What is Bitcoin and how do I buy Bitcoins?
Bitcoin is a payment network on the internet that enables users to use digital currency to purchase items. It requires no middlemen or regulatory authority and is controlled by the users.
The network is regulated by software and the users who are in agreement with how the system works and the software running it. Simply put, it is basically money for the internet. The original software was created by Satoshi Nakamoto.
Why use Bitcoin?
The fact that there is no reliance on regulation by a bank, government or any other central authority makes it a system that is freely operated by its users. Users are free to control their money, how they spend it and how they trade.
The payment system allows for rapid transfer of any amount of money to any part of the world. This ensures that funds are received quickly and can be spent immediately.
It is a transparent mode of payment as all relevant information on Bitcoin and its supply is accessible to all to verify and make use of immediately. This ensures a neutral and predictable system that can be relied on.
They cost very little, in comparison to other payment networks. There are also minimal or no processing fees. The fact that they are handled peer-to-peer makes them cheaper and simpler as well as there are no third-parties involved.
It is a safe mode of transaction as the system is highly guarded using cryptography, similar to the kind used to protect online banking. The payments do not require the users’ personal and confidential information so this limits cases of identity theft. Transactions are also irreversible and can be encrypted to further secure the user’s money. As a result, the details of the transaction cannot be tampered with.
How to buy Bitcoins
To buy Bitcoins, you will need to first install the Bitcoin software on your computer. The software is readily available as it is free and open sourced, and is necessary to set up your Bitcoin wallet. Your wallet will be automatically created once the download is complete and your Bitcoin address will be set up. You will then be able to start receiving Bitcoins.
There are several ways of purchasing Bitcoins and these include over the counter exchange, where you can go online to the Bitcoin exchange and find a direct seller who wants to trade their Bitcoins for cash. You can also opt to trade in person, where you can meet with someone in your locality who is willing to sell in person and trade your Bitcoins with them for cash. Paying for Bitcoins can be done in several ways; you can purchase Bitcoins on sites that accept card payments such as credit cards and prepaid cards. You can also pay for Bitcoins using international money transfers across the world. If you prefer to buy Bitcoins with your online wallet, like Paypal, Skrill and Neteller you need to go through an extra hop of buying virtual currency and exchanging that into Bitcoins.
Whatever method you opt for, remember to always confirm that the site is secure and establish the real seller’s identity whenever possible. Some sites even have the seller’s reputation on record and there are ratings by percentage or stars so you can know how reliable the seller is.
Once you have Bitcoins you can choose to trade and invest your Bitcoin in virtual mining markets, to gain more Bitcoins.