Bitcoin (BTC)

Bitcoin is the first ever created cryptocurrency that is based on the blockchain. It enables payments to be sent between users without passing through a central authority such as:

• Bank
• Payment Gateway
• Middlemen

What is a bitcoin?

Bitcoin is created and held electronically unlike dollars or euros. Bitcoin is produced by computers all around the world through usage of free software. There is a set amount beyond which more bitcoins cannot be minted, meaning it's deflationary.

Bitcoin is founded on the idea of decentralization. No single person or entity owns its network or any of the information within. The amount of Bitcoins that can be created is set and no more than 21 million can ever be in circulation.

Distributed append-only ledger

Bitcoin is built on its very own blockchain. Another way to call it  would be a “distributed append-only ledger”. You can think of it as a spreadsheet that is simultaneously on thousands of computers across the world. When a transaction is verified by a miner, the transaction (The Block) gets added into the spreadsheet (A chain of blocks) which is updated across thousands of computers around the world.

Security

You might find yourself asking how is this secure? The short answer to this is miners. The long answer is a bit more technical.

SHA256 is a hashing function that takes an input of a random size and produces an output of a fixed size. This process is a one way meaning that the it is possible for anyone to guess the output when given the input but impossible for anyone to get the input when given the output. Making it ideal for Bitcoin when creating wallets and validating blocks.

When a Bitcoin is sent to another account, The validation process starts. Miners will have to validate the transaction or block to ensure the block isn’t fraudulent and by doing so the miner is given a very difficult hashing problem to solve. This is called Proof of Work, and it uses the SHA256 hash function to ensure a secure blockchain.

Public and Private Keys

These keys are another part of the Bitcoin network that are produced using the SHA256 hashing function.

When creating a wallet to store Bitcoin a user will be given a private key.Whoever knows the private key owns the wallet. Always keep private keys safe, This is the username and password for your bank account in one key. Public keys are effectively the bank account number that you give people for so they can send you money.

The Bitcoin Cap

As mentioned before there are 21 million Bitcoins that can be created, However only about 16 Million of these Bitcoins are in circulation. The other 5 million are still being minted by miners. There's also a huge amount of the circulating supply that is considered lost forever for various reasons(lost/destroyed hardware wallets, lost private keys etc.) . Estimates state about 4 million BTC are never going to be seen again.

• A Bitcoin can be broken down into a fraction of a peice. Currently the smallest fraction of a Bitcoin is 0.00000001 which is about $0.0001 USD
• The original developer Satoshi Nakamoto to this day remains anonymous with an address holding approximately 1 million Bitcoin.
• The first Bitcoin transaction consisted of 10 BTC from Satoshi Nakamoto to Hal Finnley
• Laszlo Hanyecz famously bought two pizzas for 10,000 BTC on the 22nd March 2010.

Team 

https://bitcoincore.org/en/team/

The Bitcoin Core project has a large open source developer community with many casual contributors to the codebase. There are many more who contribute research, peer review, testing, documentation and translation.

Bitcoin is the first instance of a popularised digital asset. An anonymous software developer, going by the pseoudonym of Satoshi Nakamoto proposed Bitcoin in 2008, as an electronic payment system based on mathematical proof. The idea was to produce an alternative to the avaliable until then means of exchange, independent of any central authority, that could be transferred electronically to any point of the world in a secure, verifiable and immutable environment.

From then Bitcoin has risen and fallen over the years, going through quite the rollercoaster. An infamous setback in Bitcoins history is the fall of Mt.Gox exchange. Mt Gox at the time of its security breach was handling roughly 70% of Bitcoin transactions. The breach resulted in 850000 BTC missing and caused many people to lose faith in Bitcoin's concept.. Prices went from $1200 down to $300 and stayed that way for a long period of time. Since then, the price has skyrocketed to the whopping $18000 and saw quite a brutal correction downwards, stabilizing in the $5000-$9000 range.

Project maintainers have commit access and are responsible for merging patches from contributors. They perform a janitorial role merging patches that the team agrees should be merged. They also act as a final check to ensure that patches are safe and in line with the project goals. The maintainers’ role is by agreement of project contributors.

Who do you think REALLY created Bitcoin? Dan Pena has given his thoughts here:

Coinnounce Article

It’s no secret that the past year has been an arduous one for Bitcoin and the entire crypto markets, and despite posting a slight recovery from its 2018 lows, BTC’s current price action is still dismal to say the least, and any talk of an imminent price surge remains nothing more than speculation.

Despite this, Bitcoin’s hash rate has been on that up-and-up as of late and has recovered significantly from its recent lows. This recovery signals that miners are gaining greater confidence in the cryptocurrency, which may signal that a price surge is, in fact, imminent.

Bitcoin (BTC) Price Stable as Hash Rate Climbs

At the time of writing, Bitcoin is trading flat at its current price of $4,020, directly in the middle of its recently established trading range between $4,000 and $4,100 which has persisted for the past couple of weeks.

Although the cryptocurrency’s price has been flat lately and volatility is on the decline, its hash rate has been gradually climbing, which may be a bullish sign.

BTC’s hash rate hit highs of just over 60 million tera hashes per second (TH/s) in late-August of 2018 before plummeting to lows of 30 million TH/s in late-December of last year, which coincided closely to Bitcoin’s plummet from $6,400 to lows of $3,200 in mid-November.

Since then, the cryptocurrency’s hash rate has been climbing, and is currently sitting at just under 50 million TH/s.

Dovey Wan, a popular figure within the cryptocurrency industry and the founding partner at Primitive, recently pointed to the recovering hash rate as a sign of increasing confidence from Bitcoin miners.

