Important Things To Consider Before Buying Bitcoins

Because virtual currencies have a unique nature, they offer many advantages over traditional currencies. Over the past few years, the world of digital currency has seen many positive changes. There are many cryptocurrencies, but Bitcoin is one of the most popular. In this article, we are going to take a look at some of the most prominent benefits of paying with Bitcoin. Read on to learn more.

1. User autonomy

For many users, digital currencies offer much more freedom than traditional currency. People can better control how they can spend their money. The good thing is that they don’t have to deal with intermediaries like the government or the bank.

2. Prudence

Another advantage is that things purchased with bitcoins are discrete. Only the user can publish their Bitcoin transactions. Also, transactions don’t have their name next to them. In addition, these transactions are almost impossible to trace.

Essentially, each transaction has a different Bitcoin address. But that doesn’t mean these transactions can’t be traced. So, if you don’t want others to know where you spent your money, you can use cryptocurrencies to make payments.

3. Peer-to-peer Focus

Another great advantage of the Bitcoin payment system is that it is based on peer-to-peer communication. In other words, users can receive and send payments without getting approval from any authority. Payments can be made within seconds as long as the user is connected to the Internet.

4. No bank fees

Unlike traditional fiat currencies, Bitcoin does not charge deposit, overdraft or minimum balance fees. So you don’t have to worry about account maintenance fees or balance.

5. Low transaction fees

As a rule, purchases abroad and regular bank transfers are accompanied by exchange costs and fees. Since cryptocurrencies do not require government involvement or any intermediary institutions, transaction costs are quite low. If you are a traveler, this can be a great advantage for you. In addition, Bitcoin transfers are very fast, eliminating the need for authorization and long waiting periods.

6. Mobile payments

Like any online payment system, cryptocurrency users can make payments through their mobile phones when they are connected to the internet. That way, they don’t have to go to the bank to make a purchase. Also, you don’t need to reveal your personal identity to complete the transaction.

7. Availability

Sincere users can receive and send bitcoins using their computer or smartphone, there is no need to involve a traditional bank or other authority. In addition, users do not need to use their credit cards to make payments. Therefore, Bitcoin provides more affordability than other options you can try.

In short, these are just some of the main advantages of making payments with Bitcoin instead of using traditional means of payment. Hopefully, this article will help you better understand cryptocurrencies.

What is Bitcoin Black?

Bitcoin Black is basically the people’s cryptocurrency, for the people. It will be adopted for use as a peer-to-peer payment system that puts the power back to the people.

When we talk about Bitcoin, Bitcoin has failed, the real value comes from actually using the ecosystem and empowering people. Bitcoin transactions are slow and expensive, and it can be said that Bitcoin is somewhat centralized. Bitcoin captures people’s power because it is heavily manipulated and through cycles that scare participants away from cryptocurrency in general.

People buy bitcoins to get rich, not to be involved in the ecosystem. The elite one percent are using bitcoin and creating frustration by strategically increasing the price and attracting entry to dream of riches and dumping coins for their own benefit. In fear of adoption. Bitcoins are fully controlled, pumped and manipulated at will for various reasons.

Bitcoin Black focuses on solving these problems as the coin is a cryptocurrency with a fair distribution. 1 million wallets were released prior to the IEO, all of which will go to community groups voted by the community to move the project forward with a focus on fair distribution, mass adoption, usability, education, ease of access, simplicity and community.

The goal is to make it a true decentralized autonomous network that puts power back to the people. He does not belong to a group, but belongs to many branches of the community.

Distribution of coins

Bitcoin Black initially aims for at least 1 million wallets, with no more than 0.5% of the supply owned by a single founder, making it a truly decentralized cryptocurrency.

The project has a presale of 2.5% of the total supply, which is almost 900 million coins.

If we look at the IEO, the 7.2 billion IEO coins will be allocated to several public funds that will help the community to advance the project in the future.

Opposite means for manipulation (about 5%). The part used for the stability control fund to eliminate the possibility of early manipulation at low volume and maintain the stability of the currency.

Finally, the reward for introducing the app will be 14.4 billion coins.

Introducing 30 million members with an increasing rate of new users. A method of attracting a coin to every school yard / university / workplace and community.

General offer

The maximum supply is 36 billion coins.

Awards

Members who help share the Airdrop can receive 3.6 billion coins.

