Millennial’s guide to understanding bitcoin

By now, you have probably seen a lot of posts in your social media newsfeed or heard a friend talk about bitcoins.

For some millennials who are still unaware of how it really works, here are a few definition of terms to get you started:

1. Bitcoin (BTC) – a form of digital currency created by a certain Satoshi Nakamoto in 2009 to provide an electronic payment system where users can transfer funds instantly with low transaction fees.

2. Satoshi – the smallest unit of the bitcoin currency (0.00000001 BTC) and named after the creator of Bitcoin.

3. Bitcoin Wallet – this is a software program where Bitcoins can be stored. Think of it as a physical wallet but digital. Users need to register to be able to be given a Bitcoin Wallet address that one can use to receive and send bitcoins.

4. Blockchain – an incorruptible, decentralized digital ledger for all cryptcourrency transactions.

5. Bitcoin Faucets – these are websites or applications offering satoshis as reward for completing a certain task.

6. Cryptocurrency – a form of digital money wherein mathematical theories and in-depth computer knowledge was applied and encrypted to secure vital information, communications and money digitally. A popular example is the bitcoin, etherium and litecoin.

7. Cryptocurrency trading – similar to the Stock Market, cryptocurrencies can also be traded and converted to US Dollars and vice versa.

The Evolution of Bitcoin

When Satoshi Nakamoto invented Bitcoin, he never intended to make a digital currency. He invented the program with the concept of a Peer-to-Peer Electronic Cash System eliminating the need for a middleman and lowering transaction fees. Building the decentralized digital cash system gave birth to cryptocurrencies.

As people take notice of this brilliant system, trading followed. From its original value of $1 to 1 Bitcoin (BTC) in 2011, its worth is now a whopping $10,833 as of this writing. It even reached a peak of $19,000 last December 2017. The success of bitcoin influenced the proliferation of new cryptocurrencies such as Etherium, Litecoins and many more.

Obtaining Bitcoins

Collecting bitcoin starts with the registration for a bitcoin wallet. Searching the internet may yield hundreds in results but do take note to always check for legitimacy of the website before signing up.

In the Philippines, the first financial service platform for bitcoin is the Coins.ph. Upon registration, users should verify the needed information and submit Identification cards for approval. When approved, one can now use the system to either send or receive bitcoins and avail services such as paying bills and buying load in an instant.

As mentioned above, one can obtain bitcoins through collecting Satoshis online. Several websites and mobile applications reward users with a certain amount of Satoshis after completing a task. Payout request can be made when they reach the minimum payout set by the company. But since this is just free, patience is a must since time is the investment in collecting. Waiting time for claiming varies from 5 minutes to an hour.

One can also buy bitcoin by depositing money to your Coins.ph account and converting it to bitcoin. Once converted, the amount invested may change depending on the value on the Bitcoin market. If you are a risk-taker and would like to try cryptocurrency trading, look for legitimate bitcoin trading platforms that offer sensible returns.

Tips

When venturing into the world of bitcoin, it is advisable to read up on how the system fully works, its upsides and its downsides.

Preferably, start small and invest only what you can afford to lose. Bitcoin is a good income generating program when played right. But the risk of losing some or maybe all of your money is also possible.

It is also advisable to always double or triple check when joining websites due to the proliferation of scam sites that offers a hundred percent or more returns per day. Not only will your money vanish, but the possibility of hacking your vital information is probable. Again, invest only what you can afford to lose.