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Essential pointsBitcoin is an electronic currency known as a cryptocurrencyThe peer-to-peer technology underpinning it is known as the blockchain a public ledger of all transactionsBitcoins can be stored in a virtual wallet and used to buy other currencies or actual world goods

Where once a single bitcoin was worth a few cents it's now worth about $9,200 per coin (November 2017), creating millionaires in the process.There have been many reported instances where individuals mined thousands of comparatively worthless bitcoins as a hobby years ago, only to now realise they are rich.One IT worker even threw out a hard drive containing 7,500 bitcoins.

This is done with no central authority or bank.Who generated itBitcoin and also the blockchain technology was made by someone under the pseudonym of Satoshi Nakamoto and released as a working beta in 2009. Satoshi's true identity remains a mystery as he disappeared from the scene in 2010 after seemingly handing over the reins to Gavin Andresen, the chief scientist in the Bitcoin Foundation.Over the years numerous people have claimed to be Satoshi, including Australian computer scientist Craig Wright.

Once the limit is reached, no more bitcoins can be made.However, a single bitcoin can be subdivided as far down as the eighth decimal place (0.00000001BTC) to buy smaller goods using only a fraction of the coin.How do you shop or send bitcoinYou can shop and send bitcoins via an encrypted digital wallet, which is run as an app on your computer.The wallet works with two keys a private key and a public key which look like a seemingly random string of numbers and letters.The private key is kept confidential by you and acts as a password that unlocks the wallet and lets you send any bitcoins associated with that.

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If the web site gets hacked or someone gets your login information they could access and drain your funds from the exchange.There is no way to get a transaction to be revoked or revoked if a thief sends your bitcoins to their wallet.After buying your coins you need to transfer them into a secure digital wallet created by you and not hosted online.You can even write down the pocket's personal key on a sheet of paper (this is known as a newspaper wallet) and stick it in a safe.If you don't save the personal key on your computer or online then hackers can never break in and access your funds.

Bitcoin means different things to different individuals. For many, it's a future of freely moving currency untied to any central bank. To others, it is a purely electronic entity of questionable worth and doubtful origin. However, what is Bitcoin, in the most basic senseIn most casual view it now conversations, you can get away with knowing that bitcoin is, essentially, an electronic currency.

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In fact, it is two considerably more complex things.Bitcoin has been with us since 2009, when a person (or group) under the pseudonym Satoshi Nakamoto introduced a stage (Bitcoin, uppercase) that hosts a digital currency (bitcoin, lowercase). Bitcoin the platform is built on the concept of proof of work data which is expensive and time-intensive to produce but can be readily verified.

To mine a bitcoin, a computer has to complete a complicated algorithm, essentially going through the work of an extensive calculation in exchange for a few newly minted currency. That bit of electronic currency is worth whatever the market decides through distribution and demand.Transactions are connected to some users Bitcoin address, which can be saved on its general ledger, known as the blockchain.

This comparative anonymity makes the platform appealing for things like incognito purchases within the internet.A key component of Bitcoins blockchain is the fact that it is an open, distributed ledger. Throughout the distributed nature of this ledger, the transactions on the blockchain are confirmed by the consensus of each member, offering protection and trust without a third-party overseer.One of the most important things to bear in mind when thinking about exactly what Bitcoin (or bitcoin) is: there is no single answer.