What is Bitcoin? [The most comprehensive information about BTC virtual currency]

What is Bitcoin?

What is Bitcoin virtual currency? Why is it so much attention and investment?

If you intend to invest or simply find out what it is, the "neighbors" talk about it so much!

Then this is the right article for you.

Now, let's find out together with Blogtienao!

Watch now: Latest Bitcoin News

What is Bitcoin?

Bitcoin (denoted BTC, XBT) is called “A .” by its father Peer-to-Peer Electronic Cash System”. That is, a peer-to-peer electronic money system.

BTC is a type electronic money, also known as a decentralized digital currency (cryptocurrency, virtual currency, digital currency).

From the user's perspective, it is quite similar to the currencies on electronic wallets such as Momo, Airpay, ... that people often use.

But what sets it apart is its decentralization. Let's see how in detail to understand better!

First nameBitcoin
Icon
SymbolBTC, XBT
InventorSatoshi Nakamoto
Date of birth03/01/2009
Maximum total supply21.000.000 BTC
Official domain namehttps://bitcoin.org/
Discussion forumBitcointalk
Source codehttps://github.com/bitcoin/
Whitepaperhttps://bitcoin.org/bitcoin.pdf

bitcoin

How is BTC different from regular money?

Before talking about what are the differences between them, let's talk about the common ground first. The common point between these two currencies is that they can be paid and transferred between parties. It's just that simple!

Then what is the other point? Compared to fiat currencies like VND, EUR or even USD, they are usually controlled by the government or central bank.

But for BTC, no one can control it. This is what makes it so special.

In addition, it does not exist in the form of coins, paper or polymer like ordinary money that people use. It exists entirely in digital form.

Compare BTC and fiat money

Who is the creator of bitcoin?

Bitcoin was created by an individual (or organization) but did not want to reveal his identity, so he took the name Satoshi Nakamoto.

Hearing the name will make us think this is a Japanese person. But many people believe that this is not an individual from Japan but Elon Musk.

For those who do not know, Elon Musk is the founder of SpaceX, co-founder of PayPal and Tesla Motors.

But most of the people the community considers Satoshi are denied. Only Craig Wright - Australian scientist and businessman identifies himself as Satoshi Nakamoto.

Because he claimed to be the creator of Bitcoin but could not prove it, CW was named by the community "the Faketosh".

To this day, the identity of Satoshi Nakamoto is only a big question mark.

Watch now: Who is Satoshi Nakamoto?? The most mysterious character of the 21st century

Who is the creator of Bitcoin?

How was Bitcoin born?

In 2008, the world financial crisis occurred due to the US real estate bubble. Followed by Lehman Brothers - the 4th largest US investment bank declared bankruptcy with a debt of $ 619 billion.

The US and world economies wobbled. A series of consequences such as unemployment, business bankruptcy, etc.

Doubts about the traditional banking system arise from here. At the time, the domain bitcoin.org was registered on August 18, 08.

On October 31, 10, Bitcoin Whitepaper was released by Satoshi Nakamoto.

January 3, 1 Genesis Block – the first block on the Bitcoin Blockchain was born. For the first time, a currency that was not controlled by a government or a central bank was born.

How was bitcoin born?

How does Bitcoin work?

Bitcoin works on Blockchain technology. This technology allows you to transact without having to go through a 3rd party.

Blockchain provides a ledger. It contains all transactions on the network.

When you make a transaction, it is first validated by the Miner. The miner here is actually a computer.

This machine does the verification for the transactions. In return, they will receive the usual part of BTC.

Then, if there isn't any fraud, your transaction will be added to this ledger. Means your money transfer is successful.

Blogtienao.com Please give an example for better understanding:

For example:

You have a relative in the UK. If they want to send you money, they will have to go to the bank or transfer it to your VISA card or an online payment gateway.

In general, they have to go through an intermediary and pay a fee. It may take several hours or even days for the funds to be transferred to you.

When the money has passed, you have to go to the bank to wait for the withdrawal procedures or go to the ATM to withdraw. This process takes a lot of time, effort and money.

