Bitcoin is something that was once very difficult to acquire. There was a “gold rush” of sorts, and it seemed that an individual had to invest a lot of time and energy to acquire any measure of value from bitcoin.
Now, on the other hand, bitcoin is available to anyone who wants it. Sure, you’re not going to harvest value from the blockchain on your own, but you can still buy and sell bitcoin to meet your own needs.
We’re going to talk about how to buy and sell bitcoin today, giving you a little bit of insight into the process. Hopefully, the information below will help you get a well-rounded understanding of bitcoin and what’s possible when you use it.
Let’s get started.
Crypto for Beginners
First, let’s start by discussing what bitcoin is.
Bitcoin is a cryptocurrency, which means that it’s a decentralized currency that’s encrypted in a way that makes it incredibly difficult to hack. Bitcoin was the first popular cryptocurrency to reach the world in 2009.
At that time, it wasn’t very significant. Few people knew about it, and accessing a significant amount of value in BTC was difficult. Since the value was relatively low, you’d have to sell thousands of BTC to someone to get anything.
The first recorded transaction of BTC for actual goods occurred when a man traded around 10,000 BTC for two pizzas.
Now, that amount of BTC would equate to around $300,000,000. Where things stand now, one BTC is worth around $30,000. It fluctuates, but that’s where it tends to sit these days.
To understand how that value has changed over 12 years, we have to look at what bitcoin is, how the blockchain operates, and why it even has value.
What Is The Blockchain?
The blockchain is Bitcoin’s crown jewel. It’s the thing that makes it so secure, it’s the reason that people can access value, and it’s the key to why the currency has any scarcity.
All transactions on bitcoin are contained in what are called “blocks.” These blocks contain a specific set of transactions. Blocks also have a particular identification code. Finally, each block contains the identification code of the block that came before it.
All of that information is difficult to uncover, and it’s specific to the block in question. Whenever bitcoin is mined, another block is added to the chain. The new block contains its transactions, its particular fingerprint, and the fingerprint of the block before it.
Further, the chain then holds that new block as well as all of the blocks that have come before. Since the key to each block contains the fingerprint of the block before it, one has to know the fingerprint of every single block in the entire blockchain to access the transactions.
As a result, the chain gets more and more secure as more BTC is mined.
How Is Bitcoin Mined?
Bitcoin gets mined by individuals or companies with powerful computers. To uncover or “mine” bitcoin, an entity has to run a computer program that figures out a series of complex mathematical equations.
In most cases, bitcoin miners run excessive amounts of power to allow their computers to do the job. There are around 21 million BTCs in existence, and roughly half of those have been mined.
The fact that there’s a finite number of BTC means that the currency has scarcity. That contributes to its value in a significant way. Another thing to consider is that only a certain number of BTC can get mined at any given time.
A BTC can only be mined every ten minutes. Every time one BTC is added to the blockchain, the nature of the chain is adjusted. So, computers have to race to the finish line to acquire the BTC that’s next in line.
This keeps the market from getting flooded and establishes a level of consistency. As more people start to mine for bitcoin, it gets harder and harder to compete for that block.
How is Bitcoin Decentralized?
One of the most brilliant parts of bitcoin and most cryptocurrencies is that they’re decentralized. By that, we mean that there’s no single location or owner of the blockchain.
It exists independent of any organization or location. It’s a network of code that exists in the nodes of all of the computers on the server. Each time there’s a change to the blockchain, the nodes have to come to a consensus as to the validity of the chain.
So, for example, let’s say that a hacker tries to go in and make a change to the blockchain. Imagine that they enter into the middle of the chain and attempt to hide some piece of information.
The specific block that they entered would be adjusted, and the fingerprint of that block would change. As a result, the rest of the fingerprints in the blockchain would change as well. This would trigger a warning to all of the computers in the node.
Since the change was made on a specific node of the server, it would exist only in that node and the rest of the computers would need to come to a consensus. Since the altered chain would be an anomaly, the rest of the computers would reject it as an obvious threat.
As there are millions of nodes, it’s effectively impossible to hack or break into the blockchain. Many hands make light work of protecting the information.
Should You Try to Mine Bitcoin?
It might seem like an exciting idea to try and mine bitcoin. At one point, that would have been a reasonable thing to do.
Back in the early 2010s, a person could invest in a nice computer and anticipate a high electric bill, but justify it by getting a very valuable bitcoin or two in the process.
That was because there weren’t nearly as many people harvesting bitcoin at that time? It was possible to make a decent amount of money with the equipment available to you.
