By: Nick Gambino
In just a handful of years Bitcoin has risen from relative obscurity to becoming a household word. And while everyone has heard of Bitcoin most, even those who’ve picked up some of the crypto coin for themselves, have no idea what it is.
You’ve likely heard about Bitcoin rising or falling, but to really understand where it’s going it’s important to understand what it is and its underlying mission. And in order to understand Bitcoin you have to understand the blockchain. I promise you this won’t turn into a Russian nesting doll of definitions.
The blockchain is a digital database where each piece of data is grouped into a block. Those blocks are then daisy chained together to create…wait for it…a blockchain. What that looks like and how it’s coded to perform that task isn’t entirely necessary to dive into for the purposes of this lesson. Just know, that a blockchain is a chain of chronological blocks that represent data.
Bitcoin is stored on a blockchain. This particular blockchain is essentially a digital and transparent ledger for all to see. The reason the underlying technology is important is because the mission of Bitcoin is to upend and overthrow traditional fiat currency. That means if they accomplish their mission, goodbye dollar bills and traditional banking.
There are a lot of vested interests who would prefer that not to happen, but more than that, Bitcoin has a ton of work to do to have the infrastructure in place to pull this off. Banks are institutions and there’s a lot of security and insurance set up to keep your money safe. Bitcoin has transparency going for it but still needs to lay in the groundwork.
The value of Bitcoin in the last few years is what has garnered the most attention. Ironically, it’s value is intrinsically linked to the U.S. dollar. In other words, we measure how valuable Bitcoin is by fiat currency.
At its peak last year, a single Bitcoin was worth more than $68,000. While it’s been hovering around half of that as of late, it’s still out of reach from its highest peak during its first explosion in 2017. And while there are countless other crypto coins on the market, Bitcoin will always be the OG. It’s the one that started it all and its value reflects that.
Now, deciding to invest in Bitcoin depends on why you’re getting into it. Are you excited for and committed to the Bitcoin mission? Do you want to see it become the new standard of currency? If so, then maybe it makes sense for you to go to a cryptocurrency exchange and pick up some Bitcoin or fractions of a Bitcoin.
If your interest in Bitcoin is solely to make some fiat currency much the way you would invest in stocks, you have to be weary of the fact that crypto is a volatile market with massive up and downswings. It’s not uncommon to see the value of Bitcoin go up and down by $10,000 in a single day.
If you’ve decided Bitcoin is for you then you can join Bitcoin Up and get started on your journey today.