- 1 History of Bitcoin
- 2 What is Bitcoin Simply Explained ?
- 3 What is Bitcoin mining?
- 4 Why Bitcoins value growth?
- 5 Why Bitcoin is not good?
- 6 How to buy Bitcoin?
- 7 Bitcoin Security
- 8 Conclusion – Is Bitcoin a Scam?
History of Bitcoin
Who is the real creator of bitcoin is still an enigma? Who’s behind it?
Bitcoin was developed in 2009. We don’t know who exactly created it. We know the pseudonym “Satoshi Nakamoto” who was active in the forums, was active in the creation of the system. It is interesting that at one point disappeared.
Why disappeared Satoshi Nakamoto?
Perhaps because he realized that the system turns into something that he don’t wanted in the beginning. Somehow he figured out that human nature is such that it will again come to the same inequality.
The team that made a bitcoin was hoping to make a currency for the 21st century. For payment on the Internet without banks.
That was in 2009, and PayPal was new. At that time it was a great idea to do.
They did not take the evil human nature.
It was the anarchist idea. We’ll make our currency. We do not need banks and we don’t need governments. Transactions will go through algorithms and everything will work.
The idea was perfect, but what happened?
1,000 people in the world holds 60% of bitcoins.
They keep bitcoins for them self. Hoping to grow value, rather than using it as an online payment where everyone in the world could have a small part of Bitcoin.
What is Bitcoin Simply Explained ?
Bitcoins are simply explained… numbers in the computer. If someone has a bitcoin it means that there are some numbers on the computer.
More or less the same as fiat currency. Before 1971, the money had adequate value in gold. After 1971 the money in banks became numbers on the computer. There is no drastic differences.
The difference is that behind the bitcoins are not banks, governments and similar organizations.
Who is behind the Bitcoin? Do they keep bitcoins for themselves?
What is Bitcoin mining?
The team that created bitcoin had anarchist views. They wanted a system where algorithms determine how money is created.
Federal Reserve is a private bank. Governments and central banks manage the value of money with a purpose.
The team that created bitcoin said NO. We have the Internet and we are all connected. We have algorithms that decide for themselves creation of a money and then they made the system.
Bitcoin is the most popular, where money is created literally out of nothing. Computers generate bitcoins hitting a random number. It was later called ” mining “.
Today, the mining bitcoin uses more electricity than the entire Ireland.
Every 10 minutes is created a certain number of bitcoins.
How did they provide that? How did they achieve that every 10 minutes is created 12.5 bitcoins ? The bitcoin algorithm achieve that.
The amount of bitcoins is permanent. It is predictable.
For mining bitcoins you need:
- Specialized ASIC chips, which have the purpose only mining bitcoin for anything else
- Expensive to produce
- For each cryptocurrency you need special chip and for nothing else you can not use
Where it is easy to produce? In China.
Who holds 70% of the CPU power for mining bitcoin. China.
Why Bitcoins value growth?
The people “believe” in bitcoins.
People saw that the value of bitcoins is growing and whatever it was I’ll buy… it grows.
Why Bitcoin is not good?
The technical side of bitcoin. The technical solution is not good for a purpose that is advertised.
It is not practical as a currency for internet payment.
Bitcoin is technically a bad solution.
Why is technically wrong solution?
Bitcoin as a network, a system of payments on the Internet can push up to 7 transactions per second.
We have 7.5 billion people in the world, and we have a system that can only 7 transactions per second carried out globally. Really promising currency for online payment. LoL.
Amazon needs the currency which has 600 – 1000 transactions per second.
Visa has approximately ~ 1,600 transactions per seconds, PayPal ~ 400
transactions per seconds..an almighty madness bitcoin ~ 7 transactions
What a promising currency to invest.
How to buy Bitcoin?
There are official exchange office where you change or buy bitcoins for the fiat currency.
You make the wallet and get something called address. It’s like a bank account. It is not addressed to anyone. There is no connection between you and bitcoin address and you can create as much as you want addresses.
If you have a bank card, the money is not on the card. While bitcoins are on a PC, laptop or mobile phone.
If you lose your laptop, cell phone or lose password for cell phone or password for the laptop. No more bitcoin. There is no service which will you give back the money.
If a hacker comes to the bitcoins on the laptop. You lose the bitcoins.
People do not realize the seriousness of security.
They buy bitcoin and keep them on the phone and forget that if somebody steals a cell phone or cell phone breaks down. No more bitcoin.
There are hardware wallets size usb stick (Nano Ledger s or Trezor) where the sole purpose is to store those keys bitcoin.
Conclusion – Is Bitcoin a Scam?
Is bitcoin a scam?
He is not a real scam but it looks like a Ponzi scheme .
That’s not the real purpose off bitcoins.
He was created for online payments NOT for investment, but he is currently to slow for online payments.
Should you invest in bitcoin ?
If you like gambling ? OK invest it …but:).
If you want to start a real online job then you have to do it the right way.
There is no get-rich-quick scheme because almost all are Ponzi schemes or pyramid schemes.