What is a Bitcoin and how does it work?

 In this post, we will know what is Bitcoin, how does it work? If you view its photos, then it seems like a golden coin. Most of the people who do not know about cryptocurrencies assume it to be a golden coin. But it is not like this at all, Bitcoin is a sort of digital cash, unlike any traditional currency. Which does not have any physical form. That is, it is utilized solely on the Internet.

Just like one rupee has a value, in the same manner, 1 bitcoin has its worth. Overall, this is also a type of currency. But there is a lot of difference between ordinary cash and Bitcoin, which we shall know in full today. 

So in this post, we will offer knowledge about bitcoin in Hindi. Under this, we shall learn what is bitcoin? How does bitcoin work? And how to purchase bitcoin. Let us first grasp what is bitcoin.

What is Bitcoin?

Bitcoin is a kind of electronic cash, which is termed Cryptocurrency. It is generated electronically on the computer. That is, Bitcoin does not have any tangible presence like a note or dollar, but they are kept online in a Bitcoin wallet. That is why it is sometimes termed virtual currency.

Like conventional cash, it is not operated by any bank or government, but it is a decentralized digital currency. For example, when you perform a transaction from account 1 to account 2, then an intermediary (bank or government) is needed to make the transaction successful.

This does not happen in the context of Bitcoin, although peer-to-peer technology is employed in it. That is, all the participants on the network are connected so that no intermediary is needed when performing the transaction. So Bitcoin is open-source, everyone may use it.

Its transactions are validated by the network nodes using cryptography. After this, the specifics of such transactions are kept in a decentralized ledger system called Blockchain. This complete procedure is defined as Bitcoin Mining.

Miners that execute this mining procedure earn Bitcoin as a reward. Similarly, fresh bitcoins appear on the market. This is a fixed asset i.e. only 21 million bitcoins can be created and till now 80 percent of it has been mined. We may convert Bitcoin for other currencies, products, and services.

Who developed bitcoin and why?

Bitcoin was launched in 2009 by a person named Satoshi Nakamoto. Although the identification verification of the person of this name has not been done yet. 

There is also news that it might be a collection of individuals and not a person. But a question that must have occurred in your mind is that why was Bitcoin created?

The veil on this enigma comes when you look at a proposal published by Santoshi Nakamoto. Its title is as follows, under the topic “Bitcoin: A Peer-to-Peer Electronic Cash System”, comprehensive information on bitcoin has been presented. In one of its passages, the aim for developing Bitcoin seems to be.

He has argued that the main problem with conventional currency i.e. traditional currency is that we have to depend on the financial system for it. They also feel that our money in banks is not fully safe and they scam us a lot in the name of the plan. If you look at history, then it is also true that many such instances have happened.

How much is the value of 1 Bitcoin?

The value of 1 BTC (this is the nickname of bitcoin) is now ₹ 6,00,482.87, corresponding to roughly six lakh Indian rupees. However, its value changes continually. In December 2017, it hit its highest ever price - ₹ 1,259,942. Maybe, your query may be who sets the value of Bitcoin.

There are numerous variables behind determining the value of Bitcoin. The most notable among these is the supply and demand of Bitcoin. 

The greater it is, the more its price will grow. To some extent, it is also depending on the cost of the mining procedure. Apart from this, numerous factors affect the price of 1 BTC.

How to Invest in Bitcoin | How to Invest in Bitcoin

Anyone interested in cryptocurrencies can start investing in Bitcoin. Although it is not so easy for a regular person, not at all. Investing in Bitcoin involves buying it and selling it when its price is high and generating profit from it. But you may be thinking that the price of bitcoin is quite high.

It is not required that you buy 1 BTC straight. You can buy even its tiniest units. Just like there are 100 paise in one rupee, in the same manner, 100 million Santoshi collectively create one BTC. So you may gradually create a BTC by buying these tiny pieces.

There are several things that an investor needs to start investing in Bitcoin:

1) To have your KYC confirmed, submit PAN Card and valid address proof.

2) Select Bitcoin Wallet. These are applications that enable you to store and sell Bitcoin. Zebpay, UnoCoin, and Coinbase are the finest bitcoin wallets.

3) After picking one of the wallets, you have to join up and establish your account so that you can use them.

4) Connect your wallet to a bank account, debit card, or credit card.

5) Finally you buy Bitcoin. You may also start this by buying a small unit of bitcoin.

