Bitcoin for Beginners Articles 7. & 8. (Market Review Included)

What Are Bitcoins and How Do They Work?

Bitcoin is the most popular cryptocurrency out of hundreds of others. Cryptocurrency is a type of digital or virtual currency that you can use to pay for goods and services. The value is determined by a myriad of factors. Bitcoin is literally one of the most versatile cryptocurrencies around the world.

Essentially, cryptocurrency is supported by code using complex algorithms that prevent unauthorized copying or fraudulent use or creation of bitcoins. The way it works is that “miners” use a special code to find new bitcoins based on transactions. It’s essentially a digital token that has no physical body, and it represents some unit whose value is usually based on fiat money such as the US Dollar.

Bitcoin is the name of the network that the tokens are stored on, and is essentially a payment network not much different from something like PayPal. The system is decentralized and not run by any overriding governing body or state. There are other open source platforms that are similar in nature that you may understand such as Wikipedia, Moz.com/ugc, and others.

Users are anonymous and identified by a public key. You can have more than one public key and they can be controlled by your pseudonym, or username, or handle – depending on what you want to call it. This enables you to privately purchase the products and services that you want to buy without even the seller knowing who you are in some cases.

You can accept bitcoin as payment, and you can trade bitcoin for fiat money or even other cryptocurrencies. Bitcoin value is subject to wild swings and can be very volatile. If you want to get involved in investing, it’s important to understand that upfront. It can be a wild ride with crazy ups and downs of the value of your bitcoins.

Every transaction ever made using bitcoin is recorded by everyone including miners, by following the bitcoin protocol maintained in the public ledger. The units of exchange can be very small, but they can never be bigger than the number of bitcoins determined to exist in the first place. There are 21 million bitcoins and that’s finite, but the value of each bitcoin and fractions of bitcoins is infinite.

Miners compile recent transactions into blocks, creating block chains that can continue to grow. When a miner solves and proves the work (confirms and records the transaction), new bitcoins are created. It’s an amazing process that some very smart people figured out and if you learn all that you can about it, you will be less likely to make mistakes and get defrauded. You can earn bitcoins by buying them, mining them, or earning them through providing services.


Market Review

Bitcoin close with a bull inverted simillar to a indecition but hand is longer than shadow. Most probably will see a slight fall before pick up for the rest of the week. $10314 is a good buying price .


8.) What Does “Mining” Mean?

One way to learn about bitcoin is to learn the terminology. There are very specific words that are used to discuss bitcoins, and knowing these words will help you not only find more information about bitcoin, but also to explain it to others and to use it properly.

Mining.

This word is simple to understand because even though it means finding bitcoins digitally using specialized software and code, it is a lot like mining for gold. Gold is finite like bitcoin, so the idea fits. Each miner gets transaction fees for each transaction they confirm, and are also awarded bitcoins for each verified block (see below).

Private Key.

This is like your handle or username, but it’s a string of numbers (up to 78 of them) that gives you access to a wallet that contains the bitcoins. It’s more like a password if you think of it, and is tied to a wallet via your alias.

Wallet.

This is a cloud place that enables you to collect private keys and manage those keys to let you make transactions using the bitcoin network. It works just like a wallet that is physical. It contains and lets you access the bitcoins that you have. You can have more than one wallet.

Blocks.

Blocks connect every transaction together, forming block chains that are verified every ten minutes via mining. This process ensures that you avoid double spending, since technically a bitcoin can easily be copied on your own computer inside your wallets. Using this method makes it impossible to spend copies.

Block Chain.

This is the public record of the bitcoin transactions. It’s really a very orderly ledger of blocks, maintaining a chain in chronological order of all transactions. Anyone on the net can download the block chain to view with a block explorer.

Block Explorer.

This is like a browser that lets you look at the contents of blocks so that you can view the transactions and the history of all the balances and addresses of the transactions.

Halving.

Because there will never be more than 21 million bitcoins issued, they are halved every four years with the last one happening in 2140. This essentially means that the number of bitcoins it takes to form a block is decreased by half or 50 percent.

Confirmation.

When a transaction is verified by a network, it’s considered a confirmation. The process that does this is what is known as mining (see above). Once a transaction has been confirmed, it cannot be reversed or changed.

Change.

This is the same concept that you have with fiat money. You pay 5 bucks for something that cost 4.50 and you get back 50 cents. This is no different with bitcoin.

Address.

When you use bitcoin, you provide an address for that particular unit or transaction. Each address can only be used for one transaction.

Signature.

This refers to a cryptographic signature, which is really a mathematical formula that lets someone prove that they own the bitcoin. For example, your wallet and the private keys associated to that wallet, enables you to provide a signature so that no one can steal your bitcoins.

As you learn more about bitcoin and cryptocurrencies, you’re going to come across even more new terms that mean something important. Some of the terms seem obvious (like mining), but others are a little harder to understand. Take the time to learn all that you can so that you can make good choices when it comes to using bitcoin.


Market Review

Dax have posted beautifully with a bull inverted or known as long upper shadow. Bull run will be expected for the whole week. 11551 is a good price to deploy a whole new long position.

