The prices of bitcoin skyrocketed in late 2017 and first quarter of 2018. Although the prices of the cryptocurrency is downed again still it is the charm for investors to invest. Therefore many people tend to know that how to buy bitcoins. Bitcoins is considered as the currency of future. But the sudden fluctuations in its rate, this currency is very uncertain.
It started from $1000 per bitcoin to almost $14000 per coin within months. That shows the potential of the investment.
In this article, I will tell you how to buy bitcoins with cash, PayPal or even by credit card. First of all, you will know what bitcoin actually is and how its technology works.
What is bitcoin
Firstly, Bitcoin an online cryptocurrency. It does not have any solid or materialized shape. Therefore it is also called as volatile currency. It is create series of calculations that do computer power. Bitcoin is also a decentralized currency, which means it is not governed from any of the body or department. These characteristics make bitcoin more vulnerable to the investors.
Secondly , buy every type of goods like pizza, car or even software online to bitcoin. It is consider a commodity and it is trade also. No central authority controls bitcoin. Due to its peer-to-peer technology bitcoin is much different than regular currency. Bitcoin actually works on blockchain technology.
What is blockchain
The blockchain is the state of the art technology that works behind the every online cryptocurrency. You are consider blockchain to the public ledger. Like a public ledger is used to record the public transactions. Every transaction is stored in the public ledger for everyone to see. Same is the blockchain. The blockchain is an online version of public ledger. It is the primary mechanism that use in the various financial systems from all around the world. In fact, blockchain is the backbone of cryptography.
What is cryptography
The new question is arise from every question. But let assure you guys that you will get handsome knowledge of all the technology working behind the bitcoins before you buy. It will give you a firm grip over the coins and will assist you to take decisions of buying and selling wisely.
Back to cryptography. Cryptography is a digital technique to make transactions secure. It does not matter where the people are living who are making transactions online around the world. Cryptography creates a shell to encrypt the cryptocurrency.
What is rest of the bitcoin
Bitcoin is back in 2009. It is the oldest cryptocurrency. Many cryptocurrencies evolved and merged after the invention of bitcoin. But bitcoin still dominates the online currency. However, There are many other cryptocurrencies working around like Ehtrium, Ripple etc. but no one can compete the bitcoin.
What is the unit of bitcoin
A single bitcoin is a market value of thousands of dollars. The value may vary with the passage of the time but it is being precious day by day. A bitcoin is one unit of this cryptocurrency. But due to high value, small fractions like a penny of the dollar are also used to denote bitcoin. The smallest fraction of bitcoin is called Satoshi. It is 1000th part of the main unit.
How bitcoins are generated
As I stated earlier, blockchain technology works the bitcoin and all other cryptocurrencies. But blockchain is only the way to record the transactions in a sequence. The process that actually works to generate bitcoins is called mining.
What is mining
Mining is a computational process to verify the transactions that is blockchain. It involves the solution of some mathematical problems varying at different levels of difficulty. Mining also ensures that these solutions are done on a regulated basis.
You think that mining creates solutions. Every solution creates a block. The series of blocks is blockchain. These blocks cannot be moved once they are created and added to the network. It is impossible to make an alteration after the adjustment.
How many bitcoins have been made
Maximum six blocked you will made in one hour. As the times passes, it becomes more and more difficult to generate bitcoins. Actually, the creator or creators (whoever knows?) will structured the system to work under limits. Every year the bitcoin generated almost half from that of the generated last year.
A cap of 21 million bitcoin has set already. In other words ,It means that maximum 21 million bitcoins will generated. Therefore,16.7 million coins will generated as of December 2017.
What is the current value of bitcoin
The price of bitcoin varies at daily basis. As these lines are being written, the price of one bitcoin or BTC is $7070 per bitcoin. BTC is the unit of one bitcoin.
Where to but the bitcoins
Here comes the actual answer of the question that most of you people ask. Where to buy the bitcoins?
However,The answer is, you will buy bitcoins directly from the people who get the coins. But you must be aware of the scammer’s guys. There are hundreds of thousands of the people who lie about the coins and making frauds. Instead, you will try to buy coins from online exchanges of bitcoins. There are many exchanges working online and selling the bitcoins at a defined rate. These exchanges include coinbase, bitsamp, kraken, and gatehub etc.
What is a most reliable exchange of bitcoin
Coin base is consider as a biggest US cryptocurrency exchange. If you are a beginner, definitely then you will start from coin base. It is most reliable exchange out and provides relevant software and hardware like wallet etc also.
What is a wallet
In this paragraph Like any other paper currency, bitcoin also needs a wallet to store the coins. This is actually a software. A wallet contains a 256 bits private key. Every user has its unique private key. This key gives the user an access to his coins. A wallet key works for every marketplace or exchange. It allows you make transactions anonymously.
There are different kinds of wallets i.e hardware wallets and software wallets. Hardware wallets are like a flash drive stick and only can be purchased from specific exchanges. The software wallets is like apps which we use to complete our normal bank transactions,
How to get a wallet
After that,the software wallets are very easy to get. As I write it before , these are apps. You can download it from the concerned app store on your device. Many companies are offering different wallets. I will advise you to get a wallet of the exchange from where you want to buy coins. Chose the wallet of coin base. There are some other popular wallets like mycelium, Electrum etc.
Now once you will a thorough knowledge of bitcoins and know how to get a wallet. Here are the actual steps you should take to buy bitcoins. Follow these steps one by one:
Setup your wallet
The easiest way to create your wallet is to chose a third part wallet providing company like coinbase etc. you can go to blockchain.info website. Create an account. Provide your details like email, name etc. and last but not least signup to your account.
Download wallet app
Similarly,the software wallets are available in the apps store. It depends which type of the wallet you will chose. You will have to download the same kind of app. Wallets apps are available on both Apple store of iOS devices and Google play store of Android devices. There are some wallets, specially designed for the desktop computers. You will download the one accordingly.
Create an account on the exchange
Now visit the exchange you will buy bitcoins. Again, you may select different than coin base. There are many exchanges working our there like Poloniex, Kraken, Bitfinax, Bitpanda, Bitstamp, and CEX.io etc. it’s your choice of which exchange you choose to buy bitcoins. Every exchange has its pros and cons. most importantly,You should have to provide your email, name and some other details during the account signup. Some exchanges will require your Bank Account details to charge the substitute amount of bitcoins.
There are some apps who work as both exchange and wallets. Remember it is not necessary to the wallet of same exchange from where you want to buy coins. You will use a different wallet rather than the exchange.
Buy the coins
Now you can buy the coins. Go to the “Buy” section of the exchange. Select how many coins you want to buy. You can buy as many coins as you like. As a result, You can buy infraction. Depending on your budget, you can minimum buy a Satoshi which is 0.0000001 of BTC.
After that if you buy the required bitcoins you will submit your account details from the exchange it will deduct the require amount. You will get a private key in return for your wallet. Import the key to your wallet and here it goes. You are the owner of bitcoins now.
The more you spend the money, the more you will get the coins.In conclusion, My last advice is if you want to buy a huge amount of bitcoins than try to use hardware wallet. It is safer than online software wallets.