Cryptocurrency, Bitcoin, Blockchain, mining – these words are doing rounds on the internet. The rise in Bitcoin value and pricing can attract any investor. Over the years, a number of people have gained interest in virtual currency, and it becomes important to answer a few questions pertaining to this field to solve their doubts.
1. Can we use Bitcoin and Blockchain interchangeably?
This is the most common apprehension that you will come across when reading about Bitcoin. Bitcoin is the application of Blockchain. Bitcoin is a consensus network, while Blockchain is the platform that allows the execution of this network, enabling the transaction to be executed. Blockchain can be used by any financial industry. For example, you can find insurance and banking industries using blockchain technology for their online transactions. But, crypto blockchain is quite different where transactions with digital assets are stored in a public ledger.
2. What is proof of work?
If you want to be a part of the Bitcoin family, you must be well-versed with what this currency is all about and how it functions. Well, the underlying consensus that executed Bitcoin transactions is Proof-of-work. As a part of this, the miners have to solve complex mathematical problems, and the one who solves the problem can get bitcoin at free of cost as a reward. While most of us may think that solving this problem is very easy, but it is a complex problem that needs to be solved within 10 minutes. One has to have access to top-notch equipment and supporting hardware to work or mine cryptocurrencies. Moreover, this hardware and equipment are so costly that it eventually raises the cost of the entire work. So doing it individually can be a costly affair and you need to invest a lot to join the mining community.
3. How long does it take for Bitcoin mining?
One of the common things that you would have heard about Bitcoin is that the market is highly volatile. Yes, Bitcoin continues to seesaw, and the highs and lows abruptly disrupt the pricing of Bitcoin. Unlike earlier days, Bitcoin mining is now contextualized. Validation of transaction is paramount. The first person to validate a block is rewarded. As compared to earlier times, the reward nowadays is 6.25 BTC. Mining speed is impacted by many factors, such as
1. computational power
4. Hashing difficult
Taking all these factors into account, mining 1 bitcoin can take up to10 minutes. But this is an ideal situation, and if there is any disruption in any of the situations, you will find that the Bitcoin mining time is going to get impacted. Miners around the world are working on the same blockchain network and you will get a reward if you solve the problem and validate a transaction within a few minutes.
4. How would you use Bitcoin?
Compared to the time when Bitcoin was introduced in the market, today, we find a multitude of use cases of Bitcoin. When it was first introduced in the market, people started to question its longevity and applicability. Surpassing all the apprehensions, Bitcoin is now gaining a mainstream position in the financial market, and we are witnessing a rise in its use cases. You can
1. Use it for making payment of goods and services
2. Purchasing new Bitcoins
3. Exchanging Bitcoin with others
4. Earning through mining
Many countries and governments are trying to explore the different ways of using Bitcoin and making it a part of the mainstream economy. However, there are certain hindrances in its complete acceptance. Apart from that, there are some large retain stores available that accepts bitcoin as a valid payment mode.
5. From where I can buy Bitcoin or altcoins?
Trading in Bitcoin has increased, and so is the number of platforms offering this service. If you, too, are willing to make a start in the Bitcoin investment journey, it is time to choose the best Bitcoin investment platform like Bitcoin Era. A credible platform will be easy to use and will give you access to explore the different cryptocurrencies in the market.
We hope that this set of questions will have cleared the air around Bitcoin and allied concepts. Never make a decision in a hurry; rather, explore the different options and make a final call.