Moreover, you and your loved ones are choosing to trust the bank.

What if the bank is attacked by hackers? Or has someone in the bank modified your transaction?

But if your loved one uses Bitcoin, it's different. They can still send you money without going through an intermediary.

Just need an internet connection, it only takes 5-10 minutes. They can send you BTC from somewhere in the world.

And of course in Vietnam you will also receive Bitcoin. The transfer fee is almost = 0. Selling it is as easy as gold or dollars at the current exchange rate.

How bitcoin works

Why can we trust Bitcoin?

We can trust Bitcoin because we “don’t need to trust anything”. Sounds confusing right! But that's the truth.

With Bitcoin virtual currency you can transfer it from one person to another without going through another third party like a bank to build trust.

In addition, Bitcoin is open source and completely decentralized. If you are a programmer then you can check how it works.

Every transaction on the Bitcoin network is public and anyone can check it. Once you make a transaction, nothing can edit or reverse it.

Because it is not under the control of anyone even the creator of BTC himself.

Units of Bitcoin

Bitcoin virtual currency also has the unit “Satoshi” after its creator “Satoshi Nakamoto”. Satoshi is the smallest unit of this coin.

We can convert 1 BTC = 100,000,000 Satoshi. That is, one satoshi unit = 0.00000001 BTC. Compared to VND, 1 satoshi is worth more than 1 VND at the time of writing.

Satoshi unit of virtual currency btc

Advantages of BTC

As leading experts assess, the birth of bitcoin marked a historic turning point in the form of electronic payment. Bitcoin brings great advantages and is superior to other coins:

  • Convenience in transactions
  • Bitcoin cannot be faked
  • High security and very safe
  • High security and very safe
  • Extremely low transaction costs
  • Potential for e-commerce development

Convenience in transactions

As with banks or online payment services (intermediaries), there will often be a limit on transferring and receiving money in the day and time.

But with bitcoin, absolutely not. You can send as much as you want, anywhere in the world at any time to your family and friends without anyone managing the amount you send.

Bitcoin cannot be faked

Another advantage of bitcoin is that it cannot be faked, because bitcoin does not exist in a physical form like other currencies.

Moreover, there is no cost to verify bitcoin while gold is very high.

BTC cannot be faked

High security and very safe

All bitcoin transaction information is displayed on the internet, but the identity of the trader does not appear, so information security is very high.

Up to the present time, the protocol bitcoin There is still no security hole to lose users' bitcoins.

btc coin is secure and safe

Extremely low transaction costs

Since there is no intermediary to manage bitcoin transactions, the cost = 0. You only have to pay transaction processing fees on the systems but it is very low.

A transfer of 49552 BTC (~480 million USD) only costs about 0.18 USD. A transaction of hundreds of millions of USD with a fee of less than 5.000 VND.

Can you imagine how low it is?

Transaction 49552 BTC

Environmental Protection

Bitcoin currency does not have to use printing or mining chemicals to create it, so it is very safe for the environment.

The computer system that processes Bitcoin transactions consumes much less power than the current financial system.

Bitcoin currency has little impact on the environment

Potential for e-commerce development

Currently, there are many businesses, companies, and stores that allow the use of bitcoin to pay bills.

Every bitcoin transaction cannot be refunded or reversed, so any fraud is useless.

E-commerce development

Disadvantages of Bitcoin Cryptocurrency

Although BTC has many advantages, nothing is perfect. The disadvantages of this coin can be mentioned as:

  • The number of users is not much
  • Bitcoin is not easy to use
  • Bitcoin price often fluctuates
  • Hackers, criminals launder money

The number of users is not much

Bitcoin is mainly used in developed countries such as the US, China, ... and in undeveloped countries like Vietnam, the use of paper money and gold is already too familiar.

And most people are not knowledgeable about cryptocurrencies. Some groups of people do not have enough knowledge and do not know what is bitcoin then think BTC is virtual unreliable. So they are still shy and afraid to use it bitcoin money.

