What is a Bitcoin?

The cyber-currency that is more popular than ever

 

Bitcoins

Physical Bitcoins. Photo by Anton Ana, used under a Creative Commons license.

Bitcoins are cyber-currency created by users and completely open source, as well as being independent of any central authority.

Controversy surrounding web privacy and governmental control has taken center stage as of late with the recent NSA scandal and U.S. government shutdown; these are two of the many factors that lead to the rise in popularity surrounding Bitcoins.

According to Vice.com, during the U.S. government shutdown the value of Bitcoins has reached a five-month high at $156 per coin.

Upon its inception in 2008, Bitcoin made huge waves in the online privacy and economic sector of the internet.

Being a “cyber-currency” gives Bitcoin its biggest advantage against normal state or institution controlled currency: Bitcoin is generally referred to as peer-to-peer or user maintained.  This means no fees and no real regulation.

But getting Bitcoins can take a bit of effort.  There are two ways of obtaining Bitcoins, buying them outright or “mining” them.

Buying Bitcoins is pretty straight forward. Establish an account on an “online wallet” service and buy Bitcoins from a Bitcoin seller.  “Online wallet” services can be found at Bitcoin.org’s “choose your wallet” section.

Since Bitcoin prices fluctuate, the stock market-like practice of buying low and selling high can make an avid Bitcoin buyer a lot of money.

Another way to gain Bitcoins is to “mine” them.  “Mining” Bitcoins is the process of running software that evaluates and solves massive equations ending with a payout in Bitcoin for the solved equation.  Mining often yields a minute amount of Bitcoins, but if the processing power is there, this is a huge money maker.

Currently, uses for Bitcoins are limited.  For the moment the best option is to sell Bitcoins through the online wallet service and make some money when prices fluctuate.  But with the recent rise in popularity of Bitcoin, online retailers have taken note and many are now accepting Bitcoins as payment for goods and services.

The world of Bitcoin is growing more and more each day, with more retailers accepting it and coin prices going up Bitcoins are a step into the future of economics.

For more information on Bitcoins visit the Bitcoin Wiki.

   Contact Nicholas Wedyke at nwedyke@gmail.com.

Nicholas Wedyke

Managing Editor

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