A simple one-click social sharing platform. Share a social message that includes an introduction to the encrypted video and a download link that will allow your friends to download it. The platform is currently active and working well.

Innovation

The best innovation is free transactions. You can send bitcoin black to anyone for free. Transactions are instant and you can send money as easily as sending a text.

Wallets are readily available and very easy to use.

Conclusion

Bitcoin Black has a fairly massive distributed currency with a wide spread of supply, which will lead to less volatility due to synchronized pumps and dumps and lead to a more stable price. Black Bitcoin will be the next Bitcoin. You can register for the airdrop by clicking here. I wish someone had included me in the bitcoin airdrop back in 2008. Bitcoin Black is going to change lives and we want to tell as many people as possible about it.

Cryptocurrency has become not only the fastest way to transfer money, but also a new entity to trade and make money with, apart from stocks and other commodities. While you can sell and buy bitcoins directly, you can also use bitcoin trading exchanges to continue trading the cryptocurrency. There are many exchanges where it is safe and secure to trade bitcoins and many advanced services are also offered to the customers. As a cryptocurrency investor or trader, you can choose any of the exchanges for your comfort. However, it is recommended that you look at the reviews of some before giving up on one. Below is a quick overview of the best Bitcoin exchanges around the world.

CoinBase: This is probably one of the most well-known and largest exchanges for dual-trading bitcoin directly and via wallet. CoinBase was founded in 2012 through venture capital search Y-Combinator and has grown rapidly since then. It has many beneficial services such as multiple deposit and cash withdrawal options, instant money transfers between two CoinBases, a wallet with multiple signature options for safer transfers, Bitcoin deposits are insured against any loss, etc. CoinBase has a wide selection of payment partners Europe and the US, which seamlessly allow transactions to be made through them. It has relatively low transaction fees and offers Bitcoin trading along with plenty of altcoin trading.

CEX.IO: One of the oldest and most famous exchanges, founded in 2013 in London as a Bitcoin trading exchange as well as a cloud mining facility. Later, the mining power increased so much that it took up almost half of the network’s mining power; however, it is now closed. “CEX.IO” allows customers to expand a much larger volume of bitcoin transactions and also make available bitcoins instantly at the requested price. However, this exchange charges a slightly high exchange amount, but this is compensated by the security and facilities that allow you to make multi-currency transactions (dollars, euros and rubles) for the purchase of bitcoins.

Bitfinex: This is one of the most advanced trading exchanges and is especially suitable for experienced cryptocurrency traders. With the high liquidity of Ethereum as well as Bitcoin, this exchange has better options such as leverage, margin financing and multiple order trading. Apart from this, Bitfinex offers customizable GUI features, many order types like limit, stop, trailing stop, market, etc. This exchange also offers around 50 currency pairs that can be traded and with easy withdrawal for everyone. One of the largest exchanges in terms of trading volume, Bitfinex offers a pseudonym for transactions and only requires identification for some services. The only downside to this exchange is that it does not support buying Bitcoin or any other altcoin through fiat transactions.

Bitstamp: It was founded in 2011 and is the oldest exchange offering cryptocurrency and bitcoin trading. The most respected because, despite being the oldest, it has never been under threat until recently. Bitstamp currently supports the four currencies Bitcoin, Ethereum, Litecoin and Ripple and is also available with a mobile app apart from the website for trading. It has excellent support for European users or traders who have their account in Eurobanks. Security is advanced and cold type, which means coins are stored offline. So you can say that hacker penetration is completely impossible. Last but not least, its sophisticated user interface suggests that it is not intended for beginners but for professionals, and it offers relatively low transaction fees.

Kraken: This is one of the largest exchanges for Bitcoin trading in terms of liquidity, crypto trading volumes in Euros, and trading performance in Canadian dollars, USD and yen. Kraken is the most respected exchange that has steered through the tumult of cryptocurrency trading and has managed to keep its customer base safe regardless of other exchanges being hacked at the same time. With more than 14 cryptocurrency trading facilities, the user can deposit both fiat and cryptocurrency along with the same ability to withdraw funds. However, it is not suitable for beginners, but it has better security features and low transaction fees compared to CoinBase. The most important factor for Kraken is that it enjoys the trust of the community and was the first to show volumes and prices on the Bloomberg terminal.

