What is Bitcoin ?

Many people feel very confusing when Bitcoin Bitcoin is something that is actually very simple and easy to understand, not as you might think. This learning series aims to help everyone to understand the basics about Bitcoin, and as time goes by, we will provide learning opportunities for those who want to know more.

Bitcoin is usually explained by comparing the Bitcoin itself with something we've know before, but this will make your getting confused. Bitcoin is a new technology that has never been before, so we see a better way is to look at things as a combination of Bitcoin is different that we know:

First, because of the Bitcoin makes it easy to move money, Bitcoin is a payment system, similar to the method via bank transfer or credit card, but the Bitcoin is slightly better.

Second, Bitcoin resembles gold-this is why many people call Bitcoin as ' digital ' or ' gold Gold 2.0 '. Imagine Bitcoin as gold serve as money, but very easy to Bitcoin transferred (transferable).

Third, Bitcoin resembles the internet because none of the persons or entities who control it, so anyone can use it according to their wishes. This is a very unique characteristics.

These three characteristics are supporting each other, and fused in such a way. In-depth details we will explain in the next section. For now, imagine what happens if you put a big pot and throw a credit card, a piece of gold, and a bit of ' internet ' into it – all of it – to pull out something new – Bitcoin!

Bitcoin is a new way in the transfer and save money.

Where the origin of the Bitcoin?

Bitcoin ' created ' by someone or a group of people with the name ' Satoshi Nakamoto '. Is there anyone who actually know who she is? Although there are many articles and investigations to find out the truth about who she (or they), there is no evidence that is strong enough to date. Does it matter? Not at all. Satoshi design the entire system of the Bitcoin with open attitude ' manner '-this means that the code is available to be viewed and checked by everyone, so there are no hidden secrets, and no influence from its creator. As time passes, many people started working on these codes so very different from the initial draft created Satoshi.

It is important to remember that there is a misunderstanding about the mentioned that Satoshi Satoshi creates Bitcoin alone. Like other great breakthroughs in science, the creation of Satoshi built by the hands of many people. In a few decades later, many leading experts, engineers, and mathematicians are involved in research on cryptography, systems, and more. Satoshi manages to encapsulate all this work into one coherent and clear plans and then perform the implementation of the plan. If you read the Whitepaper, Satoshi you will read references from all over the discovery that prompted his creation.

Bitcoin created by Satoshi, standing on the shoulders of giants.

Bitcoin as payment systems !

How do we transfer money to thousands of years ago, when we lived in small villages, know and trust each other? We easily do barter, as we did with the cash at this time. But when money moved online, this will be a little tricky. Bank and credit card services to resolve this issue with ' ledger ' system (' cash ' system)--a saving account and history shows who owns what.

When John did the online money transfer from one person to another, the bank was the one who did the transfer of John to others. John can't do it myself because there is a risk he is cheating-he can copy (copy), and paste (latching) digital money (because all of it is just numbers on a computer) and submitting it to two different people. So, we trust the bank to send money and make sure only one person receiving the money. The Bank can cheat, but we believe they are not committing fraud.

If the transfer occurred on the same bank, it is easy to do. But if the bank is different, it will be a little complicated because they may have different cash system and need to be matched. Therefore, they charge you small, and this transfer usually takes up less time. When the bank and the financial system is derived from the different countries, things became more complicated: language, system, currency, and more people should be doing the coordination and so on, so the transfer cost and time increase. That is why the current financial system is extremely complex. The system is a big kesemrawutan of various systems of cash in the world.

Bitcoin changed all that. With what? Bitcoin is a system of cash that synchronize across the internet, so everyone can access the same treasury account in real time regardless of who and where he is. The result? Money can be transferred from one party to the other party without delay and the cost is very high. Like when the money is used once, before the world is so big and complicated.

Bitcoin payments system used for what? The answer: whatever you use with the usual: send money to friends and family – both local and overseas, to buy goods online, receive a salary, and so on.

Bitcoin is way faster, cheaper, and easier to transfer money.

Bitcoin as digital gold

Centuries, gold has been viewed as objects of high value by many community groups in the world. It is important to note that the gold itself has no value – gold is simply a chunk of stone that sparkles. Gold value derives from the fact (which is a little confusing) that everybody agrees that the gold has a certain value, and hence gold considered valuable. The reason why people choose gold than other objects it is important to understand-because gold has certain characteristics that make it a ' mass storage device ' (store of value) that is better than other objects:

First, the gold are rare. That is, the amount of gold limited (there are only a few of the gold in the world-if too much then everyone can have it and the gold will not have any value). Gold also are soft (gold can be melted down and molded into a variety of units as small as coins, and more importantly when you change its shape into smaller units, it will not lose its value-not like diamonds). Gold also stabli and not degraded, easily known and hard to emulate (made knockoffs fake ones).

