Bitcoins are the first kind of cryptocurrency that is a form of digital money. The word cryptocurrency is made up of two words, crypto and currency. While currency means the general meaning of cash, crypto comes from the more scientific term cryptography which is a form a security process involving encryption for safe storage and transfer of data. Cryptocurrencies are a form of computer-generated code that uses hashing techniques to make it undecipherable. They usually involve massive computation to make them more secure and thereby effectively preventunauthorized creation and usage of cryptocoins.
Bitcoins and blockchains
Bitcoins are created by using cryptography on specific codes and further using blockchains to store information regarding them. These blockchains are a form of public data files that can be used to track the bitcoins. The blockchains are unique for every individual. Though they do not store public information such as names of the bitcoin owner they save every transaction related to bitcoin. In other words, once you create or earn bitcoin, there is a blockchain associated with it. This blockchain stores all the data related to your bitcoin publicly and deters people from misusing your hard-earned bitcoins from misuse by tracking them.
While bitcoins can easily be used in transactions, it’s practically difficult for one single individual to produce them. This is because creating bitcoins is quite an expensive process computationally. The electricity and utility bills which are increased during the process of creation of bitcoins reduces the overall value of the bitcoin. However, it more accessible to earn bitcoins rather than create new bitcoins.
You can earn bitcoins through various methods. Each method has its pros and cons. The most legit way to earn bitcoins is through working for companies which pay in bitcoins. However, care must be taken as bitcoin value often tends to fluctuate. Another popular method to earn bitcoins is through bitcoin mining. However, this method requires good knowledgeof bitcoins and has been reducing in popularity because of improved hashing techniques. The bitcoins thus earned can be added to bitcoin wallets and used.