Bitcoin, how does it work?
Bitcoin, how does it work?
The SII Group and the School of Advanced Digital Technologies (ETNA) have developed a broadcast broadcast on the Internet called Blockchain Revolution. It explains in detail the phenomenon of the blockchain and bitcoin, this cryptographic currency which is much talked about.
There are many cryptocurrencies, bitcoin is the one with the highest valuation. It is a currency that also designates a blockchain protocol that offers the possibility of making secure and transparent transactions.
Creation of bitcoin and use
This currency was invented in 2008 and its open source software released in 2009. Its creator, who hides behind the pseudonym of Satoshi Nakamoto, has still not been identified.
Bitcoin can be used to buy goods and services, it can also be exchanged for other currencies. Many websites but also physical stores accept this currency, one of the main advantages of which is the low cost of transaction fees.
Unlike traditional currencies, bitcoin is not administered by a single banking authority, it operates in a decentralized manner through a set of nodes. These form the network through which all transactions are made. A secure public ledger called blockchain or “chain of blocks” keeps the history of all these operations. You can check out this article on the definition of bitcoin to learn more.
The price of bitcoin is very fluctuating
Voluntary users provide their time and the computing power of their computers to administer the blockchain. This operation called “mining” allows these people to be paid, in bitcoin of course. The value of bitcoin is maintained by mining software which adapts the intensity of the calculations to the number of active miners. The more bitcoin miners there are, the more complex the calculations.
To use bitcoins, you must first create a virtual wallet that you will supply by going to an exchange to convert cash or by selling goods or services online. Several platforms offer the conversion of dollars, euros or yuan into bitcoins. The exchange rate of this currency has experienced large variations which are monitored daily by indices such as the one offered by CoinDesk. In 2011, for example, bitcoin was available for 4.15 euros. Two years later, in December 2013, it was necessary to pay 860 euros. In December 2017, the value reached the dizzying figure of 16,000 euros.
One of bitcoin’s strengths, which is at the same time a weakness, is the lack of a legal framework. With regard to an international currency, the existing legislation creates great disparities in approach. Some countries like Russia have chosen to make the use of bitcoin illegal, while France and the United States have not yet decided to regulate the use of this currency.
It is difficult to explain the reasons why the price unexpectedly falls or rises. Since the creation of bitcoin, the price of this cryptocurrency has varied a lot, in November 2021 its level reached 68,000 dollars, which is very significant. The price of bitcoin is generally expressed in euros or dollars.
To buy bitcoins, it is necessary to open an account on a crypto-currency exchange platform (you can find many of them all over the world, more or less simple to use). Generally, to obtain bitcoins, you can make a bank transfer or use a credit card. Before deciding, it is important to know that this is a risky investment. Low periods, when the price of bitcoin falls are unpredictable, investing in crypto-currencies is never without risk.
It is important to take into account that the price of bitcoin varies from one platform to another up to several thousand dollars. Before buying, it is essential to exercise caution. Several reasons explain these variations which can seem surprising in particular, the average of the transactions is not always calculated in the same way. A study by the management company Bitwise Asset Management has shown that a volume of crypto exchanges would be false, which explains the price difference on the platforms.
How to convert bitcoins to euros?
When you buy crypto-currencies, especially bitcoins, it is possible to transfer them and convert them into real money in a bank account. A good solution exists, using a Bitcoin credit card to spend your bitcoins, a simple way to convert cryptocurrencies and bitcoins into dollars or euros. There are more and more credit cards of this type that can come in handy as a crypto payment.
To send bitcoins to a bank account, it is possible to sell cryptocurrencies on a crypto exchange platform.
Bitcoin ATMs (Bitcoin ATM) are installed in large numbers around the world. They allow you to exchange bitcoins for money while remaining anonymous.
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