This is often the very first thing that people wonder when they first learn about cryptocurrency and want to get their feet wet. First, we’ll take a look at what cryptocurrency is as well as the technology that makes it possible. After that we’ll look at the three most common methods for acquiring bitcoin in particular! After we get through with this discussion, you’ll be aware of the many ways to buy bitcoins. Let’s not get ahead of ourselves here, however. Let’s return to the very basics for this.
What is Bitcoin and what Makes it Reliable?
Bitcoin is a digital currency or cryptocurrency as it’s been called. It’s not a payment service that accepts various forms of currency. Bitcoin is currency! How can currency be digital? Wouldn’t there would have to be some sort of digital process giving it value? You’re on the right track if these are the questions that you are asking. People invest in large servers and spend time, money and effort digitally mining the bitcoin database! This gives it actual currency value.
Well, the currency is digital, and it has established value, but what makes it reliable or safe? This is a good question when dealing with any form of currency; no doubt. Nobody wants their funds to vanish. If a dollar exists, it exists! How do we digitally replicate this almost philosophical declaration? Through blockchain technology! Blockchain technology describes a digital record that is presented, along with chronological adjustments, and cannot be altered or misrepresented.
Get to the Buying Process Already!
There are essentially three different methods of acquiring Bitcoin with one’s existing currency. Bitcoin exchanges exist as do peer-to-peer networks and even Bitcoin ATM’s! Some cities even have cryptocurrency ATM’s.
How does a Bitcoin Exchange Work?
A Bitcoin exchange is simply a large market ran by a company that allows a consumer to purchase cryptocurrencies with his existing bank account. As you can probably imagine, some exchanges are Bitcoin specific while others allow a wide variety of cryptocurrency purchasing/exchange options. This is the route that most consumers go when they purchase Bitcoin for the first time.
Did You Say Something About a P2P Network for This Sort of Thing?
As previously discussed, there is a peer-to-peer network buying option for purchasers of cryptocurrencies. A P2P network allows the consumer to browse listings from other peers that have crypto holdings that they would like to liquidate. This form of buying is a bit more advanced and is typically sought out by those that already have a bit of Bitcoin experience under their belt!
Last but Not Least: The Bitcoin ATM!
A few companies have begun placing Bitcoin ATM in various cities. Any city where such an option is present clearly presents the most convenient and attractive buying option while traveling or on the go. These machines are starting to really take off. In a few years, who knows how many cities will have them?