Bitcoin has all the same characteristics as gold. The number of Bitcoin is limited (there's only a certain amount to be produced), Bitcoin can be broken down into smaller units without losing the unit value (1 = 100 million Bitcoin Satoshi-smallest unit of Bitcoin, same as cents in Dollar or pennies in Pounds, so that we can buy less than a Bitcoin), technology Bitcoin also stable and will not degraded, nor perhaps can be made false Bitcoin. In addition, unlike gold, you can move your Bitcoin wherever in the world in a matter of minutes, regardless of the amount of the Bitcoin. That's why people call Bitcoin as digital gold, digital gold, however.

Bitcoin has value as well as a payment system. More and more people use the Bitcoin for payment, the more valuable this payment system. Buy Bitcoin similar to buy shares of Visa, and then use the stock to buy soda at 7-11. Because you pay with your Visa stock, then use the more, Visa (payment system) Visa is increasingly widespread and increasingly valuable, so the value of the shares of Visa will become increasingly valuable (including your own Visa stock value!).

The value of Bitcoin comes from the gold-like characteristics, and also functions as a payment system like Visa.

Bitcoin resembles gold, but better.

Bitcoin as internet !

The Internet is the greatest advances in human history, which has changed the way of life and the workings of the world community. Many people don't realize that the internet we know today, probably will never exist because a number of ' rival ' internet ' that was built at that time. There are certain companies that want to link all the computers in the world to share information, but with their own system, so people have to pay to access the ' information superhighway ' of their own.

The Internet is different, and in a modern design, is an open system that allows everyone to use it as you wish, and the system is not owned by anyone, so there are no gatekeepers. This redirect on something called ' innovation without permission '-everyone can try new things without the need to request access from gatekeepertertentu.

This then brings an explosion of innovation and the adoption of ' open ' internet, and becomes something very broad and large now. This design also indicate that many parts of the internet are ' interoperable '-meaning that I use the internet can connect with the internet that other people use in other countries. It is similar to the use of the global languages used in the world.

The people of Indonesia and the people of India will be hard to communicate, but if they speak in the language of the United Kingdom, then all will be easier. The Internet allows everyone to speak in ' one global language '.

In other words, Bitcoin resembles the internet. To a person, the internet is not owned by anyone, so anyone can use it as you wish-there are no gatekeepers. It is also called a ' decentralized '. Bitcoin supporting innovation ' without permission ' which allows many people to build companies and applications on the internet so that the product is growing rapidly.

The latter, Bitcoin are interoperable – that is, such as email and the internet, and my Bitcoin Bitcoin You all work in one same system, Bitcoin is a global transaction is cash, and if seen from a certain point of view, Bitcoin is the first global currency in the world.

Bitcoin resembles his internet money.

How do I get my Bitcoin?

trusted service provider or Exchange, such as the Luno. This is similar to the way like when you buy a stock or foreign currency in banks online. This is the easiest way to get your Bitcoin because you sure will find someone who will trade off Bitcoin them to you on the platform.

You can also have a Bitcoin with doing the mining (mining), but this way is very hard to do normal people. Most mining done by larger companies with sophisticated tools and very expensive, so it is difficult for people or computers to compete with the company. So, if you do not have the expertise and the money to spend is very much, you better buy or find a Bitcoin.

You can get, buy, or mine the Bitcoin.

How does Bitcoin price determined?

Many people are curious about how the price of the Bitcoin is determined. First of all, know that the workings of the Bitcoin price movements are the same as currency or other objects. Let's take the example of how the price of a specified object-we can use orange as a parable. How much is the price of oranges?

The answer is: it depends. The first Orange pricing points is with two things: how much is desired by people who sell them, and how much is desired by people who buy it. If John wants to sell oranges at a price of Rp 3,000,-and Sarah just want to pay Rp 2,000, then the deal doesn't happen. But if they agree with a certain price, for example, Rp 2,500,-then the transaction occurred. In the summer, then more and more people want to buy Orange citrus, so the price goes up. Or if there is a glut of inventory so orange is reduced, but many people want to buy Orange, then prices will also rise.

Bitcoin and other currencies is a bit different from the Orange because they are ' homogeneous ' — one dollar is identical to the dollar, such as identical with other Bitcoin Bitcoin. Orange, on the other hand, can differ depending on large and quality. In other words, more easily determine price Bitcoin or currencies because of the identical.

Many people do not realize that other currencies also works exactly the same as Bitcoin-if you're holding a coin or paper money in your local currency in your hand today, at the same time there are millions of people who do the buying and selling of the eye your local money, so even if you feel your currency rates stable, in fact these prices change constantly. If you want to exchange your money into local currency to another, e.g. to USD, today you might pay with 10 pieces of your local currency, but the next day can only be 11 or 9. Bitcoin work exactly like it-you can imagine it like other types of currency than what you have now.