Not easy to use 

Without knowledge of technology and a real understanding of bitcoin, it is difficult to use and trade it. As described above to use this currency you need to create 1 bitcoin wallet, and exchange it for cash.

Therefore, for those who do not know anything about information technology, they need someone with experience to guide them to do these jobs.

It's not easy to use Bitcoin

Prices often fluctuate

Just like the dollar, euro, gold or stock market, bitcoin also fluctuates in real time.

Sometimes it's up, sometimes it's down, almost any movement in the world that affects cryptocurrencies can cause the price of bitcoin to fluctuate.

For example, when bitcoin was first released, its price was only a few dollars, but at the moment the price of 1 bitcoin has reached more than $1000.

The price of btc often fluctuates

Hackers, criminals launder money

Because of the unregulated form of bitcoin transactions, many criminal groups use this currency as a transaction method.

Hackers can also find and attack many bitcoin exchanges and steal. Besides, money laundering can happen at any time.

Hackers and criminals use Bitcoin

Why is Bitcoin valuable?

Bitcoin is valuable because it possesses characteristics such as currency, silver and gold:

  • Reliability
  • Mobility
  • Exchangeability
  • Scarcity
  • Can be divided
  • Easy to recognize

It's all about technology, not trusting central banks like fiat money. Nor does it rely on physical properties like gold and silver.

But all of the above factors cannot determine the value of Bitcoin. What determines the value of Bitcoin is its acceptance and trust.

Today many businesses accept Bitcoin as a form of payment. This proves bitcoin has value, not something worthless.

Watch now: Bitcoin price today

Can Bitcoin become worthless?

The answer is possible. In the past there have been many coins that have become worthless such as that of Zimbawe, Venezuela.

They become worthless because of hyperinflation, which bitcoin will not happen in Bitcoin. However, there will always be the possibility of the failure of Bitcoin: technical errors, currency competition, politics, etc.

So there is no such thing as a completely safe currency, they will fail or fail at some point.

But Bitcoin has proven itself valuable and has growth potential. However, the future of Bitcoin is unpredictable, right!

Bitcoin is a bubble?

“Is Bitcoin a Bubble or Not?” This is a difficult sentence.

From many perspectives, each person will have different opinions about Bitoin. For example, billionaire Warren Buffett thinks that Bitcoin and other cryptocurrencies have no value.

But for Robert Kiyosaki (businessman, author of the book Rich Dad, Poor Dad) sees this as the currency of the people.

In the past there have been many bubbles that have burst (dot-com, US housing, ...) but after all, Bitcoin is a little different from them.

So is Bitcoin a bubble in the end? This only time will tell.

If it's a bubble, it hasn't burst yet. So when will the bitcoin bubble burst? The answer is when this coin is not useful to people anymore.

It will continue to grow and exist as long as it can be put into practice.

Bitcoin Bubble

Is there any virtual currency that surpasses Bitcoin?

There may be. Because of the future, who knows what will happen in advance, right?

Until now"Bitcoin is King“ is a phrase that is often mentioned in the crypto community. That's right, this coin is like a king of cryptocurrencies.

BTC has a solid foothold. Just like when it comes to buying a mobile phone, you will immediately think of Thegioididong, right?

Bitcoin is the same when it comes to cryptocurrency, people will immediately think of Bitcoin.

But in the future if there is a currency that does better than BTC, it is very normal to be "usurped from the throne".

BTC is the king of virtual currencies

Should you invest in Bitcoin?

Compared to other markets, the cryptocurrency market in general or Bitcoin in particular, fluctuates greatly during the day, sometimes up to several tens of %/day.

It is this factor that many people choose BTC to trade coin (trading) to make daily profit.

In the long term, this is a potential currency if you believe in its value.

Many people have invested in Bitcoin and brought in many millions of dollars in a few years because of the anti-growth of this currency.

In addition, today Bitcoin is also bought by large companies and organizations such as: Tesla, MicroStrategy, Square, ...

 

Of course, investing always comes with risks. There are also many people who lose money because of this currency.

However, the greater the risk, the greater the return.

