Bitcoins are a decentralized form of cryptocurrency. This means that they are not regulated by a financial institution or government. As such, unlike a traditional bank account, you do not need a long list of documents, such as an identification number, to identify what is known as a bitcoin wallet. The Bitcoin wallet is what you will use to access your bitcoins and send bitcoins to others.
How to set up an account
You can buy a bitcoin wallet from a bitcoin broker like Coinbase. When you open a wallet through a certified broker, you get a bitcoin address that is a series of numbers and letters, similar to a bank account number and a private key, which is also a series of numbers and letters that serve as your password.
How bitcoin works as an anonymous payment processor
You can do 3 things with bitcoins, you can make a purchase, send money anonymously to someone or use it as an investment. More and more merchants are accepting bitcoins as a form of payment. By using bitcoins instead of cash, you are essentially making this purchase anonymously. The same goes for sending money, based on the fact that you don’t have to file a payment mountain to establish bitcoin anonymously, you can essentially send money to someone else anonymously.
How bitcoin works as an investment
The price of bitcoin fluctuates from time to time. Just to put things in perspective, as early as the beginning of 2013, the average price of bitcoin was approximately $ 400 per bitcoin, but by the end of 2013, the price of bitcoin had risen to over $ 1,000. This meant that if you had 2 bitcoins worth $ 800 in early 2013 and kept them as an investment until the end of 2013, those two bitcoins would cost over $ 2000 instead of $ 800. Many people store bitcoins due to the fact that their value fluctuates.
Bitcoin casino and poker sites
Due to the anonymity of bitcoin, the gambling industry has adopted bitcoin as a method of payment. Both bitcoin casinos and bitcoin poker sites come to life and offer their players to make deposits, play with bitcoin on the tables and withdraw directly into their bitcoin wallet. This means that there are no taxes or opportunities for state control. Much like a regular casino in Nevada, where you don’t have to register anywhere and all your transactions are anonymous.
How to send bitcoin
To pay for goods and services or send bitcoins to an individual, you need 3 things. Your bitcoin address, your private key and the bitcoin address of the individual. From now on, through your bitcoin wallet, you will place 3 pieces of information, which are: input, balance and output. The entry refers to your address, the balance refers to the amount of bitcoins you will send, and the output refers to the recipient’s address.