Bitcoin work similar to a foreign currency.

What is Bitcoin used by criminals?

A lot of public misunderstanding about the large number of uses of the Bitcoin criminal, but the thoughts are thoughts. This thinking caused by the large number of people who thought that Bitcoin are anonymous, when in fact the very opposite of the Bitcoin it-all transactions Bitcoin transparent and everyone in the world can see the Bitcoin transactions are in progress.

People may not be able to connect the identity of certain individuals to the transaction Bitcoin directly (this is why sometime Bitcoin also called pseudo anonymous), but if they find it, then they can see all transactions you have been doing on the network Bitcoin. This is why the Bitcoin is the wrong way if you use it for things that are not true.

Although Bitcoin is probably the safest and not the most ' bad ' in using the money, that does not mean there are no criminals who use them. Just as the money is normal, there are ' bad people ' who use the Bitcoin. However there are two important things to note-first, because the data is more prevalent in the industry, the number of cases clearly evil, that is very, very small.

If ecosystem Bitcoin is represented as one of the great mountain, then measure the nasty parts are just a few bongkah the rocks. Second, in each of the financial system, this is one of the risks that will not be eliminated and only can be reduced, and the Bitcoin has the best tools in the world for that matter.

Bitcoin moving parallel with the internet in the context of all the ' bad things ' embedded people against Bitcoin. Whether the internet is entirely good? Of course not. The terrorists, members of the auxiliary persons of money, illegal drugs smugglers are using Facebook, Twitter, and Whatsapp to communicate and coordinate with each passing day. Some people may worry that at least 5-30% online traffic relating to pornography. We haven't even talked about the dark web, where all the bad things are.

But in spite of all these issues, what is the community doing concrete efforts to ban the internet? It is not. Not because of the repeal and prohibit Bitcoin is difficult, however, because the internet offers more positive things than negative things. For the same reason, we must be more careful against our mindsets toward Bitcoin, because a lot of evidence has shown that Bitcoin brings a lot of positive impact, if not more, from the internet.

The Internet and the devices are simply Bitcoin can be used by ' Wicked ' and ' good people '. Fortunately, the world is filled with more people who are in the category of ' good people '.

Bitcoin is actually much safer than what people think.

What is Bitcoin mining (Bitcoin mining)?

Bitcoin mining (Bitcoin Mining) is one way to get a Bitcoin. As mentioned earlier, we can see the Bitcoin as a great global cash system that stores transaction history (or ' movement of money ') from one person to another. When the transaction was processed in the Bitcoin Bitcoin network--meaning that Bitcoin is being transferred from one person to another--someone needs to ensure that all transactions have been properly recorded and cash systems have synchronized worldwide.

In that case, this process is not a Bitcoin is done by an individual or a company, but by thousands of computers around the world that are connected to the internet.

This computer is known as miners or miners ' '. Simply put, they are ' computer that processes the transaction '.

To do this processing in a safe way, computers need to perform complex calculations that take very large computing effort, so it takes a great energy as well as well as the special tools. Someone--the owners of the computers--need to pay for tools and such power, so they should get compensation from all the effort and money they spend to support these networks. They get compensated through the newly mined Bitcoin.

Bitcoin recently mined acts as awards and incentives for those who contribute to the system which supports the process of the transaction.
Another way to understand this is to imagine what happens if large banks build global transaction processing system in the world: they will spend billions of dollars then put on a small transaction fee on its users to cover the cost of construction of the system.

Bitcoin with mining, the cost to the global system is divided into thousands of computers, and they shut down their costs with the new Bitcoin mined. Long story short, this is the democratization of financial infrastructure.

Mining Bitcoin = transaction processing

What is a private key (private keys) Bitcoin?

Transfer or move the Bitcoin is indeed very easy, but in the rear screen, movement and storage of Bitcoin is actually done with something called the ' private key '. The easiest way to fully understand this, is to imagine a traditional post box system:

Imagine if Maria wanted to send a letter to Peter. First of all, he needs to know the address or number of the post Peter. Vice versa, if Maria wanted to send the Bitcoin to Peter, he must know the address of the Bitcoin Peter, that is the number that specifically indicates that the mailbox belongs to Peter.

This number is called with the address of the wallet (wallet address), or the public key (public key). This number is very long and complicated because of the many mail boxes Bitcoin on the world, but fortunately you don't need to stop, you can see it on the internet.
So now Mary sends Bitcoin to postbox Peter.

Let's suppose the number mail boxes Peter is 2034. Maria can look into this and see postbox Bitcoin therein, even all the people passing by can see p.o. box 2034 containing a Bitcoin. The interesting part about this is Bitcoin-where everyone can see all transactions without knowing the identity of the owner. One can see there a Bitcoin in 2034, yet no one, except Mary and Peter, knowing that the mailbox belongs to Peter.