If you are interested in investing in bitcoin, you can check out some of the articles below:

Watch now: Bitcoin investment guide 2021

Legality in countries around the world

The map below depicts the legality of bitcoin around the world:

  • Green: Legal
  • Vàng: The law does not prohibit, but also does not recognize, controversial.
  • Red: Still controversial but not directly banned.
  • Red: Law against BTC

 

Bitcoin Legality Map

Is Bitcoin legal in Vietnam?

It is undeniable that the convenience and many advantages brought by BTC. But trading it is also risky.

In February 2, the State Bank of Vietnam issued a press release stating that:

All activities using Bitcoin for payment in Vietnam will not be protected and recognized by law, however, it will not violate any provisions of Vietnamese law.

This means that when you buy, sell or invest in Bitcoin with any risk, the state is not responsible.

About buying and selling

Saying so, but now the work exchange, purchase, Bitcoin Mining is still common in Vietnam and even has an intermediary bitcoin exchange based in Ho Chi Minh City. Purpose buy bitcoins then everyone is different:

  • Many people soon realized the potential of this coin in the future, so they bought and stored BTC
  • Some invest in surfing, buy when the price is low and store it to sell for the difference
  • Join bitcoin mining groups, investment networks (HYIP)
  • Join the exchange for receiving

In short, Vietnam does not support the use and investment of bitcoin.

The state issues a warning about the risks users may face. But there is no specific law for this currency.

That is, the state disclaims responsibility for bitcoin or any other virtual currency when people use it without the control of the bank.

About payment

According to Decree No. 101/2012/ND-CP dated 22/11/2012 on “Non-cash payment”. Bitcoin virtual currency is not recognized as a means of payment.

In Clause 6, Article 6 of the above decree on “Prohibited acts” also prohibits “using illegal means of payment”.

In short, using Bitcoin in particular or virtual money in general for payment will be administratively sanctioned. The fine is from 150.000.000 VND - 200.000.000 VND.

So those who intend to use Bitcoin to pay for services in Vietnam right now should not!

Payment in BTC

How to use BTC?

  • Learn more about this cryptocurrency
  • Create a wallet to store and use Bitcoin
  • Buy BTC from exchanges or Bitcoin ATM
  • Use at places that accept payment in BTC

Cryptocurrencies are different from regular fiat money so you have to learn to use them. To find out, you should read this article and related articles.

Use BTC

Where to store Bitcoins?

Perhaps you are wondering how to send bitcoins, with what and where to store bitcoins? Then bitcoin wallet is the answer, bitcoin wallets are used to store, bitcoin transaction.

Some reputable sites allow creating bitcoin wallets such as: Blockchain, Coinbase, Jaxx, Atomic, Exodus, Electrum, ...

Almost bitcoin storage wallet All of them have extremely high security through many layers, If you want to log in, you need to authenticate via email and phone number or you have to enter the google authenticator security code.

However, you absolutely must not reveal your wallet information to anyone. Because if they have credentials to your wallet.

They can make transactions and steal all the bitcoins in your wallet.

There are 2 types of bitcoin wallets:

  • hot wallet
  • cold wallet

Hot wallet is the type of wallet that you know and often use today. For example, Atomic, Exodus, Jaxx, Blockchain are all hot wallets.

(all hot wallet tutorials are in the category: Cryptocurrency Wallet)

The security of hot wallets is also very good. But if your computer or phone has a virus or uses crack software, it's better to reinstall your computer to ensure your safety.

As for cold wallet, then you have more peace of mind about security because even if your computer is infected with a virus, it is difficult for hackers to get your crypto assets.

Watch now: What is a Blockchain Wallet?

Bitcoin wallet

Where to buy BTC?

You can buy this cryptocurrency at Bitcoin ATMs or exchanges. Currently in Vietnam there are 4 ATM addresses in HCM that you can buy this currency

  • The Nguyens Cafe DCT (64 Dinh Cong Trang Ward, Tan Dinh Ward, District 1)
  • Cafe An's (18 Hoa Mai, Phu Nhuan)
  • Italiani's Pizza Han Thuyen (17 Han Thuyen)
  • Italiani's Homemade Pizza (290 Ly Tu Trong)

If you are not in HCMC or want to be more convenient, you can buy through the exchanges below

Watch now: Top 6 Bitcoin Exchanges in Vietnam & the World

Where can BTC virtual currency be used?

