The invention of Bitcoin is attributed to Satoshi Nakamoto. It is not clear if this is a single person or a group of people, and in fact there is no information about Nakamoto, but even so the article published under this name, and with the title “Bitcoin: A Peer-to-Peer Electronic Cash System”, was the first step in the revolution in the money market.
The time of publication of the article also played a role in the public resonance of the article, and of Bitcoin. As you remember, in 2008 a global financial crisis occurred, not least due to the greed and irresponsibility of large banks in the USA, and therefore the idea of a decentralized currency – one that can be traded directly between people without the mediation of a bank – fascinated many. The possibility to skip the middleman is also one of the characteristics of the digital age in general, so the success of the concept that Nakamoto came up with is not surprising.
In contrast to the traditional currencies, which are issued by central banks of countries, the Bitcoin (as well as the other digital currencies) is produced by humans, using a computer, based on a technology called Blockchain. In order to produce Bitcoin, a very significant computational power is required, and because of the similarity to the gold mining of the past, Bitcoin production is also called “mining”. The Blockchain technology allows the registration of all transactions in the digital currencies in a decentralized database that is not controlled by a central body – therefore there is no need for banks to buy and sell bitcoins.
Bitcoin production is planned to end by 2040. The total amount will be 21 million coins, and should not exceed this amount – so in the long term the supply of Bitcoin is rigid. At the same time, each bitcoin can be divided into small units – up to 8 digits after the decimal point – so it is possible to reach a huge, almost infinite amount of bitcoin fractions.
In the beginning, Bitcoin was mainly considered a revolutionary idea but not an actual product, and there were even those who treated it as just a joke. Later, the crypto market was perfected, and at a fast pace, and today you can buy and sell bitcoins and other decentralized currencies in dedicated exchanges, through companies that specialize in this specific field and also in transactions directly with other people. The most convenient and safest way is to trade through a company that is its specialty, and of course conducts itself with complete transparency and is careful about reliability like CRYPTOC.
Digital currencies are stored in a digital wallet. There are several types of wallets for storing bitcoins and other decentralized currencies, with one option being appropriate hardware, and a second, more common option, being software or an app. Access to the application is via a 12- or 24-digit code – and it is very important to back up the code.
Please note: unlike other places where a code or access method can be recovered, based on means of identification such as an ID card, credit information or a cell phone number, the code for the digital wallet cannot be recovered in any way whatsoever! For example, at the beginning of 2021, it was reported about a programmer from San Francisco named Stephen Thomas who in 2011 was able to receive in return for work he performed about 7,000 bitcoins (which were worth $35,000 at the time). In 2021, the value of his digital wallet was already about $240,000,000 (in words: two hundred and forty million dollars) – but he lost the code to it…
The Bitcoin rate is characterized by quite high volatility. Sometimes it seems that this is a chaotic market where the conduct is arbitrary, but in the end the rates of digital currencies are also determined by demand and supply. Another parameter, which is already a unique characteristic, is the maximum number of coins and the production cost.
The main advantages are the ease of carrying out the transactions, the immediacy and the immunity to geopolitical crises that could damage the traditional currencies. The main use of cryptocurrencies as of today is as a medium-long term investment, but gradually they are also becoming an accepted means of payment. In this context, it is worth noting that more and more entities, including giant companies such as Visa and PayPal, accept Bitcoin.
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