Bitcoin (BTC) is a new type of digital currency with cryptographic keys that is decentralized on a network of computers shared by users and miners around the world and is not controlled by a single organization or government. It is the first digital cryptocurrency to gain public attention and is being accepted by a growing number of merchants. Like other currencies, users can use the digital currency to purchase goods and services online, as well as in some physical stores that accept it as a form of payment. Currency traders can also trade bitcoins on bitcoin exchanges.

There are several main differences between Bitcoin and traditional currencies (such as the US dollar):

1. Bitcoin has no centralized authority or clearinghouse (such as a government, central bank, MasterCard or Visa network). The peer-to-peer payment network is operated by users and miners around the world. Currency is anonymously transferred directly between users over the Internet without going through a clearing house. This means transaction fees are much lower.
2. Bitcoin is created through a process called “Bitcoin mining”. Miners around the world use mining software and computers to solve complex Bitcoin algorithms and approve Bitcoin transactions. They are rewarded with transaction fees and new bitcoins generated by the solution of bitcoin algorithms.
3. There is a limited amount of bitcoins in circulation. According to Blockchain, as of December 20, 2013, there were approximately 12.1 million Bitcoins in circulation. The difficulty of mining bitcoins (solving algorithms) gets harder as more bitcoins are generated, and the maximum amount in circulation is limited to 21 million. The limit will not be reached until approximately 2140. This makes bitcoins more valuable as more people use them.
4. A public ledger called “Blockchain” records all Bitcoin transactions and shows the respective holdings of each Bitcoin owner. Anyone can access the public ledger to verify transactions. This makes the digital currency more transparent and predictable. More importantly, transparency prevents fraud and double spending of the same bitcoins.
5. Digital currency can be purchased through bitcoin mining or bitcoin exchanges.
6. Digital currency is accepted by a limited number of online merchants and some brick-and-mortar retailers.
7. Bitcoin wallets (similar to PayPal accounts) are used to store bitcoins, private keys and public addresses, and to anonymously transfer bitcoins between users.
8. Bitcoins are not insured or protected by government authorities. Therefore, they cannot be recovered if the private keys are stolen by a hacker or lost on a failed hard drive, or due to the shutdown of a Bitcoin exchange. If the private keys are lost, the associated bitcoins cannot be recovered and will go out of circulation. Follow this link to learn about bitcoins.

I believe Bitcoin will gain more public acceptance because users can remain anonymous when buying goods and services online, transaction fees are much lower than credit card payment networks; the public ledger is available to anyone, which can be used to prevent fraud; the currency supply is limited to 21 million and the payment network is managed by users and miners instead of a central authority.

However, I don’t think it’s a great investment tool because it’s extremely volatile and not very stable. For example, this year the price of Bitcoin rose from around $14 to a peak of $1,200 before falling to $632 per BTC at the time of writing.

Bitcoin rallied this year because investors assumed the currency would gain wider acceptance and rise in price. The currency fell 50% in December because BTC China (the largest Bitcoin operator in China) announced that it could no longer accept new deposits due to government regulations. And according to Bloomberg, China’s central bank has banned financial institutions and payment companies from processing bitcoin transactions.

Bitcoin is likely to gain more public acceptance over time, but its price is extremely volatile and highly sensitive to news such as government regulations and restrictions that can negatively impact the currency.

Therefore, I do not advise investors to invest in Bitcoin unless it was purchased at a price of less than USD 10 per BTC, because this will allow a much larger margin of safety.

Otherwise, I believe it is much better to invest in stocks that have strong fundamentals and excellent business prospects and management teams because the underlying companies have intrinsic value and are more predictable.

Disclosure: Viktor Liang has no positions in Bitcoin and has no plans to change his position in the next 72 hours.

Introduction: Invest in cryptocurrencies

The first cryptocurrency to emerge was Bitcoin, which was built on blockchain technology and was probably launched in 2009 by a mysterious man named Satoshi Nakamoto. At the time of writing this blog, 17 million bitcoins have been mined and it is estimated that only 21 million bitcoins can be mined. Other most popular cryptocurrencies are Ethereum, Litecoin, Ripple, Golem, Civic and Bitcoin hard forks such as Bitcoin Cash and Bitcoin Gold.