Time the years 2012, 2013 in the world they use bitcoin coin to shop online or use online services mainly.

However, starting from 2015 onwards, quite a few companies, businesses and stores have allowed the use of this currency for online and offline payments.

According to a 2020 survey, 36% of US SMEs accept Bitcoin. Some large companies that accept this form of payment include:

  • Microsoft
  • Expedia
  • Wikipedia
  • AT&T
  • Burger King (Venezuela, Germany)
  • KFC (Canada)
  • Subway
  • overstock
  • Twitch
  • Mega.nz
  • Amazon (not directly)

In addition, you can also accept payments with this virtual currency at Coinmap.

Accept payments in Bitcoin

How to exchange BTC to cash?

To exchange BTC for cash, you can choose exchanges in VND. Some payment platforms in VND you can refer to such as:

Buy and sell Bitcoins

Has the BTC cryptocurrency ever been hacked?

Up to now, it has been more than 10 years since its launch, Bitcoin has not been hacked once. This proves that this virtual currency is very well designed.

The hacks related to this currency all come from the exchange. A classic case such as the Mt.Gox exchange was hit with 850,000 BTC.

At current exchange rates, this stolen BTC amounted to $7,4 billion.

There are also many other cases related to BTC being hacked on exchanges. Of course, hackers get Bitcoin by exploiting security holes from the exchange.

This affects the price of BTC but its network is not damaged at all.

How many Bitcoins are there in all?

Bitcoin's supply is 21,000,000 coins, we cannot increase or decrease this amount. The reason why there are only 21 million coins, no one can know.

At the time of writing, there are currently 18,354,862 BTC in circulation. That is only 2,645,138 VND left.

Since the supply is fixed, the only way to get new BTC is to mine bitcoins.

What is Bitcoin Mining?

Bitcoin mining is using software that processes transactions and secures it. In return, the miner will receive the rewards of this coin. The speed of digging fast or slow depends on many factors such as: Hash rate, ...

To avoid this coin being inflationary and depreciated, so it instituted a mechanism called Bitcoin Halving.

Every 210,000 blocks about 4 years the Halving event will take place. The block reward of miners will be halved.

This means that the number of BTC in circulation will decrease every 4 years. Therefore, the percentage of inflation also decreases over time.

The current inflation rate of this virtual currency is ~3.7% according to Woobull. It is estimated that by 2140 (64th Halving) there will be no more BTC to mine. That means % inflation will be 0%.

If you want to learn more about BTC mining then check out the article below.

Watch now: What is Bitcoin Mining??

Mining BTC

Why does Bitcoin need to scale?

Because this is a must for Bitcoin to become a kind of payment instrument serving all people in the world.

Currently Bitcoin can process about 3 transactions/second on average. The reason is that the block size of this coin is only 1MB and the consensus protocol Proof-of-work.

Meanwhile VISA can handle about 4000 transactions per second and has the ability to scale up to 65000 transactions per second.

Therefore, to ensure future growth and use at a broader scale, Bitcoin needs to scale.

Bitcoin transactions per second

Extensible solution

Fork (Fork)

With this solution, to change the transaction processing ability, it is necessary to change the technical issues of Bitcoin such as: increasing the block size, etc.

This process of change is known as a fork or fork. Changes that are compatible with the network are called Soft Forks, changes that are not compatible with the network are called Hark Forks.

Watch now: What are Forks, Hard Forks and Soft Forks?

2nd layer (Layer 2)

The second layer is a framework or a second protocol built on top of the existing blockchain network.

The solution to extend layer 2 for Bitcoin is Lighting Network. It makes it possible to transfer money instantly with almost free fees.

Is Bitcoin a scam model?

If you've been wandering the internet lately, learn about bitcoin and related information. Maybe you will read in the newspaper, watch TV or hear from friends that there are games bitcoin scam. So what is this story about?

