. In 2009, when Bitcoin appeared, the cost of one virtual coin was $1, and now its current value is .

What does Bitcoin look like?

Since Bitcoin is virtual currency, it looks not like the usual paper money and coins, but like electronic file. Each monetary unit is a numerical function that satisfies the conditions specified in the original system code. Therefore, to understand what Bitcoin is, it is enough to see its code written in the Wallet.dat file.

To understand in detail what the essence of Bitcoin currency units is, you need to understand the processes of hashing and cryptography. But today, beginners do not need to learn these complex concepts, since all processes are running software, and in order to earn and use bitcoins, it is not necessary to delve so deeply into programming.

It is enough for network users to know that Bitcoin, which can be used to pay on the network, represents the amount source code(function hash) – the so-called Bitcoin address or public key that can be transferred to another user. This hash sum is calculated automatically from the original key of the currency, and in reverse side this process doesn't work. Therefore, any participant in the Bitcoin system can publicly announce his public keys, but until he himself transfers them to another user, no one will be able to calculate their source code, and therefore gain access to his cyber coins.

Bitcoin coins

Despite the fact that Bitcoin is a cyber currency, today it would be a mistake to say that this money is only available in digital form. The fact is that there are already quite tangible Bitcoin coins made of metal. These coins are issued by both individuals and companies with their own Bitcoin wallets.

The process of issuing such coins is as follows:

1. A coin of original design is cast from any metal
2. The denomination is applied to one side of the coin - 0.1 btc, 0.5 btc, 1 btc, 10 btc, etc.
3. Then, for each coin, a unique Bitcoin address is generated, which is applied to it and covered with a hologram
4. The first 8 characters of the public key are written on top of the hologram so that the buyer of the coin can verify its authenticity.

Bitcoin metal coins are simply carriers of unique Bitcoin addresses and in fact have no advantages over Bitcoin in electronic form.

Issue of new bitcoins

One of the main differences between Bitcoin and other financial systems is decentralization. This means that the system has neither an owner, nor administrators, nor centralized control. The owners of Bitcoin are all participants in the system, and each network user can theoretically issue this currency.

Emission, or more precisely, mining of Bitcoin. In order to generate a new block of bitcoins containing 25 coins, complex calculations are performed using special software to find the source code that would fit the conditions of the system. In simple terms, we can say that the codes of new Bitcoins are simply selected by brute force random numbers and comparing them with the original conditions.

Bitcoin mining on a computer and ASIC: profitability of “farming” activities in 2017-2018

At the very beginning of the system’s existence, the process of how bitcoins were created (mining) was quite simple and fast, and even users with a PC could mine new blocks medium power. But the more Bitcoin is mined, the more difficult it becomes to find new source keys.

To find the right one hash function, today very large computing power is required.

Therefore, people involved in the emission (mining) of Bitcoin equip mining farms, which use specialized powerful equipment, which is intended for the sole purpose of generating new Bitcoin blocks.

How to mine bitcoins in 2018: in a pool or on your own?

Blockchain technology

The entire Bitcoin system works using blockchain technology. This means that absolutely all transactions made with each Bitcoin block are entered into an open database, and every user of the system can track them. All blocks in the blockchain are interconnected in a continuous chain, and it is impossible to make changes to blocks already recorded in the database. Database registers are stored not in one place, but on thousands of user computers that are participants in the system. The register is constantly automatically updated and supplemented with data on new mined Bitcoin blocks and completed transactions.

At first glance, such openness and transparency of all transactions provides enormous opportunities for fraud, but in fact, everything is exactly the opposite.

Since the database is decentralized and is located on hundreds of thousands of computers at once, in order to hack it, you need to immediately have access to at least half of all PCs of system users, which is impossible in principle. And that is why it is impossible to spend the same Bitcoin twice - a record of the transaction will instantly appear in the registry, and the user will no longer be able to reuse the same Bitcoin address.

Advantages of Bitcoin cryptocurrency

Popularity Bitcoin cryptocurrency due to a number of advantages of this cyber money over bank non-cash payments. And the most important “advantages” of bitcoins are the following:

• No transaction fees
• Complete anonymity of both parties to the transaction
• A stable and steadily growing rate of cyber currency, due to the fact that Bitcoin is not tied to the dollar, the euro, or any other currency
• Transparency of transactions and the ability to track all transfers of each bitcoin
• High transaction speed
• Inability for the payer to revoke the transaction after confirmation of the transfer
• Very high security of the system and its almost complete invulnerability to hacker attacks.