Since then, though, millions and millions of dollars have been invested in creating mining rigs. Companies and groups dedicate their lives to mining bitcoin. Plus, there are millions of more individuals doing the very same thing as you.
The competition is high, and the blockchain is more complicated these days. It requires more computer power to access and mine bitcoin. Many people join mining pools to try and mitigate the effort. That said, there are still few ways to make any significant amount of money in comparison to the required investment.
As a result, it’s not very reasonable to invest in bitcoin equipment and start mining these days. Instead, you might be better off engaging with bitcoin as a currency and enjoying the benefits it offers to individuals.
You might even find that purchasing a significant amount of bitcoin serves as an investment for you. The value of the currency is liable to increase, and your value would increase if that happened.
How to Buy and Sell Bitcoin
It’s very easy to purchase bitcoin. The first thing you should do is take a look at the Byte Bitcoin ATM Map. You can see where you are about any bitcoin ATM.
You might be surprised to find that there are bitcoin ATM options around you, even if you live in a relatively small town. Bitcoin is expanding and people are demanding ATMs everywhere.
You’ll need access to those ATMs if you want to take your BTC value out in the form of cash. Note that you can also buy and sell bitcoin online, but you have to make those transactions with other individuals or businesses that use bitcoin.
Online transactions of bitcoin occur just like any other online transaction. The only difference is that both parties have to use bitcoin and there aren’t nearly as many options.
The smart thing to do is know where the closest bitcoin ATM is and take out cash when you need to.
Set Up a Bitcoin Wallet
Before you can take money out from an ATM, you have to set up a bitcoin wallet. Doing this is just about as easy as setting up any other online account.
Go to bitcoin’s website and enter into its “wallet” section. There, you can get all of the information you need to start setting up your bitcoin wallet. Just enter your personal information, connect your bank account, and start working with the interface.
You can purchase bitcoin right away. Further, you can buy any amount of bitcoin. You can purchase $5 of BTC, or you could scale up and buy a whole lot more.
You don’t have to buy an entire BTC. Dropping $30,000 would be out of most people’s ability. Instead, the freedom to get any amount of bitcoin into your wallet opens the accessibility to everyone.
One nice thing about a bitcoin wallet is that it allows you to get insights into the market. You can look at how the BTC is doing to determine whether or not you want to use the currency as an investment.
You can also explore other factors of the market to aid your investment portfolio. That includes access to information and resources on other cryptocurrencies like Ethereum as well.
Using a Bitcoin ATM
When it comes time to use the bitcoin ATM, you’ll find that it’s just as easy as using any other ATM. The only difference is that you’ll need your phone to access the funds.
That is, when you start to check in with the bitcoin ATM, you’ll be asked to verify your identity by receiving a code to your cell phone. It’s a two-point verification that ensures your account is safe.
Once you’ve done that, you can choose to take out your existing BTC in the form of cash. You can also buy bitcoin at the ATMs, which is something you can’t typically do at other ATMs.
To do so, you just specify the amount that you want, and the values will be taken from your bank account and entered into your bitcoin wallet in the form of BTC. There might be a small transaction fee, but that can vary depending on the ATM or the owner of that ATM.
Another thing to note is that you don’t use a card of any kind at these ATMs. Instead, the transaction is facilitated with your cell phone and information on the screen. You might scan a QR code, go to the destination site, and verify your information.
After that point, you can use the ATM just as you would otherwise since the machine will know the details of your account.
Spending Your Bitcoin
There are a lot of in-store options to spend your bitcoin. Stores like Subway and Pizza hut have even started to accept bitcoin in most locations. If you’re planning to spend your bitcoin at a particular store, though, you must check with that location before you go.
Although it’s getting easier for small and medium-sized businesses to accept bitcoin, many still don’t have the technology or accounts needed. You’ll have a lot more access to spend your bitcoin online, however.
Most large websites and even a lot of the smaller ones have bitcoin capabilities. Although those who haven’t used bitcoin might imagine it’s a complicated thing to use, note that it’s just like using any other form of currency online.
You just click the bitcoin option, enter some account information if you’re not already logged in, and approve the transaction. It’s very similar to using PayPal to make purchases online.
The user just has to verify that they are the owner of the account and the money flows through.
Want to Know More About Buying and Selling Bitcoin?
Figuring out how to buy and sell bitcoin is the first step. It’s an important one, too, considering that bitcoin will likely become an ever-prominent currency. There’s a lot more to learn, though.
We’re here to help. Explore our site for more insight into crypto for beginners, buying bitcoin, and much more.