Now let's look at how Peter taking the Bitcoin-he can see him there, so he did not need to do anything. But if he wants to move it, he needs to make that box to send it to other people. To open this post box it requires a key-and this is the unique key belongs to him, also called the private key. Only Peter can use this private key to open his mailbox.

When he opened it, he can move the Bitcoin and put it into the mail boxes of other people. Suppose he bought the game online at Microsoft, he may enter into the box belonging to the Bitcoin Microsoft and if Microsoft viewed Bitcoin they receive, they will send you the online gaming to Peter.

If Maria sends Bitcoin to the wrong post box, he can't take it back. This is the same as cash-if you have been paying out to someone, you can't take it back easily. No one can move the Bitcoin, except Peter, who had a key to the post it. If Peter lost the key? Then there will not be anyone who can access the post it, forever! Peter should make sure that no one is stealing the key, because if the people could open the box belonging to Peter and steal Bitcoinnya.

So it is important to keep it as safe as possible keys, or entrust the keys to the person who can do it.

The private key gives access to the system of the Bitcoin Bitcoin.

How do I save a Bitcoin safe?

Save Your Bitcoin safely is very important. Unlike other types of money controlled by the bank, Bitcoin gives you many options for storing and controlling your money.

Remember about the private key you need to move Your Bitcoin? The key is the key storage of the Bitcoin. The person who has the key to it is the one which controls the Bitcoin it. This key can be a key in the format of digital or physical like written on a piece of paper.

How do I save this key? You can keep it in Your Pants pockets, but it certainly is not secure. You can put it into your home safe-far safer. But someone could just go into your House and stole it. If you want to use the Bitcoin you every day, you need a digital version on your mobile phone so that you can access it more easily. The only problem is if you lose your mobile phone, then you lose your keys, so there will be no way to get back Your Bitcoin.

That's why companies like Luno established-not only to make it easy for You to buy, sell, and use the Bitcoin, however to guard it safely. We do this by storing Your private key in an iron safe banks with access such as fingerprints and retinal scans. Not just a safe iron, but various safe iron on many continents. And we built it with a system that if one wanted to access it, you need the keys from a variety of safe iron and combine them to be able to take the Bitcoin--just like in the old movies, when a nuclear submarine need three to five ' launch ' code of some general before launching nuclear weapons. It is also referred to as ' ' multisig (multiple signatures required).

The way this is a safe way to store your Bitcoin, but you need to trust the people that keep this key. There are many reputable companies like Luno you can count on, but many also don't store Your Bitcoin well, or pretend to save and then abusing Your Bitcoin. Unlike conventional money, you have many options in save Bitcoin-you can keep it for yourself, in physical or digital format, or you can trust other people to guard it for you (or a combination of some of these options).
How Bitcoin is kept is one of the biggest ironies Bitcoin-biggest global digital currency in the world that is designed to be used online, most of the stored ' offline ' in safe banks and regardless of the internet. Who would have thought!

Bitcoin is stored by way of storing Your private key securely.

What is the risk of Bitcoin?

Bitcoin is an interesting technology and a new form of money, but this does not mean the Bitcoin regardless of risk. Keep in mind that there are some rules that are the same in Bitcoin as traditional money. For example, do not store your cash under my pillow because it is easily stolen, or do not entrust your money to strangers.

Bitcoin also has other unique risks: for one man, Bitcoin is a new technology, and although it looks very solid and secure, there is always the possibility of failure. That's also why you should never enter ' all your eggs in one basket ' and don't ever buy Your treasures with all the Bitcoin. Bitcoin is more volatile (value of Bitcoin can go up and down in a short time or place) compared to other currencies, and though now the value of Bitcoin more stable, Bitcoin will surely experience a lot of volatile moments in the future come.

Remember that the transaction is Bitcoin similar cash where the transaction cannot be cancelled-so if you're submitting a Bitcoin to the wrong person, or Your Bitcoin wallet compromised and someone stole Your Bitcoin, very difficult and even impossible to take it back. Bitcoin is also not protected by any entity, so that if you lose Your Bitcoin, then your service provider or network of Bitcoin ' ' cannot replace your loss. That's why you should use a product and a trusted service provider to help you, just like when you choose bank to keep your money safely.

Lastly, the value of Bitcoin is determined by a number of people or businesses that accept Bitcoin. If the Bitcoin develops, this will be very good for Bitcoin, however if the less people using Bitcoin, then this will give negative impact on pricing and the use of the Bitcoin itself.

In conclusion, Bitcoin is a very interesting potential in changing the world, but make sure you understand the risks involved along with it.