Bitcoin and cryptocurrency are the talk of the year. Today, the price of bitcoins has reached over $16,500 per coin from $500 per coin within past 12 months with the market cap more than $270 billion. Besides Bitcoin, Ethereum, Bitcoin Cash, Ripple, Dash, Litecoin, and NEO are other major cryptocurrencies in the market.
![Bitcoin.jpg]( "Bitcoin.jpg")
The growth of Bitcoin has attracted so many new investors from around the globe. But what amazes me is how few people really understand what Bitcoin is all about.
In this article, I’ll try to explain it in a simple language that even a dummy could understand.
So, what exactly is Bitcoin?
Bitcoin is a digital currency also known as cryptocurrency or virtual currency, build on top of the blockchain technology. Yes, bitcoin is nothing that you can print, touch, feel, or store in your safe or wallet. Bitcoin is virtual. Technically, bitcoins are bunch of numbers (0s and 1s) stored on a bunch of computers around the world.
Bitcoin is built on a technology called blockchain. Blockchain is the reason why Bitcoin is so popular. Blockchain is a technology to create, store, and manage digital transactions that are public, secure, and distributed. You can learn more about blockchain here: What is Blockchain.
Why Bitcoin?
Bitcoin was created in 2009 by an unknown individual or a group named “Satoshi Nakamoto” to provide a way to pay for transactions without a third-party like a bank. The transactions occur between two parties without any middlemen.
There are no transaction fees and both parties are anonymous. When you buy bitcoins, you get a unique digital address that becomes your identity, and that address is used for every transaction.
Some pundits predict that Bitcoin (and cryptocurrency) is the future of money. They say, eventually, actual physical currency will start diminishing and digital currency will start appearing. Time will tell!
What can I do with bitcoins?
Today, many tech-savvy online retailers accept bitcoins. You can order services like Web hosting, buy merchandise, and even a coffee. Many online shopping carts that accept bitcoins will have an option similar to the following cryptocurrency icons: Bitcoin, LiteCoin, and Dogecoin. Here is an example of DirectNic offering cryptocurrency payment options.
![Bitcoin-Payment.jpg]( "Bitcoin-Payment.jpg")
Where do I buy bitcoins?
There are several cryptocurrency marketplaces (online websites or apps) called “cryptocurrency exchanges” that allow people to buy or sell bitcoins using different currencies. You can buy bitcoins using your local currency and start buying and selling bitcoins like any stock trade.
When you open an account, you get a digital address and that address is your identity to buy, sell, or pay in bitcoins.
Here is a list of some of the top cryptocurrency exchanges.
- Coinone
- Bitthumb
- Bitfinex
- Quoine
- Bittrex
- HitBTC
- Poloniex
- Kraken
- Coinbase
- Bitstamp
![Bitcoin-Distribution.jpg]( "Bitcoin-Distribution.jpg")