Users are advised not to put all their money in one cryptocurrency and try to avoid investing at the peak of the cryptocurrency bubble. It was seen that the price suddenly fell down when it was at the peak of the crypto bubble. Since cryptocurrency is a volatile market, users should invest an amount that they can afford to lose as no government can control cryptocurrency as it is a decentralized cryptocurrency.

Steve Wozniak, co-founder of Apple predicted that Bitcoin is the real gold and in the future it will dominate all currencies like USD, EUR, INR and ASD and become the global currency in the coming years.

Why and why not to invest in cryptocurrencies?

Bitcoin was the first cryptocurrency to emerge and since then around 1600+ cryptocurrencies have been released with unique features for each coin.

Some of the reasons I came across and would like to share, cryptocurrencies were built on a decentralized platform – so users don’t need a third party to transfer cryptocurrency from one destination to another, unlike fiat currencies where the user needs such a platform. like a bank, to transfer money from one account to another. Cryptocurrency built on very secure blockchain technology and almost zero chance of hacking and stealing your cryptocurrencies unless you share your important information.

You should always avoid buying cryptocurrency at the peak of a cryptocurrency bubble. Many of us buy cryptocurrencies at their peak hoping to make a quick buck and fall prey to the hype of the bubble and lose our money. Users are better off doing a lot of research before investing. It is always a good idea to invest in multiple cryptocurrencies rather than just one as few cryptocurrencies have been seen to grow more, some on average, when other cryptocurrencies fall into the red zone.

Cryptocurrencies in the spotlight

In 2014, Bitcoin holds 90% of the market, with other cryptocurrencies holding the remaining 10%. In 2017, Bitcoin still dominates the crypto market, but its share has fallen sharply from 90% to 38%, while altcoins such as Litecoin, Ethereum, Ripple have grown rapidly and captured most of the market.

Bitcoin still dominates the cryptocurrency market, but it is not the only cryptocurrency to consider when investing in cryptocurrency. Some of the main cryptocurrencies you should consider are:

Bitcoin

Litecoin

Pulsation

Ethereum

Throne

Civil

Golem

Monero

Where and how to buy cryptocurrencies?

While it was not easy to buy cryptocurrencies a few years ago, now there are many platforms available to users.

In 2015, there are two main bitcoin platforms in India – Unocoin wallet and Zebpay where users can buy and sell only bitcoins. Users should only buy bitcoins from their wallet, not from another person. There was a difference in the buying and selling rate and users have to pay some nominal fee to complete their transactions.

In 2017, the cryptocurrency industry grew dramatically and the price of Bitcoin rose spontaneously, especially in the last six months of 2017, which made users look for alternatives to Bitcoin and crossed 14 lakhs in the Indian market.

As Unodax and Zebpay are the two major platforms in India which dominated the market with 90% market share – which only dealt with Bitcoin. This allows other entities to develop alongside other altcoins and has even led Unocoin and others to add more currencies to their platform.

Unocoin, one of India’s leading cryptocurrency and blockchain companies, has launched an exclusive UnoDAX Exchange platform for its users to trade multiple cryptocurrencies apart from trading Bitcoins in Unocoin. The difference between both platforms was that Unocion only provided instant buying and selling of Bitcoins, while on UnoDAX, users can place an order for any available cryptocurrency and if it matches the recipient, the order will be executed.

Other major exchanges available for cryptocurrency trading in India are Koinex, Coinsecure, Bitbns, WazirX.

Users have to open an account with any exchange by registering with email id and submitting KYC details. Once their account is verified, you can start trading the coins of your choice.

Users should do their research well before investing in any coins and avoid getting trapped in the cryptocurrency bubble. Users should research the exchange’s trust, transparency, security features, and more.

All exchanges charge some nominal fee for each transaction. There are two types of payments – creator fee and baker fee. In addition to the transaction fee, there is a transfer fee to be paid if you want to transfer your cryptocurrencies to another exchange or to your personal wallet. Prices are purely coin and exchange dependent as different exchanges have a price difference module for coin transfers.

Major altcoins other than Bitcoin

As mentioned above, Bitcoin dominates the market with a share of 38%, followed by Ripple, Ethereum, Litecoin, Bitcoin Cash. Exchanges like UnoDAX, Bitfinex, Kraken, Bitstamp have listed many other coins like Golem, Civic, Raiden Network, Kyber Network, Basic Attention, 0X, Augur, Monero, Tron and many more. If any of the coins suit your portfolio, you should buy it.

