What is Bitcoin?
Bitcoin, also popularly referred to as BTC, is a digital currency that was created in 2009 after the housing market suffered a huge crash. BTC is not a legal tender, and is not backed or issued by any governments or banks. However, it is very popular because of the promise of lower transaction payments that it offers, in contrast to conventional online payment methods.
BTC is a decentralized currency that does not require a central bank or administrator. It is stored, distributed, and traded using a decentralized ledger system; the blockchain. In addition, it can be used for peer-to-peer transactions, without using intermediaries. It is therefore used as a means of exchange for products, services, and even other currencies.
Who created BTC?
Bitcoin was created by someone who goes by the pseudonym Satoshi Nakamoto. Nakamoto’s true identity remains a mystery.
Nakamoto created the Bitcoin software in October 2008 in a whitepaper titled Bitcoin: A Peer-to-Peer Electronic Cash System. He however did not implement the software until January 2009. It is believed that Nakamoto created Bitcoin because they did not have much confidence in the way the current conventional financial system functions. They believe that financial transactions should not have to involve third parties like the conventional methods do.
Due to its incredible success, Bitcoin has birthed several other digital currencies that are now known as Altcoins.
BTC for Beginners
BTC can be confusing for most people, especially new users. Bitcoin can simply be described as a collection of blocks, nodes or computers. Each block contains a collection transactions, and these blocks make up the blockchain.
All of the computers that run the blockchain contain the same number of blocks and hence, anyone can see all of them being filled with new transactions as they occur live. As a result, the system cannot be cheated.
You can begin using Bitcoin without bothering yourself with all the technical details. All you have to do is install a Bitcoin wallet on your mobile or computer, after which your first BTC address will be generated for you.
To get paid or make payments, you have to share your BTC address; and create more as the need arises. You need to create more addresses as time goes on because you can only use a Bitcoin address once.
Crypto Exchange table
Currency exchange rates in NGN on October 26, 2020
How much is Bitcoin?
Bitcoin can be converted to any currency in the world, because of its growing popularity as a means of exchange. Below are some of the exchange rates for Bitcoin around the world.
Bitcoin to Dollar
1 Bitcoin is equivalent to 11,256.6800 US Dollars, while 1 US Dollar is equivalent to 0.000089 BTC.
Bitcoin to Naira
1 Bitcoin is equivalent to 4,414,467.11 Nigerian Naira, while 1 Naira is equivalent to 0.00 BTC.
0.05 Bitcoin is equivalent to 220,688.58 Nigerian Naira, while 0.001 Bitcoin is equivalent to 4,413.77 Nigerian Naira.
Bitcoin to Pounds
1 Bitcoin is equivalent to 8,718.63 Pound Sterling, while 1 Pound Sterling is equivalent to 0.00011 Bitcoin.
Find more live currency conversion rates HERE
How Does Bitcoin Work?
Bitcoin works by using peer-to-peer technology to carry out financial transactions. As explained earlier, Bitcoin is a collection of blocks. The people who process the transactions in the blockchain are called miners. They are the decentralized authority that keep Bitcoin credible. They are paid by transaction fees made in bitcoin, and the release of new bitcoin keeps them motivated.
New Bitcoin is released at fixed periods, during which the Bitcoin progressively declines. Unlike the conventional centralized banking systems where, in a bid to maintain price stability, new currency is released at a rate that matches the growth in goods; Bitcoin and other decentralized currencies set their release dates in advance, using an algorithm.
The process by which new bitcoins are released is called Mining. Mining involves the solving of computational difficult puzzles. The solution of these puzzles yields a new block which is then added to the blockchain. For solving these puzzles, the miners are paid in bitcoins. This reward is halved after every 210,000 blocks. In 2009, the reward for a block creation was 50 bitcoins, but is now currently at 6.25.
One BTC can be divided into 8 decimal places. The smallest unit is called a Satoshi.
Bitcoin is subject to both praise and criticisms. It has been criticized for the ease of its use in illegal transactions, the thefts that occur from exchanges, the volatility of its price, as well as the huge amount of electricity used by miners. However, despite all of these criticisms, thousands of people still regard it as a credible investment.