Bitcoin Hits 50k, but What Is Bitcoin?

First of all, I know nothing about Bitcoin. SO, I suppose this is your best chance at getting an unbiased look as to what exactly it is. Because I had to figure that part out too. And don't worry, I am not here to flex on you because of how well Bitcoin is doing and because I have some (not entirely sure if that how it even works, but don't worry, we will both know by the end). I do not have any investment into this happening business (business?) just yet, but what I do know is that 50,000 dollars is a lot, and currently, that is how much Bitcoin is worth. So, connecting two and two, I have decided it is time to get some knowledge.

What is bitcoin, and how does it work?

Bitcoin is a type of digital currency stored in a digital wallet. The transaction process of using bitcoin promises lower transaction fees than other online methods. Unlike government-issued currencies, it is operated by a decentralized authority, therefore needing no exchange rate or other intermediaries. In simpler terms—no one is "in charge" of bitcoin and how its users choose to operate. There is no middleman between transactions. What is yours is yours! You can profit from bitcoin without having to work around any strings attached. As Satoshi Nakamoto describes in his article, Bitcoin: A Peer-to-Peer Electronic Cash System"Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weaknesses of the trust-based model." Basically, online buying and selling always have to be done through someone else. It is not buyer to seller, seller to buyer. It is buyer to middleman to seller. And for what? As Nakamoto puts it, "What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party." A system where it truly is, buyer to seller, seller to buyer. According to him, bitcoin does just that. It creates a system "for electronic transactions without relying on trust." Sounds pretty legit.

How and where did it start?

It started in 2009, but the little-bit-spooky part is nobody knows who exactly started it—an invisible currency made by an invisible person. Technology is kinda weird.

Where is it now?

Currently, Bitcoin is the most popular cryptocurrency. Cryptocurrency is digital money, crypto—meaning hidden—and currency—meaning money! There are other cryptocurrencies, Bitcoin is just worth the most! There is no such thing as a physical bitcoin. Bitcoins are computer files stored in a digital wallet located on a computer drive or on a smartphone. It is not physical, tangible money, but it is a valuable currency, nonetheless. Its value as of today

(2/18/2021 - 4:54 p.m. EST) is valued at over $52,000. When I started this article, it had JUST hit 50,000. Clearly, bitcoin is going somewhere.

Why is it worth so much?

Bitcoin is currently worth so much because of the "hype" surrounding it. Many influential people have talked about bitcoin in a good light, leading to many people investing in it, causing its value to skyrocket. One particular individual who recently did so was the second richest man globally—Elon Musk, CEO of Tesla and CEO/founder of SpaceX, among other things. In a Clubhouse app audio chat conversation, Elon said, "I do at this point think bitcoin is a good thing, and I am a supporter of bitcoin." That was after he added "#bitcoin" to his bio on Twitter, and bitcoin prices jumped up 20 percent.

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How much will it be worth?

The future of Bitcoin, as well as all cryptocurrencies, is very unpredictable. When bitcoin first started, it was essentially worthless. It didn't gain any substantial value until around 2013 where it finally hit triple-digit values per BTC (bitcoin value). Since then, the market has fluctuated vastly, as well as skyrocketed. However, since it is so new and not everyone uses it nor knows about it, and there's no saying that it will stay stable. That doesn't mean, however, the predictions aren't looking up. According to Mark Yusuko, a highly successful investor, in an interview with Business Insider, "By 2025, we're likely to see $250,000 bitcoin, and then some time out, 2030, we could see $400,000 or $500,000 bitcoin as it reaches gold equivalence." That is a steep hill headed up, up, up, and I definitely want to be on board. 

How do you get involved?

The most popular and easy-to-do method of getting involved in Bitcoin is to buy some, just like investing in other stocks, only much more unpredictable. Another way is by Bitcoin mining. Mining for Bitcoin is a process where you rent out your own powerful computer components to brokers. This process is called "renting out hash," and this "hash" is used to validate and transfer bitcoin transactions throughout the world from user to user. Because bitcoin is entirely digital and there is no physical coin or transactions, it is necessary to have powerful computers able to handle the busywork. You are paid in bitcoin for allowing for your computer to be used in the process. (Note that this isn't for just any old laptop—it is for incredibly powerful (and incredibly expensive) personal computers or "pc" s). So, you can either buy a tiny, tiny, tiny portion of a bitcoin and work your way up to owning more, and therefore gaining more "worth", or lend out your superman computers to individuals using them to make it all happen.

I started this article when Bitcoin had just hit $50,000. It is now worth, as I am sitting here typing, $56,117. That is only within four days. It is time to get on it, I'd say.

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