But you should invest money in the market that you can afford to lose because the cryptocurrency market is very volatile and no government can control it.

When to buy?

There is no hard and fast rule when to buy your favorite cryptocurrency. But it is necessary to investigate the stability of the market. You shouldn’t, but at the peak of the cryptocurrency bubble or when the value is continuously collapsing. The best time is always when the price is stable at a relatively low level for some time.

A method of storing cryptocurrencies

Before buying any cryptocurrency, you need to understand how to keep your cryptocurrency safe.

Generally, all exchanges provide a vault where you can store your coins safely. Do not share your username, password, 2FA details when you store cryptocurrency on exchanges.

Paper wallet, hardware wallet, software wallet are some of the channels where you can store your cryptocurrency.

Paper Wallet: A paper wallet is an offline way to cold store your cryptocurrency. It prints your private and public key on a piece of paper that also has a QR code printed on it. You just need to scan the QR code for your future transactions. Why is it safe? No need to worry about your account being hacked or a malware attack. You just need to keep your piece of paper in a locker and if possible keep two or three pieces of paper in your wallet under your complete control.

Hardware Wallet: A hardware wallet is a physical device where you keep your cryptocurrency safe. There are many forms of hardware wallet, but the most commonly used is the USB hardware wallet. If you store your cryptocurrency in a hardware wallet, you just have to keep in mind that you should not lose your hardware wallet, because once you lose it, you will not be able to get your cryptocurrency.

One famous case where a person mined over 7,000 bitcoins and stored them in his hardware wallet and stored them in another hardware wallet. One day he threw away the hardware wallet he was storing his cryptocurrency in instead of damaged hardware and lost all his bitcoin.

What can you buy in cryptocurrencies in India?

Most people assume that buying and selling any cryptocurrency is only for investing and getting high returns in the long and short term. Bitcoin influencers and investors believe that Bitcoin will dominate all fiat currencies and be accepted as an international currency in the coming years.

Dell is one of the largest e-commerce companies that accepts Bitcoin as payment. Other examples are Expedia and UNICEF.

In India, Sapna Book Mall accepted Bitcoin as payment through the Unocoin merchant service. People used to book movie tickets through BookMyShow or top up their mobile using the Unocoin platform. According to the report, they have stopped the service but plan to launch it again soon.

Conclusion:

Cryptocurrency is one of the growing investment sectors and in the past it has given better returns than real estate, gold, stock markets etc. You can buy a cryptocurrency and hold it for the long term for a nice profit or go short term for a quick profit as we have seen many coins grow by 1000%+ in the past. Since cryptocurrency is a volatile market and the government does not control the industry. One should invest an amount in any cryptocurrency that they can afford to lose.

You can store your cryptocurrency in a hardware wallet, a paper wallet, a software wallet if you don’t want to store it on the exchange you trade with.

For cryptocurrency investors, the more important question is whether this round of currency price increases is a bull market restart or a bear market trap.

Last night, the price of bitcoin went up in just one hour. The price rose violently from around US$6,800 to a high of US$8,100. It grew by almost 20% in a day. Led by Bitcoin, other virtual currencies also began a strong rebound, with the single currency even surging above 50%. Faced with the collective warming of the virtual currency market, many investors shouted that the “bull market is back.”

According to data from the CoinMarketCap website, Bitcoin’s market value increased by almost US$20 billion overnight, and the entire virtual currency market also experienced overall market growth. There was no “search” effect. With daily bitcoin transaction volume exceeding US$9 billion, billions of additional funds, not equity funds, should have flowed into the market yesterday.

In fact, during Bitcoin’s heyday, Bitfinex, a digital currency trading platform, also recorded a number of large purchases. With the increase in Bitcoin buying, many shorts were forced to close out their positions, further extending the market’s uptrend. Nick Kirk, chief data officer at Cypher Capital, also expressed his approval of the phenomenon. At the same time, he also believes that this sharp rebound is most likely a response to the removal of early regulatory pressure.

Pantera Capital Management, one of the world’s largest digital currency hedge funds, has said that Bitcoin has bottomed out. USD 6,500 is the lowest point for the Bitcoin bear market. Bitcoin will stay above this price for most of this year and may even surpass the record high of US$20,000 last year.