Cold Storage

Also referred to as "cold storage", hardware wallets are dedicated wallet devices, often in the form of a USB stick. Just plug it in to an internet-enabled device to transfer assets. Even though transactions are made online, the keys are stored offline. Thus, hardware wallets are one of the most secure methods of storing cryptocurrencies, in addition to being portable. Some hardware wallets come equipped with an OLED screen for displaying and verifying important details, while other features can also include the ability to be restored using seed phrases in case of damage, loss or malfunction of the device. All these factors combined make hardware wallets one of the safest(if not the safest) ways to store crypto.

The two most popular choices for hardware wallets are either Nano Ledger S or Trezor. However as you might guess those wallets come at a price. The price range for a Trezor starts at about $100 and the high end models can go up to $200. The Ledger Nano S is slightly cheaper, going for around $70.

The security these devices provide is priceless and if you hold large amounts of BTC it's definitely worth investing on one.

Ledger

As for using the Nano Ledger S, the first step towards setting up your device is unboxing you device and checking if you have received all the accessories with the device. Once you have unboxed your device, you need to configure it and initialize it before being able to use it. The process is quite simple and will hardly take about 20-30 minutes post which you will be set to use your Ledger Nano S device. 

Once you have done that, you should plug-in your device in your desktop or laptop using the USB cable. Now you need to follow the instructions displayed on the screen with the help of the instruction sheet received in the box. Remember, this is the most important step, and you will be initializing your device with a seed. This seed is everything. You need to guard it with your life because using this seed anyone can steal your coins. This is also known as recovery phrase. Always store your recovery phrase on an offline sheet. The final step before you can use your cold storage is setting up the apps associated with it. The video below explains in detail how it's done:here

Trezor

As for Trezor, installing is really simple. To properly install it users should attach the unit to the computer. After that continue with installing the  bridge which allows the Trezor to join with the computer. The first step is to connect the Trezor to device’s USB slot with the cable given in the box.  After that, go to myTrezor.com and proceed with installing the browser extension. Trezor can also be used on Android or an iPhone, or on a Windows or Mac computer. Now, initiate the extension and myTrezor will direct you to pick a PIN. After this, you will notice nine buttons but the numbers are hidden. After this, users should check the Trezor’s screen to recognize which numbers are in which place because it switches every time. Now set the PIN. Shortly after, Trezor should present a 24-word wallet “seed”. In short, one word at a time. Note down this seed and save it carefully. If your Trezor device malfunctions or is lost, you can utilize the seed to reconstruct the complete wallet.

A desktop wallet offers a number of advantages over an online wallet. While online wallets are easily accessed from anywhere in the world, they are also more vulnerable to potential hacking. Desktop wallets, on the other hand, are accessed only via your private computer, with personal security keys stored just on that machine. Thus, exposure of your security online is reduced. Nonetheless, desktop wallets are still susceptible to hacks if your machine gets infected with malware designed to root out keys and steal Bitcoins.There's also the risk of a hardware malfunction which again will result in your wallet being inaccesible. At minimum you should print or even better write they keys and 12 words down on a piece of paper and store that in a fireproof safe. 

Exodus

A good example of a desktop wallet is Exodus, which supports numerous other cryptocurrencies along with BTC and is pretty straightforward and easy to use. Just download the app from the official site(exodus.io) and get straight into creating your wallet. 

Jaxx

Another great wallet you could use is Jaxx, which is also secure and offers additional layers of privacy.

First off, we will start with online wallets. There are multiple online wallets you can use, some safer than others but not as safe as a desktop or hardware wallet. However online wallets come with the practicality of being avaliable from anywhere in the world, on any device. Bitcoin.org recommends one of the following online wallets:

-BitGo

-BTC.org

-Coin.Space

These wallets are pretty straightforward to use. You start by generating a private key. The private key should be safeguarded as well as you could as losing it will cause you to forever lose the BTC you have stored inside the wallet. Turning on two-factor authentication is highly recommended, as it will add an extra layer of security to your wallet in case your private key is compromised. Once you've logged into your wallet with your private key, you will have the ability to transfer funds to it by using your public key.

There are numerous ways to store your bitcoins depending on your risk tolerance and the amount you're storing. Storing your btc in an exchange is not recommended, as you have no hold of your private key. Also, many exchanges suffer from security breaches or you may become a victim of one of the many phishing scams that come in various forms like emails or an exact replica of the exchange's front end.

Buying bitcoin can be done multiple ways. The most popular way is buying via credit/debit card on one of the many popular exchanges. Coinbase or Coinmama are both great choices. 

Coinbase

Coinbase, currently the largest bitcoin broker in the world, allows you buy up to $150 or €150 of bitcoin per week instantly with a debit card. Charges are a flat 3.99% fee on all purchases via debit card, which is among the lowest for European and US customers. Its very beginner-friendly, instant and aged accounts have high daily limits. 

Coinmama

Coinmama is a bitcoin broker that specializes in letting you purchase bitcoin with a debit or credit card. You'll be charged a 6% fee due to the risks and processing fees that come with credit card payments. Coinmama offers high limits. You can buy up to $5,000 worth of bitcoin per day or $20,000 worth of bitcoins per month. Its important to note that nearly all exchanges require KYC verification especially for credit card purchases. This is done to prevent fraudelent activity so purchasing bitcoin anonymously is almost impossible nowadays.

There are certainly other exchanges and brokers you could use. Binance, which is one of the top exchanges by volume recently added a credit/debit card option for purchasing many top cryptocurrencies including BTC. It had a security breach, however, so approach using it with caution.

Another way to buy btc is using localbitcoins.com. The service allows peer-to-peer exchange via a bank transfer or even in person. However, extreme caution is advised when meeting a stranger especially when it comes to buying large amounts of BTC.