#BTC☀️
What is Bitcoin and How Does It Work?
Crypto
Beginner
written by Julio Alves | updated November 28, 2024
What is Bitcoin
In this article, we will understand what Bitcoin is and how it works. We will also talk about its origin, advantages and disadvantages, creation of Bitcoins, purchase, sale and investment, factors that influence its value, the concept of blockchain, virtual wallets and much more!
What is Bitcoin?
Bitcoin was born in 2009 and is a cryptocurrency, that is, it is a digital currency that works as a means of payment and as a form of investment. It has no physical existence and is not controlled by any country or central bank, nor is it backed by an underlying asset, such as gold. Bitcoin is a virtual currency whose value varies constantly, and can rise or fall with great volatility in many cases.
Each Bitcoin has a code that is stored in a digital wallet called a “wallet”, which allows Bitcoins (or parts of a Bitcoin) to be sent or received by other people or companies.
Thus, Bitcoin is a decentralized digital currency that allows transactions without intermediaries, a characteristic of cryptocurrencies. It uses “peer-to-peer” technology, which facilitates transactions between the parties involved, who send and receive Bitcoins through a digital wallet that has a Bitcoin address, something similar to a traditional bank account.
The total issuance of Bitcoins is limited to 21 million “tokens”, or units, and this number is reduced by half every four years, in events called “halvings”. To date, 19.5 million Bitcoins have been issued (2023). The next halving is expected to occur in 2024.