Fundstrat founder Tom Lee also expressed confidence in Bitcoin. He believes that the current P/B ratio and other indicators of Bitcoin are almost the same as in late 2014 and have formed an important technical correction. Based on this, he said that the value of Bitcoin could more than triple this year and rise to US$25,000 by the end of this year.

Historical data shows that Bitcoin did rise in the second quarter of the calendar year. In the second quarter of 2011, Bitcoin rose by 1964%, in 2012 – by 36.25%, in 2012 – by 61.98%, in 2017 – by 131%.

Of course, OTC Bitcoin volume is also showing signs of market recovery. Since March, Bitcoin trading volumes in Canada, Europe, Vietnam, Mexico and Vietnam have increased to record highs.

With the successive arrival of large financial institutions, such as the hedge fund giant Soros and the leading financial group of the Rockefeller family, the financial dimensions of the virtual money market will further expand.

However, it should be noted that while Bitcoin is currently on a strong uptrend, it is still in a downtrend channel and has yet to be effectively broken out. It remains to be seen whether the virtual currency market has really turned around. Investors should always be vigilant and pay attention to position management.

More importantly, the world’s major bitcoin markets, including the United States, have sought to create a regulatory framework. Regulatory uncertainty will inevitably have a greater impact on the short-term development of the virtual currency market. In the long run, an orderly, healthy market can go even further.

In case you don’t know, Bitcoin is a type of decentralized network cryptocurrency. In this process, transactions are based on a 16-digit encrypted address. Simply put, it’s like your social security number. In terms of security, only you can transfer funds because you have an address that supports two-factor authentication. In fact, Bitcoin consists of a network of several independent computers that are responsible for generating, distributing and verifying monetary transactions. Let’s find out more.

How do you buy Bitcoin?

If you want to buy bitcoins, make sure you have a wallet app installed on your computer. With this app you can send and receive as many bitcoins as you want.

To purchase bitcoins, you must deposit funds into your web wallet, which acts as a bridge between sellers and buyers.

Once the exchange has accepted your currency, your next step is to place an order, which is similar to buying a stock.

How does bitcoin work?

Bitcoin is essentially an international decentralized peer-to-peer network. Below is a description of how Bitcoin works.

1. First of all, bitcoins are created by using computers to solve mathematical functions. And then there is the transaction verification process.

2. In the next step, traditional currencies are used to exchange Bitcoin. In fact, it works as a gateway to the world of cryptocurrency, especially for non-miners. You can say it is similar to buying stocks using a trading app.

3. Whether you are an individual or a business, you can create wallets to send or receive bitcoins. If you used a PayPal account, you can easily use this type of wallet as well. The good thing about cryptocurrency is that it is based on a secure network. In addition, it makes all transactions completely secure.

Can you mine bitcoins at home?

If you are interested in mining bitcoins at home, the description below can help you get started.

Cryptocurrency mining

Cryptocurrency mining is an approach that involves confirming cryptocurrency transactions and making entries in the blockchain ledger. If you want to authorize or mine cryptocurrency transactions, you need to compete with many other minors by performing complex calculations. This type of processing requires a lot of processing power.

Once the transaction is done, the system will reward you with bitcoins or whatever currency you mine.

Can you use your laptop to mine bitcoins?

The good news is that you can use your laptop to mine bitcoins. However, the million dollar question is, can it make you enough money? Short answer: no. ​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​​Even though you can mine with a laptop, you won’t earn more than pennies, which isn’t worth it.

In other words, you need an extremely powerful computer with multiple graphics cards to enjoy the highest mining speed.

So, if you are interested in mining or investing in bitcoins, you can follow the tips given in this article.

“Mom, where do bitcoins come from?” Well, you see when a young, shiny Bitcoin catches the eye of an ambitious miner, and because they love each other so much…

Wait, that’s obviously too difficult to solve. Also, my main goal is to keep things simple. In any case, bitcoins are obtained by solving complex mathematical problems. This is done with the help of a powerful machine designed to solve these mathematical problems. This process is called mining. The people who own these machines to earn money from mining bitcoins are called miners. When a set of problems is solved, it becomes known as a block. Blocks are verified by other users, and after they are verified, they are added to a so-called block chain. This chain continues to grow with a new block added to it approximately every 10 minutes. This chain is really just a ledger that will grow and never end.

