Crypto currencies are digital assets or alternative currencies that are stored in computer basis and have no physical form. Anybody can buy and sell crypto currencies.
Crypto currencies are decentralized hence no one issues or controls them, they run on simple and logical computer codes and the value of the currency is determined by the market.
Bitcoin is a popular digital currency, created and stored electronically. It’s not centrally controlled, nor are bitcoins printed; instead, bitcoins are made by people and businesses through software that solves mathematical problems.
Bitcoins belong to a growing category of digital money called cryptocurrency.
One of Bitcoin’s most distinguishing characteristics is that it’s completely decentralized. This means that its network is not controlled by any one institution. This makes a lot of people feel secure because it means that a large bank or institution won’t be able to control their money.
There’s many advantages to using Bitcoin, many of which include:
Quick, Easy and Convenient - You can send and receive bitcoins anywhere in the world at any time in a matter of a few minutes.
Low Fees – Normally, the fees for Bitcoin transactions are very small. Bitcoin fees can fluctuate due to the dynamic fee market. In addition, some wallets will also allow you to pay a fee you’re willing to spend. With higher fees, you’ll get faster confirmation of your transactions.
Secure – When using Bitcoin, users remain in control of their transactions. You’re also protected from identity theft since Bitcoin payments can be made without personal information associated with the transaction.
Transparent - All Bitcoin transactions are fully available on the block chain for anybody to verify and use in real-time.
Bitcoin transactions occur between electronic Bitcoin wallets, and are digitally verified and signed for security. Thanks to the massive public ledger called the blockchain, users are aware of all transactions, and its history and when bitcoins were generated can be tracked.
If you send some bitcoins to, say, a friend, that transaction will have three pieces of information:
The amount of Bitcoin you wish to send.
The recipient’s wallet address, generated randomly and consisting of a sequence of letters and numbers – this is where you’ll be sending your funds.
A private key, which is also a unique sequence of numbers and letters exclusively available to you. This key will allow you to access your wallet.
Once a transaction is set up, it makes its way into the Bitcoin network where it awaits verification. Through the process of mining, miners use software to solve mathematical problems. Once completed, the transaction successfully moves into the block chain.
Bitcoin has a strong track record for security and privacy, thanks to its protocol and cryptography. With private keys, individuals’ wallets are kept secure. The only way this would not be true is if users lose this information.
This is why, you should always take care with securing your funds, and we’ve assembled some tips and tricks to help you along the way.