Christmas has just gone by and we were inundated with questions from friends and family wanting to learn more about Bitcoin! They came to us with the misconception that it was far too difficult to understand and get involved in. Getting your first Bitcoin and managing your own assets might seem very daunting, but the world of cryptocurrencies has come a long way since its inception. It’s actually never been easier to get involved, and you certainly don’t need to be an expert to own Bitcoin!
BITCOIN 101
Bitcoin is a digital currency that allows users to transact person to person without a middle man, such as a bank, needing to manage or authorise the exchange of funds. Similarly to other assets, it is used in exchange for goods or services. However, unlike traditional currencies and assets, Bitcoin is easily portable, divisible, and irreversible.
Bitcoin is backed by Blockchain Technology, a digital ledger of transactions that is duplicated and distributed across the entire network of computer systems (nodes) on the blockchain. This makes it extremely difficult to change, hack, or cheat the system.
WHY SHOULD YOU USE IT?
There are many reasons why you should start using Bitcoin. Here are a few of our favourites:
- It was named the top performing currency four of the last five years
- You can send Bitcoin to anyone, anywhere in the world without worrying about hefty fees
- It’s globally inclusive, enabling millions of people around the world to take control of their financial future
- You don’t have to rely on a third party service to give you access to your funds, and there is no entity that can lock you out
- It’s independent, meaning no state, bank or institution can control or manipulate it
- There are only 21 million Bitcoins that will ever exist making it scarce and protected against inflation to preserve the value of your money
- You can transfer money around the world in just a few seconds
- The transaction fees are extremely low
- It’s pseudo-anonymous but also transparent (anonymous because you don’t need to identify yourself in the Bitcoin Network, transparent because the ledger of all transactions is public)
GETTING STARTED
Similar to the Internet, you don’t need to understand the technology behind Bitcoin to use it. And purchasing/managing Bitcoin is a lot easier than you’d think! A great Australian based start up that we’ve been directing our family and friends to is Amber. Using their phone based app, you can make your first Bitcoin purchase in under 90 seconds, from as little as $5.
SECURING YOUR COINS
It doesn’t take much to look after your Bitcoin. It’s simply a matter of learning and then following simple best practices. This includes:
- Removing your coins from a third-party service such as an exchange, and storing them on a secure hardware wallet
- Ensuring you keep your 24-word recovery phrase private and safe, using a recovery phrase device such as the Billfodl
- Never sharing the location of your Bitcoin, hardware wallet, recovery phrase etc
BECOMING PART OF THE BITCOIN COMMUNITY
If there’s one thing that can be said about the Bitcoin community it’s that we LOVE to educate others. Getting involved with the community is a great way to learn more and there is always someone willing to help out. Just make sure you NEVER disclose your private keys with anyone! You can join our community on Twitter & Facebook.