Very powerful mining machines consume a lot of energy and add to a miner’s monthly utility bill. The reason so much energy is required is because of the genius of the mathematics involved. This requires the mining machine to perform complex cryptographic algorithms. After the machine solves the math problem, a block of coins is born. Every time 210,000 blocks have been generated, the miner’s reward is halved. It takes 4 years. So it’s kind of like the Bitcoin Olympics. Currently, the block reward is 12 bitcoins (on June 23, 2020, the reward will be only 6 coins). These coins go to the miner whose car at that moment became the lucky winner of the lottery. There is a winner every 10 minutes. There are also a lot of miners competing. Now said miner has something of value. Mine enough coins and you pay your electricity bills and then some.

There is another way of mining. This is called cloud mining. With this type of mining, you pay to use someone else’s network, and this significantly reduces your profit. The advantage of this method is that it does not require the use of electricity or even the purchase of a machine.

Sounds good to me. I want to start mining now. Is this a good idea and can I earn passive income on a regular basis? It is possible. Wait for now and you can make that call later.

Let’s try to figure it out.

Going back to the original way of machine mining, you would need to start by buying a quality mining machine. It will set you back around $2,000. Here is a photo of a good machine (Antminer S9 by Bitmain) capable of producing a high hash rate of 14 TH/s. 1 TH/s is 1,000,000,000,000 hashes per second. This car does that 14 times. That’s a lot of hashing power. A hash is simply a long number that the machine creates each time it tries to solve the algorithm. Again, to use my lottery analogy, all these machines are hashing in hopes of becoming the next winner.

Then your chances of winning become more and more difficult with more competition. Further complicating this issue is that each time a math problem is solved, the next problem becomes more difficult to solve. The complexity of the Bitcoin network changes approximately every two weeks or 2016 blocks. The number of Bitcoins that will ever be created is limited. That number is 21,000,000. Once we reach that number, bitcoins will never be mined again. However, the blockchain itself will continue to expand because it is used to verify each transaction or purchase.

Remember that Satoshi Nakamoto alias I wrote about too? Did you know that today’s math problems are more than 70,000 times harder for machines to solve than us, he mined the first bitcoin in 2009?! The final coin is estimated to be mined in 2140 because the system is halved (210,000 blocks) every four years. 16,400,000 coins (78%) have already been mined and each coin will be mined at a much slower rate from now on. Yes, you read that right. Basically 80% was mined in the first 8 years and it will take more than 100 years to mine the last 20%. If any of my great-great-grandchildren are reading this, I hope you are sitting well with our family’s bitcoins now valued at 220,000 per bitcoin. We can all dream!

Buying a mining machine or purchasing a cloud mining contract is risky. ​​​​​​While there are some great success stories out there, be sure to research them carefully before deciding whether mining is right for you. For every person who makes money, there are many people who lose money.

By the way, this is a great place to see all the cryptocurrencies out there, their total coins and market cap, Coin Market Cap is a great resource. You can see all the 700+ altcoins that fly by overnight. Altcoin is another way of calling any cryptocurrency coin that is not Bitcoin. By now you probably know that Bitcoin is like the Rose Bowl, the granddaddy of them all! For now, I would try to limit my focus and research to the top 10. Not that there aren’t success stories of one of the near-negligible right now. Just finding one is like picking the right penny stocks. It is much safer to stick with well-known companies that are recognized by mainstream analysts. The same goes for the exchange you use to buy, sell and trade. That’s why I use Coinbase to make transactions because it’s the most reliable, secure and convenient exchange. They also have the most thorough vetting process when it comes to adding altcoins.

Here is a summary of the key points from this article:

-Bitcoins are created from mining

– Mining is carried out by powerful machines that solve complex mathematical problems. You can also buy contracts called cloud mining if you don’t want to buy a machine.

– Challenges get more complicated as coins are mined and the rate of mining slows down

-As of May 2017, only 72 bitcoins are mined per hour (12 every 10 minutes)

-On 23 June 2020 this will be halved again to only 6 every 10 minutes

-Almost 80% of the final Bitcoin supply of 21,000,000 coins has already been mined

-Competition among miners and increasingly complex math problems make it harder to profit

– The last coin is estimated to be minted in 2140