(cnn) – After years of skepticism, bitcoin is finally gaining credibility with a wide audience.
tesso updated last month that it will soon accept bitcoin as payment for its vehicle purchases, revealing that it bought $1.5 billion worth of bitcoin as part of its holdings. Meanwhile, Uber and MasterCard have also said they plan to start accepting Bitcoin. bny mellon and blackrock are investigating the cryptocurrency and jay z and twitter chief executive jack dorsey announced the creation of a bitcoin development fund.
Reading: De donde es la moneda bitcoin
It is speculated that as more financial institutions invest in bitcoin, more companies will join. some investors believe it could be a good hedge against inflation and a weak dollar. The Federal Reserve booked interest rates in March 2020, severely weakening the US dollar and sending the price of bitcoin skyrocketing.
so if you’ve been ignoring bitcoin thinking it might be a financial fad, now is the time to start paying attention. this is what you should know.
what is bitcoin?
bitcoin is a currency that was created in 2009 by an unknown person using the alias satoshi nakamoto. transactions are carried out without intermediaries. bitcoin cannot be physically used, it is a digital currency. and it is decentralized, meaning it is not controlled by any bank or government.
Currently it can be used on many sites from overstock.com to paypal. and the list is growing rapidly.
many people also see bitcoin as a good investment. And that has been true this week, considering that it exceeded $ 60,000. In January, the cryptocurrency hit records of over $40,000.
how does it work and how to buy the cryptocurrency?
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Bitcoins can be used to buy merchandise anonymously. In addition, international payments are easy and cheap due to the fact that they are not tied to any country or subject to regulation. small businesses may like it because there are no credit card fees.
There are three ways to buy bitcoin:
buy on (digital) bitcoin exchange sites
bitcoin is 100% digital. markets called “bitcoin exchanges” allow you to buy or sell bitcoins using different traditional currencies. coinbase is one of the main changes, along with coinmama, cex.io and gemini.
transfers
People can send bitcoins to each other using mobile apps or their computers. it’s similar to sending cash digitally.
mining
People compete to “mine” bitcoins using computers to solve complex math puzzles. this is how bitcoins are created.
bitcoin wallet: how does it work?
See also: Wallets — Bitcoin
Bitcoins are stored in a “digital wallet”, which exists in the cloud or on the user’s computer. the wallet is a kind of virtual bank account that allows users to send or receive bitcoins, pay for goods or save money. Unlike bank accounts, bitcoin wallets are not insured by the federal deposit insurance corporation.
the anonymity of bitcoin
Although every bitcoin transaction is recorded in a public record, the names of the buyers and sellers are never revealed, only their wallet ids. While that keeps bitcoin users’ transactions private, it also allows them to buy or sell anything without tracking them easily. that is why it has become the currency of choice for people who buy drugs or other illicit activities online.
what does elon musk have to do with this?
elon musk, chief executive of tesla and spacex, has a history of tweeting his support for certain assets and sending stocks skyrocketing. and the richest man in the world is a great promoter of bitcoin.
“I think (bitcoin) is about to get broad acceptance by people in mainstream finance,” Musk said in a recent interview on the social app Clubhouse.
shortly after he formalized tesla’s link to cryptocurrency, announcements from other companies came pouring in.
is bitcoin safe?
Cryptocurrency is very volatile and therefore very risky. For example, in January the value of bitcoin rose to $42,000, fell to $30,000, and rose back to $40,000, all in one week.
and there are some dangers inherent in a digital currency: a hacked server, a deleted file, or a lost password could mean funds are lost forever.
pablo r. la monica, chris isidore, tal yellin and hanna ziady contributed to this report.
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