DJ30 cited a indecision pattern close last week but is not even. We may see a slight lower before pick up for the rest of the week.


Thank you

Tangoh

Sangoh Tan

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Bitcoin for Beginners Articles 5. & 6. (Market Review Included)

5.) Other Digital Currencies

Bitcoin is the main digital currency that everyone is talking about right now. But, as investors close in on the 21 million coins that exist, other currencies are gaining in popularity. Whether this is a good thing or a bad thing is still unknown. But, when you think about it, any type of money is risky – not just digital currency.

If you want to invest in digital currency, you should learn about the many others that exist. Follow what’s happening, pay attention to the news and what financial investors are saying, and you can be very successful with this type of investing.

1. Litecoin (LTC) – You can learn about Litecoin at Litecoinpool.org. This cryptocurrency is a peer-to-peer online currency that enables almost zero-cost payments around the world for goods and services. It’s becoming quite popular due to the high cost of transactions with other types of cryptocurrencies. Miners get 25 new litecoins per block, which is halved about every four years.

2. Ethereum (ETH) – In order to get more ETH miners, you can work to earn it, or buy it with fiat currency. First, you have to buy a mining contract, which means you agree to give part of your earnings to the mining company.

3. Zcash (ZEC) – This open, permission-free cryptocurrency lets you keep your transaction more private. It shields the sender and recipient as well as the value of the block chain. Yet, the transactions are still safe and fully encrypted. They’re very new, so watch them before you participate.

4. Dash – This digital currency allows you to have digital cash that you can use anywhere so that you can make instant payments privately online or in a store using an open-source platform. You make purchases from your Dash Wallet. Go to Dash.org to find out more, sign up to be a merchant, or to find merchants.

5. Ripple (XRP) – You can use Ripple to make fast payments all over the world online (and offline in some cases) and at a lower cost than bitcoin. The block chain technology that is used is much more scalable and secure than some other types of cryptocurrency.

6. Monero (XMR) – This secure, private, and untraceable cryptocurrency is used all over the world. You act as your very own bank, and no one can see how much you have. You cannot be blacklisted by vendors. It works sort of like the old gold standard that fiat money used to use.

Even though there are other digital currencies, remember that right now bitcoin is the leader. Having said that, it doesn’t mean the others won’t catch up. Many others are becoming popular as people try to think of new ways to pay for what they want.


Market Review

BTC posted a bear inverted at the end of last week chart. Cautious are to be taken despite a unfinish long inverted bfor last week close. Afraid that she will fall first before pick up in the mid week. If pick up first she probably will not cross $10,950 and fall back between 8 to 7 level. Protection order are to be place.


Indexes looks very risky too because the week still post more like a indecision and a bear inverted is longer than the top shadow. She won’t move higher than the resistant indicated. Overall is a fall trend this week.


6.) The Pros and Cons of Using Bitcoins

Whether you call it cryptocurrency, virtual currency, or digital currency, bitcoin is a type of new currency that you should learn all you can about before you buy it, mine it, or use it to pay for products and services. There are pros and cons of using bitcoins that all users should be made aware as they move forward. Let’s look at the main ones here.

Con

* Security Issues – There are some issues with hacking where people have lost their bitcoins. Additionally, there have been issues of fraud where someone misrepresented themselves and were really sending you to a fraudulent website to pay money for non-existent bitcoins.

Pro

* Anonymity Protections – You can buy using your private key, which is essentially a password, up to 78 digits long (and you can have more than one). This is how you make a bitcoin transaction, and you cannot make one without your key.

Con

* Private Keys – This was just a positive and now it’s a con. The reason is that you cannot recover your private key. If you lose it and can’t remember it, you’re out of luck because they are unrecoverable. The best place to store your key is by printing it out on paper and keeping it locked up in a file cabinet or even a safety deposit box.

Pro

* Wallets – Your bitcoins are stored in a wallet that is accessible via the cloud, an internal hard drive, or even an external storage device. You cannot save your wallet on paper, only electronically.

Con

* Hacking – Wallets are great but if you don’t sign in often and you don’t watch your accounts, you’re making yourself vulnerable to hacking. Anytime you store anything on a computer it’s vulnerable to hacking, so it’s essential to use only super-secure servers.

Pro

* Finite Supply – This is a good thing. Fiat money (the money sponsored by governments) is not backed by anything and most money is valued based on the US Dollar. Since there are only 21 million units of bitcoin and there will never be more, it’s just like the old gold standard which is seen by some as superior than fiat money.

Con

* Black Market Activity – Bitcoin is often used for nefarious reasons on the dark web. This means that it can have a bad reputation due to some of its users. This is a shame, because it can erode bitcoin’s reputation and value.

Pro

* It’s Unpolitical – There is no central bank, and no state agency controls bitcoin or its value. A government cannot freeze your bitcoin, and bitcoin isn’t even regulated by its creators. It just exists and can be used by the users the way they want to use it.

Understanding the myriad of issues surrounding cryptocurrencies and all the pros and cons of them is essential to know the potential risks and rewards. That way you can move forward with an understanding of what you’re doing. When you do that, you can protect yourself from fraud and make better decisions.

Thank you

Tangoh