Bitcoin is a digital currency, also known as a cryptocurrency, due to the fact that it uses cryptography to secure transactions within its infrastructure. This infrastructure is an online database or so-called blockchain technology.
Bitcoin has offered alternative payment methods at lower fees and commissions and higher speeds. But perhaps the biggest advantage of Bitcoin payments is the extremely high level of security. Bitcoin's financial history dates back to 2010, although it was created in 2009.
The creator of Bitcoin is considered to be a person (or group of people) with the pseudonym Satoshi Nakamoto, who presented his invention on October 31, 2008 in a document called Bitcoin: Electronic user-to-user cache system .
There are no physical Bitcoins, only balances that are kept in a public book to which everyone has transparent access. This way all Bitcoin transactions can be verified. It should be noted here that behind the largest cryptocurrency does not sit, not a single bank or government.
What is Blockchain technology?
Each Blockchain technology is essentially a decentralized public register of all transactions that have ever taken place. A number of transactions form a unit of database called a "block".
Each block contains information about the previous block, and each transaction stores information about the previous transaction. In this way, the chain of blocks called Blockchain allows full transparency of payments.
The Bitcoin blockchain has unveiled a revolutionary financial data storage infrastructure that is accessible to anyone, completely transparent and developed using open source that does not belong to any organization or individual.
Instead, Blockchain is supported by the collective power of millions of computers around the world that check transactions and add them to chain blocks. Collectively verified transactions cannot be changed or deleted, so Bitcoin payments are final and undisputed.
How does Bitcoin work?
Bitcoin offers the ability to make fast, secure and cheap user-to-user payments without the need for bank intervention or another centralized system. Bitcoin system transactions occur directly between users' digital Bitcoin wallets and are verified in Blockchain technology. Independent individuals and companies that have the control computing power and participate in the Bitcoin network consist of nodes and miners. * Miners are the people who process Bitcoin transactions in Blockchain and are motivated by rewards paid in the form of Bitcoins. * Nodes are a collection of computers that manage Bitcoin code and store its Blockchain technology. The fundamental value of Bitcoin is largely related to the extraction process and the cost of electricity and hardware, while the rest of its value is determined by its limited quantity and growing demand.
What is the abbreviation for Bitcoin?
The abbreviation of the largest cryptocurrency Bitcoin is simply BTC. The same principles apply to the formation of this abbreviation as for other currencies: USD (US dollar) and EUR (euro). BTC can form currency pairs with traditional currencies or cryptocurrencies. For example, the ratio between Bitcoin and the US dollar is depicted as BTC / USD, and contracts for the difference on this pair are denoted by BTC / USD CFD. Test trading with Bitcoin CFDs and more than 10 cryptocurrencies without risking equity with a demo account from Admiral Markets.