1. Who created Bitcoin?
Bitcoin was created by Satoshi Nakamoto. The name Satoshi Nakamoto is a pseudonym for a person or group of people. The person who created Bitcoin has nothing to do with its functioning as a payment system or with the technology behind it. In reality, it doesn’t matter who Satoshi Nakamoto is.
2. How did this all get started?
One very important document we have from Satoshi is his whitepaper which describes bitcoin in technical detail. Bit Basics was created to serve as a simpler, non-technical explanation of Bitcoin based directly on Satoshi’s whitepaper. Click here to read it. Additionally, the Bitcoin source code can be viewed here.
1. How does Bitcoin work?
Bitcoin runs on a peer-to-peer network with no centralized Bitcoin server. No company, government, or individual has control over Bitcoin. It was designed to be used, run, and maintained by millions of people all over the world, like you.
Everytime bitcoin is used for goods or services, that transaction must be approved by the entire network. This eliminates fraudulent transactions, chargebacks, and other common payment problems.
2. How do I install a Bitcoin Wallet?
3. How do I send/receive bitcoin?
All it takes is an app installed on your Android/iOS device or computer. Once you have a wallet using Bitcoin is as easy as clicking send on an email. When receiving bitcoin through a digital wallet your public address comes in the form a QR Code like this.
Just present the QR Code to be scanned by the sender and thats all you have to do! Your Bitcoin will appear nearly instantly once its sent, no waiting required.
4. Who runs Bitcoin?
In short, no one runs Bitcoin. Bitcoin is run collectively by its users, and any changes to the Bitcoin system have to be approved by the majority of users before they are added.
5. Is Bitcoin backed by a government or company?
Bitcoin is a decentralized public network that is run and maintained by its users. It is a network built for its users and by its users. Thus bitcoin cannot be “backed” or controlled by a government. In technical terms, Bitcoin is backed by a mathematically secure protocol.
6. What is Bitcoin technically?
Bitcoin, like HTTP (web browsers), and SMTP (email), is a protocol.
Individual Websites can be hacked, HTTP cannot.
Individual email addresses can be hacked, SMTP cannot.
Individual Bitcoin wallets can be hacked, Bitcoin cannot.
7. How long do transactions take?
Most merchants accept the transaction after a couple of confirmations (less than 30 seconds) from the network; rather than wait for every confirmation to occur, which takes less than 10 minutes. As of late, transactions can take a little longer due to Bitcoin’s growth in use and popularity.
Adding priority confirmation through fees by the sender can cut confirmation times significantly, however they are not necessary to complete a transaction, in any way.
When you receive bitcoin it is then yours, there are no chargebacks because it is a push only network. No one can take money from your account without your permission.
8. Can my bitcoins be stolen?
Bitcoin is only as secure as the device it is on. If your computer is free of malware and viruses and you do not give out your password; your bitcoins cannot be stolen.
9. What purpose does mining actually serve?
The answer is twofold: it secures the network by verifying transactions and allows the initial supply of Bitcoins to be distributed without a centralized authority.
10. Is Bitcoin fully virtual and immaterial?
Bitcoin is as virtual as the credit cards and online banking networks people use everyday. Bitcoin can be used to pay online and in physical stores just like any other form of money. Bitcoin balances are stored in a large distributed network, and they cannot be fraudulently altered by anybody. In other words, Bitcoin users have exclusive control over their funds and bitcoins cannot vanish just because they are virtual. To put it into perspective, it is currently estimated that only 8 percent of the world’s currency exists as physical cash.
1. Why is it valuable?
Bitcoin is a combination of a precious commodity (like gold), a spendable currency (like dollars, euro, or yen), and a technology (like email). It’s scarce, useful, and impossible to counterfeit.
2. How can I get Bitcoin?
There are 4 main ways to acquire bitcoins:
- Receive bitcoin as payment by selling goods and/or services. BEST WAY.
- Buy some locally from a friend or a website such as localbitcoins.com.
- Buy it from a currency exchange such as circle.com(US,CA,EU), coinbase.com(US,EU), vaultofsatoshi.com(CA), bitstamp.net(EU). These services can be used to both buy and sell bitcoin.
- Acquire it by running the Bitcoin program on your computer.
3. Do I have to buy a whole bitcoin?
No, one bitcoin is divisible down to eight decimal places. You can buy as little as 0.00000001 bitcoin. As the value of the unit of 1 BTC grew too large to be useful for day to day transactions, people started dealing in smaller units, such as milli-bitcoins (mBTC) or micro-bitcoins (μBTC).
4. What does a bitcoin cost? How is its value determined?
There are many websites that tell you the current price of bitcoin; you can click here to get a current price. As with most things in an economy, its value is determined by supply and demand . The value of bitcoin is determined by worldwide consumer demand and its ever increasing utility as a currency. There are a finite number of bitcoins, so anything with utility AND scarcity has a market price. Bitcoin is a combination of a precious commodity (like gold), a spendable currency (like dollars, euro, or yen), and a technology (like email). It’s scarce, useful, and impossible to counterfeit.
5. Where can I spend my bitcoin?
Bitcoin is directly accepted by over 100,000 retailers worldwide and is indirectly accepted by millions of retailers worldwide through 3rd parties such as Shopify and Square. You can get a bitcoin debit card such as the Shift card. With a bitcoin debit card you can spend bitcoin anywhere debit/credit cards are accepted. Currently there are over 200,000 retailers worldwide. Here is a short list of retailers who are currently accepting bitcoin:
- General Goods & Gifts: Overstock, 1-800-Flowers, Reeds Jewelers, Gyft (includes many more popular retailers such as: Amazon, Whole Foods, Target, Home Depot, CVS, Best Buy, Starbucks, Caribou Coffee, Victoria’s Secret, Sephora, Express, Kohls, NFLShop.com, Nike, American Airlines, Hyatt Hotels, and many more!)
- Electronics & Entertainment: Overstock, Dell, Newegg, Microsoft, TigerDirect, Dish Network
- Travel & Internet: CheapAir, Expedia, Virgin Galactic, WordPress.com, Namecheap.com, Shopify (over 100,000 retailers), Square (millions of retailers)
- Local: Check out coinmap.org to see if any local businesses accept bitcoin in your area!
6. Which wallet should I use?
Our recommendations have recently changed. Check back soon.
1. Why do people trust Bitcoin?
Much of the trust in Bitcoin comes from the fact that it requires no trust at all. Bitcoin is fully open-source and decentralized. This means that anyone has access to the entire source code at any time. All transactions and bitcoins issued into existence can be transparently reviewed in real-time by anyone. All payments can be made without reliance on a third party and the whole system is protected by peer-reviewed cryptographic algorithms like those used for online banking. No organization or individual can control Bitcoin, and the network remains secure even if not all of its users can be trusted.