First of all, I still want to say it again: Bitcoin is a currency with real value. To be precise, it is a virtual currency but has real value. There is no organization or individual to lead or manage, so it is not guilty.

If you search google with the keyword “Bitcoin scam", there will be quite a few articles about these cases, just like your money and property fraud.

Many sources also suggest that bitcoin could be a multi-level ponzi scheme. However, the report from World Bank (International Bank, an international financial institution) in 2014 concluded that:

Contrary to popular opinion, Bitcoin is not a Ponzi scheme

Often scam models are taking money from the latter and paying the former. The ultimate goal is that the property falls into the hands of the project owners.

But for the BTC coin it is completely decentralized. Not under the control of any one individual.

So we can conclude this is not a scam model. But this virtual currency is used by the bad guys for their own forms of fraud.

Is Bitcoin a Scam Model?

Takeaways

Bitcoin is not at fault in any case of fraud. Whether it's a scam or not is up to people in the user community who create and use bitcoin as a form of fraud.

And also because bitcoin is a virtual currency, many people do not have the knowledge and understanding, so it is not real to refer to bitcoin as a scam.

This Blogtienao.com assertion is completely false.

Bitcoin money is virtual?

"Is bitcoin currency real money?","What do you think about the virtual currency bitcoin?"",.. Blogtienao often get questions like this.

But if you explain it to each person, it is quite lengthy and time consuming, so today Admin decided to write this article for you to have more information about this currency.

Actually bitcoin not virtual money but real money or otherwise called "electronic money".

Many people who are new to it or do not have enough information call bitcoin a virtual currency. This calling is very misleading for those who do not know anything about it.

Because the word "virtual money” refers to something that is not real, usually virtual currency used in a certain community.

For example:

When you deposit money into the game, it is virtual money, it is almost impossible to convert to real money and if so, the value is very low because the two parties determine each other when trading. Moreover, the way to create virtual currency and operate it is completely different from bitcoin.

Opposite is bitcoin coin can be exchanged for real money and has great value. Moreover, this currency is widely used and has international stature. It can be used to buy many valuable things like real money.

The image below is a chart of the bitcoin price movement from 2012 to 2017:

Bitcoin price movement chart from 2012 to present
Bitcoin price movement chart from 2012 to 2017

Will Bitcoin "Die"?

It is a fact that information with negative trends is often received and spread widely by the community than positive news.

Points like bitcoin, for example What benefits does it bring? For users in terms of cost reduction and convenience in payment, the number of people sharing is very small.

In contrast, information like "Bitcoin scam","Bitcoin investment cheated' then it spread very quickly.

And often the people who share it are people who don't even know what is bitcoin.

If you go to google to search, it will also point out inaccurate news, unorthodox newspapers, from which they keep labeling ""cheat" give bitcoin coin.

There are many individuals who do not clearly understand what BTC is. But still speaking out to tarnish the image of bitcoin. Claiming that BTC is a scam, is a multi-level Ponzi, sponsors terrorism…

However, recently, when a number of major newspapers published great news about bitcoin In a positive direction, some sections of the public have begun to recognize and think differently about this coin.

Going through many stages as if "removed”, but bitcoin is still alive and thriving.

Moreover, if you want to stop the bitcoin transaction almost people have to take down the whole internet, so the probability of bitcoin dying is very low.

Bitcoin disappeared

Learn Bitcoin through Video

This is a pretty good Bitcoin video. Check it out to learn more about Bitcoin!

Conclusion

That is Blogtienao.com helped you answer your questions about what is bitcoin? And Should I invest in bitcoin??

Hope these few articles will bring a lot of useful information to you. Also this article will give you a more accurate view of bitcoin coin.

If you have any questions, please leave them below in the comments section. Blogtienao Will reply to you as soon as possible.

Reference source:

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Hi, I'm Hen Vai, Founder of Blogtienao (BTA), I'm very passionate about community, that's why blogtienao was born in 2017, hope the knowledge on BTA will help you.
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