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What is Bitcoin for Dummies: A Guide For Beginners

What is bitcoin? It’s digital money. It’s the new gold. It’s hot and everyone wants a part of it.

Love Bitcoin — Stick-Figure by Decryptionary.com

Let’s start with “currency”

What about Crypto?

  • Control how it was made
  • Protect transactions
  • Hide the identities of its users.
The Cycle of Money — Stick-Figure by Decryptionary.com

Enter…Bitcoin

Bitcoin Versus The Dollar

Bitcoin Vs. Dollar — Stick-Figure by Decryptionary.com

Enough with the fear tactics, let’s dig into bitcoin.

Peer-to-Peer Transactions — Stick-Figure by Decryptionary.com

Right…Now I want to bake me some bitcoin

  1. Every bitcoin transaction is recorded and verified on a public, digital record. There are over 7,000 people using their computers to simultaneously keep identical records of these transactions. The purpose of so many records is to reduce the risk of any single person or group manipulating and falsifying the data. In other words, public records provide transparency, security and ensures bitcoin transactions are permanent.
  2. Mining is the computer process of recording and verifying information on the digital record known as the blockchain. There are many different ways to mine but bitcoin mining also requires computers to solve a tough math problem.
  3. Because mining requires computer power, people do this work in return for money.Miners are paid in transaction fees, that’s a small amount of bitcoin paid by people like you and I when we send bitcoin. Another incentive to mine is that the first computer to solve the math problem will earn 12.5 new, virgin coins. (Virgin coins are “uncirculated” bitcoin. In other words, no one has ever used them.) At the time of this writing, that’s equal to nearly $86,000.
No Institutional Control on Bitcoin — Stick-Figure by Decryptionary.com

Okay… But what do I use bitcoin for?

McClaren Dealership in Newport Beach, CA Accepts Bitcoin — Screenshot taken from http://www.rdsautomotivegroup.com/

How do you actually pay using digital currency?

  1. You install a bitcoin wallet on your phone and make sure your bitcoin is accessible on your device.
  2. Using Bitpay, McLaren Newport Beach will create an invoice with a barcode on it.
  3. Using the bitcoin wallet app on your phone, you will scan the barcode.
  4. The wallet will ask you to confirm the details of the transaction.
  5. Once confirmed, you will generate payment and become the proud owner of a McLaren!
Screenshot of Bitcoin Price — Screenshot taken from https://bittrex.com/
  1. A new way to transact outside of the government.
  2. A way to gain 100% control over your money, outside the sphere of influence of any organization, government, or bank.
  3. A new, very volatile investment that has probably made as many fortunes as it has broken.

OK, how do I get me some bitcoin?

Purchase Bitcoin with Credit Cards — Stick-Figure by Decryptionary.com
  • Probably the simplest way to buy bitcoin is through Coinbase. They may not be the very cheapest, but they are one of the easiest. After plugging in your credit card numbers and verifying your identification, you can make your first purchase.
  • Coinmama is another popular way to buy bitcoin with a credit card. Their fees are much higher than Coinbase but have fewer identification requirements.
  • Bitpanda is a popular method to buy bitcoin in Europe. Their fees for credit cards aren’t very low either, but they are probably as easy as Coinbase.

Where do I keep them?

What’s Next?

Originally Found at MRKTRS.co

About Decryptionary

My mission with Decryptionary is crypto made simple.

Beyond a Dictionary — Stick-Figure by Decryptionary.com
Walkthroughs — Stick-Figure by Decryptionary.com

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The Simplest Cryptocurrency & Blockchain Dictionary-Featuring 250+ definitions, stick-figures, and walkthroughs, this is crypto made simple. Learn more at Decryptionary.com

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Dani Amsalem

I'll show you how to understand cryptocurrency and blockchain. Learn more at Decryptionary.com