What is Bitcoin?

For Beginners

What is Bitcoin?

Bitcoin is the first and biggest cryptocurrency, but it’s more than that. It’s a project that was launched in 2008 specifically to combat the limitations of the regular financial system. Bitcoin offered a transparent network, where any two participants could exchange funds without any oversight or control – only the underlying algorithms meant to prevent fraud.

It didn’t catch on immediately, but by 2012 it’s become one of the most talked-about technological novelties in this century (so far). Bitcoin created the first-ever blockchain, which is basically a network of decentralized blocks that can communicate with one another, thus facilitating financial exchange. It’s pretty simple, but the system is nonetheless incredibly flexible.

Key Takeaways

So, what is Bitcoin and cryptocurrency? Here are several takeaways:

  • The main detail about Bitcoin is that it’s a ledger of transactions that have ever and will ever happen in its system. It’s not just a cryptocoin. Said coin, BTC, became popular specifically because of this new, exciting way to move money.
  • The transactions are transparent and secure. You always know how much you sent and how much you receive, and you can always take a look at what happened during that exchange. These actions are anonymous, and there’s no controlling body overseeing each transaction.
  • Bitcoin is decentralized. This word is often used to describe Bitcoin and crypto. It basically means that each element in this system isn’t tied to a location. They are all over the place, and two people from opposite ends of the world can exchange funds just as easily as people in the same room.

What is it for?

So, what is Bitcoin function-wise? It’s a valid question because many of the recently launched cryptocurrencies have some peculiar details. Ethereum has smart contracts, Ripple ensures cheaper and faster transactions, while Tether is tied to the value of the American dollar. Bitcoin is a purely financial tool, but there are still many possibilities.

In fact, since it’s an established name on the market, it’s the go-to tool if you want to move crypto funds around. Most solutions that enable the receiving or sending of crypto funds are based on Bitcoin. It’s the most widely used and popular blockchain, and it’ll likely stay that way forever.

What is Bitcoin’s investment potential? It is incredible for investments, as well. That’s what a lot of people use it for, anyway. Bitcoin can be used for other uses, of course, such as the development of decentralized projects. It really shines, though, when it comes to investments.

Tipping, donating, and holding for interest are also popular and excellent uses for Bitcoin. There are lots more things you can do with it, but it’s not very good for developing apps, for instance. Although it can be used for it, it’s really better used for moving money around.

So, answering the question of ‘what type of currency is Bitcoin?’, it’s really just a regular coin meant for monetary transactions.

Bitcoin Mining

Mining is a commonly used word when talking about crypto. It’s particularly closely associated with Bitcoin because of its immense popularity. It’s essentially a process of creating new coins at a very slow rate using the ingrained proof-of-work algorithm that rewards people with new coins in exchange for some action.

It’s a legitimate way of making money, and it doesn’t overly dilute the value of Bitcoin. In later years, it even became mainstream to set up farms of hardware to mine Bitcoin as some processing power is required for the process. Although this money is seemingly created out of thin air, only 21 million BTC can ever be created because of the algorithmic limitations. What happens next is a problem for future generations.

Bitcoin on CoinDepo

The CoinDepo platform supports Bitcoin (BTC) as one of the main cryptocurrencies. With CoinDepo, you can safely store your Bitcoins in Compound Interest Accounts and earn from 12% to 18% per annum + compound interest, depending on the type of interest account you choose. Today, without exaggeration, this is the best offer on the market. 

You can also borrow other major cryptocurrencies and stablecoins from CoinDepo against your Bitcoin portfolio without opening a collateral account, which is a unique service that has no analogs in the world of digital assets.

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