There's virtual money, and then there's Bitcoin. The super geeky Bitcoin is a mathematically-derived currency that promises to change the way people use money. Bitcoins are not real coins-they're strings of code closed with military-grade encryption-and people who use them to deal goods and services are difficult to hint. Along with incognito drug dealers, Ashton Kutcher and the Winklevoss twins have apparently jumped on the bandwagon. There's something to be said about using currency that isn't regulated by the government or banks, doesn't come with typical transaction fees and is impossible to phony. Bitcoin also promises to be disaster-proof, because you can't destroy numbers quite as that you can destroy gold supplies or paper money.
What is Bitcoin?
Bitcoin is a digital currency created just last year by a developer hiding under the pseudonym of Satoshi Nakamoto (supposedly a Japanese people guy who has perfect command of American English). Bitcoin is decentralized, meaning it is not controlled by a central authority like a financial institution, country, government or individual. It is peer-to-peer and open-source, distributed across the internet from computer to computer, without need for middlemen. Compared to You. S. dollars, Bitcoin is virtually untraceable, making it easy for libertarians afraid of government meddling and denizens of the underworld. bitcoin to euro You can use it to pay for purchases online and off, from illegal drugs on the Silk Road to straight restaurant meals.
Where you can get Bitcoins
You can get Bitcoins from friends, online free gifts or by buying them with a real income from Bitcoin transactions. Using a real income to buy Bitcoins beats the whole purpose of anonymity, however, because you might want to add your bank account to an authorized site. You can also buy Bitcoins using your mobile phone or through cash deposit establishments. New Bitcoins are created by "mining. inch Mining is done automatically by computers or servers-it's not real-world mining where you have to dig underground to explore items, but the concept is similar. You have to exert effort to dig up gold, and you (or your machine) also have to spend time and resources to verify and record Bitcoin transactions.
One of the freshest looking reasons for Bitcoin is that it gets its value not from real-world items, but from codes. Bitcoins are pulled out of the ether by machines (and the people who run them) in exchange for curing complex exact problems related to the current number of Bitcoins. These big and pricey supercomputers come with powerful encryption capabilities (and apparently stink electricity like nobody's business). In a typical transaction, buyer A from location X pays seller B some Bitcoins online. Miners then race to authenticate and encrypt the transaction, carrying Bitcoin codes in a central server. Anyone handles the challenge first gets the Bitcoins. About 25 new Bitcoins are created for every 10-minute block, but that number can increase or decrease depending on how long the network runs.
How to Use Bitcoins
Once you get some Bitcoins, you need to store them in an online wallet via the computer program or a third-party website. You become system of the Bitcoin network once you create your virtual wallet. To send Bitcoins to another user or pay for online purchases, get that person/seller's identification number and transfer Bitcoins online. Processing takes about a few minutes to an hour, as Bitcoin miners across the globe verify the transaction.