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Bitcoins are frequently in the news recently, and yet much of the population still has no idea what Bitcoin actually is or where they can purchase them.
The process of generating these digital coins is called mining. The easiest way to buy bitcoins is by using a broker. A complex mathematical problem with a 64 digit answer must be solved in order for a Bitcoin transaction to be approved. This where a broker comes in, as they will solve the problem for you. You can buy Bitcoins directly from sellers on other websites and bypass the broker but you must be extremely careful if you are doing this and ensure that the seller is trustworthy.
Bitcoin is a cryptocurrency. This means that it is a peer-to-peer electronic cash system. Put simply, bitcoins are a completely digital form of currency. There is no bank to speak of and no physical currency such as coins, notes and cards. It is created and stored electronically. With this cryptocurrency, the users control the payments, not the banks. This means that it is not subject to rises and falls in value linked to inflation, but it is extremely vulnerable to things like uncomplimentary press reports. It also means that transaction incur either a very small fee or no fee at all because there is no bank to pay.
Bitcoin is still in its infancy, so there aren’t too many businesses (including online retailers) that accept it as legal tender. However, it is exceptionally good for someone wanting to send a direct payment using just an app or website. The payment is anonymous for the large part, as no personal details are sent with the transaction. Users have their own web address to send and receive the coins to and from. Once you have an address, you are free to start trading and buying Bitcoins.
Bitcoin exchange sites have rocketed in popularity in the past few years. Once people understand that using cryptocurrency is just as safe as regular transactions, they embrace it fully. It’s still best to err on the side of caution though and use a broker to do any Bitcoin exchange. An exchange is where traders buy and sell Bitcoins using different monetary tenders, both fiat and virtual. Any Bitcoin exchange is accompanied by a cryptographic maths equation that must be solved used a supercomputer. A broker is a company that will solve the equation and complete the trade for you. They usually charge a small fee for the privilege but it’s worth shopping around as fees will vary.
It may surprise you to learn that the top bitcoin trading brokers for the UK aren’t actually in the UK. Bitcoins can be used to send payments any time across the world, but the UK banking system has been reluctant to serve these companies. As a result, many brokers are within the EU. Bitcoin Trading Brokers that are popular within the UK are Coinbase, Bitbargain, Bittylicious and Coinfloor, but there are many others to choose from. The Bitcoin Trading Brokers all have different transaction fees for completing a transaction and you can even buy Bitcoins and sell them for other cryptocurrencies with them.
Cryptocurrency evaluations are notoriously volatile. Recently, the Bitcoin price history started the week at £7,500 before shooting up to £12,500 before settling at around £11,000. And that’s just in one week. Bitcoin was created in 2008 and no-one is entirely sure who created it. When they first appeared they were worthless, but by early 2011 one Bitcoin was worth the equivalent of $1 USD. By July of that year it was worth $31, but tanked all the way back down to $2 by the end of the year. By spring of 2013 the value had risen sharply to $266 before half the value was wiped off less than six weeks later. After this, its value continued to grow exponentially. By the start of 2017, one coin was worth $800. By the end of 2017 it was worth $17,000!
If you purchased Bitcoins around five years ago and held onto them you’re probably very rich right now. The unpredictability of the value is why banks are so reluctant to catch on to this seemingly burgeoning new form of currency. Much like the stock exchange can close up or down depending on what is happening in the markets, Bitcoin can increase or lose value rapidly. There is substantial money to be made from trading, but there is huge risk as well.
A Bitcoin online wallet is essential if you want to keep track of all your Bitcoins. Much like a physical wallet stuffed full of receipts, your Bitcoin online wallet keeps your public and private address in one safe place. In order to buy Bitcoins and sell them you need two addresses, one public, one private. The public one is much like your email address that you would give to someone who needs to send you an email. The private address is like the password you would enter to access your emails. Because you can have as many public addresses if you like, it makes sense to keep them all in one place, a wallet, so you can keep track of them all. Your wallet can be backed up much like an external hard drive to keep your currency safe.
Much like the Bitcoin brokers, providers of Bitcoin wallets have surged because of increased demand. Without a Bitcoin wallet, you can’t send or receive payments so you need to set up one first. An app like Copay, BitPay, Bitcoin Wallet by Coinbase and Blockchain can be downloaded to all major IOS platforms including apple and Android. They’re free to install in most cases and offer a secure way of doing transactions.
The list of places of who accept Bitcoin has been increasing as rapidly as everything else concerned with Bitcoins. There are now some huge international companies and brands which recognise it as valid currency. Virgin, Expedia, Microsoft and Subway are just some of the big names that have embraced the future and many more are set to follow.
There are plenty of places where you can buy Bitcoin online if you are interested in investing in the cryptocurrency. We would recommend looking at all the different ones that are available before deciding which one to go with.