(Video: Understand Bitcoin and How to Make Money with It)
If you have been following along with the trends on the internet and coverage from the media, you probably have at least heard about this new supposedly revolutionary thing that is making all the techies and early adopters giddy like schoolboys or schoolgirls, called “bitcoin.”
What Is Bitcoin?
The first time you heard the word “bitcoin,” you undoubtedly most likely asked, “Huh, what the heck is this bitcoin thingy?”
- In a nutshell, bitcoin is a digital form of currency that many people are starting to adopt for their economical transactions of goods and services, and many businesses are starting to even take.
First you have to be aware that this is 100% virtual, so it’s NOT tangible. Like numbers on your bank account from the money you deposit, you can exchange your money for this digital currency and sell them in the virtual world or convert them back into real dollars and cents.
Even thought it’s completely digital, you can get it in physical form. There are some private companies that will trade your “digital bitcoin” or “dollar” for their collectible physical coins, which have custom-embedded notes in them to represent the face value of that exchange, so you can exchange them back with that private company or with others who are willing to accept these specific coins.
Keep in mind that this is sort of a grey area. There has been concerns of fraud as they’re not government-insured, so basically you’re trusting these private companies to honor their IOU through their physical coins acting as currency value.
If you’re not sure how this works, or are still confused, consider the following notes on what it is, how to make money from them, and how to get them.
The Simplest Explanation
The simplest way to see this is digital coinage. You can share them peer to peer. They are outside of the banking world. They are generated by software solutions that are known as “miners,” and this process of obtaining bitcoin is “bitcoin mining.”
- Imagine the real world mining where someone digs up gold. That’s occurring in the digital world through software that digitally mines Bitcoin. It’s stored in a virtual space known simply as a “bitcoin wallet.”
Software used to mine this digital currency is free, and can be used and optimized by anyone. The code is open source, meaning that there is no one that will charge you for this, although there are some modifications to this that have been taken over and sold throughout the internet.
The initial code for it, however, is free, and open to modify at will.
How To Make Money From Bitcoin
- First and foremost, you’re going to need a Bitcoin wallet to store anything you mine.
- After you have that, you’re going to need hardware. You cannot do this without hardware, specifically a computer that is able to run the mining software at a long period of time. This digital currency isn’t like going to collect sand from the beach, or water from the ocean. Time is involved, and it’s not a matter of just showing up to collect the currency.
- You’re going to need a CPU, GPU, FPGA, and ASIC. These can be purchased online as a set, or you can purchase a computer that is already set up to mine for the currency.
Two Ways Of Bitcoin Mining
There are two major ways that you can work within the confines of mining.
- DIY Method – The first option is to go Do-It-Yourself. You will need to set up your own computer system, and then have the software run and mine until you have items in your wallet. This will take time to work through, and can be quite difficult to manage. If you can’t do this, get a technician to help you.
- Pooling – Another option is to go into a pool with others, and then split the currency amidst the members. You can find friends, or look out for pools and different solutions that abound in the marketplace right now. Either way, you’ll split any currency that you mine with others, and that’s it.
Basically, making money from bitcoin works like other monetary trading, i.e., forex, gold, and even silver – whatever considered to have value.
You invest in bitcoins hoping their worth will go up, then you exchange them for the difference in profit.
Simplifying The Complex
At the end of the day, this whole defining line, and run down of how to make money with mining and saving digital currency has been simplified. There’s a more lot that goes into this.
Nevertheless, with this basic information, you can look into opportunities to set up a mining station, and even start making money with digital currencies online.
Not much to say about bitcoin other than it’s perceived valuable commondity that gets stronger as soon as more people are willing to adopt it otherwise it’s a vapor good.
So what is bitcoin? Seems to me like some digital numbers if the majority of people consider as valuable, the more acceptable and vlauble it becomes.