Everyone seems to have questions regarding the Bitcoin phenomenon.
*We begin by giving all the credit to this post to it’s originator and the original article. I still believe that the information is vital to Eliminate the Confusion that surrounds this topic. My thanks goes out to Scott Maxwell for his time and expertise. The original article was written in June of 2014. Many more issues have been resolved since that time.
This is Part 2 of a 4 part series. If you missed out on part 1 you can find it here.
What’s the big deal?
Crypto-currencies have succeeded in answering two of the fundamental problems with moving money online:
- How do we stop someone from spending the same money twice?
- How do we avoid middle men?
As it gets established, we’ll all benefit from a faster, more secure way to shop online.
There are also social benefits. The micropayments, microloans and very low transaction fees. These will help poorer countries access online services much easier.
How Can I prove I Own a Bitcoin?
The public ledger proves ownership.
But how do we know that an entry on the ledger is legitimate?
Where the islanders knew everyone by sight bitcoin relies on digital signatures.
These use the same cryptography that protects websites. It’s designed to prove you are who you say you are, and relies on the use of two passwords, one made public, one kept hidden.
An entry on the ledger is legitimate only if it is digitally signed by the owner.
How Do I Spend Bitcoins?
You spend bitcoins by ‘signing’ a transaction and putting it in the ledger. You use a piece of software called a wallet to do this.
It takes about 30 minutes for the transaction to go through.
Can I spend less than a whole bitcoin?
Yes, you can combine and split bitcoins as you see fit. This works just like splitting dollars and other currencies into coins, and back again.
You can do this down to smallest unit, called a satoshi, which is 1/100,000,000 of a bitcoin.
Are Bitcoins Secure?
Yes, At the individual level, it’s as secure as any bank website. Keep your password safe and your crypto-currency is safe.
Is Bitcoin stable as a currency?
No, it will fluctuate just like other currencies, tremendous growth has occurred in the last year alone and all indications show that this increase will continue.
Can Bitcoin convert to dollars and other currencies?
Absolutely, You do this through your Crypto Wallet. Some companies will even attach a credit card for easier access and we are beginning to see Bitcoin ATM’s pop up around the world.
Let this be the beginning of your Bitcoin search.
This post will at least scratch the surface for you and maybe even get you thinking a little bit. Feel free to use google or youtube as you continue your search. Just as a word of caution, people are literally making millions with Bitcoin (my friend and mentor is one of them). As you do your research you will find a lot of negativity out there. You certainly want to minimize your risk as much as possible, but please don’t let the Dream Stealers and the Negative Nellies keep you from finding an active group of like-minded people riding this wave into financial history.
Stay tuned and be sure to FOLLOW over in the lower right corner.