One thing that you have to keep in mind is this is a risky investment. So collect as much information as can about it. If you do not want to take a big risk, then invest in its tiny pieces. Use a more secure bitcoin exchange.

What is Bitcoin Mining?

This is the method through which fresh bitcoins are produced. Understand this, when you transact bitcoin, it is the responsibility of bitcoin miners to verify them.

 Although there can be no one but many miners for mining. The one who first uploads the record of that transaction to the Bitcoins public ledger (Blockchain) gets paid BTC as a reward.

Bitcoin Mining is done by some specialized machines. Using their processing capacity, miners try to validate the transactions. Mining is an important process, it not only creates new bitcoin but also maintains the bitcoin network safe.

Through this verification procedure, it is guaranteed that only legitimate transactions are recorded on the Blockchain.

How to perform bitcoin mining?

It is commonly heard that people are making crores through Bitcoin mining. The item is true but this procedure is not easy at all since for this you need many resources which are quite pricey. That is, this is not labor for a regular person. Let us still explain to you, how can you conduct bitcoin mining.

To start Bitcoin mining, you will require Bitcoin mining hardware. Although before this job was possible using computer CPU or high-speed video processor card. But today this is not possible.

Power usage in this procedure is much more than you believe. So if you want to perform Bitcoin mining then this process consumes more power.

After performing the above steps, you will have to download a special program for BTC mining. For example, CGMiner, BitMinter, and BFGMiner are the most popular.

Now you have to join the Bitcoin mining pool. This is a group of bitcoin miners that try to solve a block and split its rewards among themselves.

In the end, you will have to set up a BTC wallet where you will obtain a unique address, so you will be able to get the bitcoin you earned in reward.

Is Bitcoin Legal?

Yes, now Bitcoin is legal in India. In April 2018, RBI (Reserve Bank of India) banned cryptocurrency trading. That is, then no Indian banks or other financial institutions used to give any type of facility on these virtual currencies. Although cryptocurrency was illegal in most of the developed countries then.

After this, the Indian crypto community launched a case against the RBI at the supreme court of India. After almost two years, the Supreme Court decided in favor of the Indian crypto community. Now Bitcoin is legal in India. Although it is not that popular however that we use it as traditional currency.

How does bitcoin work

As we learned it is digital money that exists only online. Along with this, it is decentralized i.e. no one owns it. Then how does bitcoin work? Understand that just like gold is an asset, BTC is also a digital asset that has its worth. We save it in the Bitcoin wallet.

Using this wallet we may purchase and trade BTC. Each wallet has a public key and a private key. The public key is that unique address with the help of which you get BTC. The private key functions as a digital signature.

Whenever you send bitcoin, computer nodes verify that transaction with the aid of this private key. Just like you sign when you deposit or send money to the bank. From here the labor of miners began. The process and verify each BTC transaction and add them to a block. We call this a public ledger.

After this, the miners publish that block on the Bitcoin network. With this, that transaction is uploaded to the blockchain along with the preceding blocks. In exchange for mining, the miners earn some bitcoin as a reward. Those who come to the new bitcoin market, they arrive in this way.

Future of Bitcoin

Those who invest in bitcoin are frequently worried about its future. Because it is not a fixed asset, its value goes on changing continually. Bitcoin is also a cryptocurrency, which employs an innovative encryption technology called cryptography.

Seeing its value rise, it sometimes looks that digital currencies will replace today's conventional currencies in the coming times. But sometimes it appears like it will not endure long. So what is the answer to this confusion? If you listen to economic analytics, they believe that a big change will happen shortly in crypto.

That is because Bitcoin has many features that may offer benefits to any person. If its disadvantages are to be worked on and made more secure. So that it is easy for people to use it. So definitely its future will be better.

Conclusion

In this article, you know what is Bitcoin, how does it work? Under which we gave you complete information about bitcoin. By reading this post, you can understand it better and you can learn to invest in it. If you are interested in money then this is much more important for you. Also, we should not forget that Bitcoin is an Unpredictable and Unstable currency, that is, it is a high-risk asset.

So hopefully, this post What happens to bitcoin? You must have got to understand a lot from (What is Bitcoin in Hindi) (What is Bitcoin in Hindi). If you have any queries or suggestions relating to this then please tell in a comment. In the end, if the post is useful, then do share it with your friends on social media like Facebook, Twitter, Instagram.