What is a bitcoin faucet? How a Bitcoin faucet work? Does bitcoin work? I will try to answer these and more questions below.
First, let me explain what a bitcoin is. You can find a very detailed article on Wikipedia. For those who don’t want to read all of this, I have (I hope) a shorter version. If you are a “movie person” find out more about Bitcoin under two minutes:
Coin Bitcoin is divisible up to 8 decimal places. 0.00000001 BTC is the minimal fraction of Bitcoin.
1 BTC = 1 Bitcoin (1 BTC).
0.01 BTC = 1 cBTC (1 Bitset, 1 Bitcoin cent).
0.001 BTC = 1 mBTC (1 Milli-bitcoin).
0.000001 BTC = 1 micro-bitcoin.
0.00000001 BTC = 1 Satoshi (smallest fraction of a coin bitcoin, named after the Creator of Bitcoin, Satoshi Nakamoto)
To have a better understanding of this virtual currency, we need to go back to 2008. At this time, we had the biggest financial crisis in history. Tens of currencies were losing the value – it meant that valuation and dependency on each other can cause a catastrophe in the future.
In the same year person hiding under the nick of Satoshi Nakamoto (You can read the article: Who is Satoshi Nakamoto – it’s like the short criminal story) created a Bitcoin. Highly possible that behind the success wasn’t just one person, but a group of programmers and mathematicians.
In the beginning, it was just next eye-catching idea from the Internet. On MtGox stock market it had a value 1B = 0,063$. Every year bitcoin was getting higher value – even about 1400%! Bitcoin is a sequence of signs that hides the code. You can’t touch it or see it, but you can use it to buy services and products.
How do you get bitcoins?
There are three options to get a bitcoin.
- As this virtual currency is getting more popular every single day, you can find market exchange or internet cantor. I would recommend using a site that is working for a long time to be safer.
- Mining a bitcoin. In this case, you buy a miner. You need massive computer power, or you can join a mine with other people. Safe and attractive between other miners is Cex.io.
- Faucet – yes, just like in your kitchen. Every few minutes (5-20 minutes) you need to do some action (captcha, watch an ad, play the game) and in return, you get free bitcoin units (Satoshi). The value is not that high (Satoshi Rate), but if you don’t want to invest anything in buying a miner, it’s always something.
Is Bitcoin Mining Worth it?
What is a bitcoin mining? Did you read the article on Wikipedia? So you know that there is a limited amount of bitcoins – 21 million. Few years ago everything was simple. Bitcoin value was low, the cost of the mine was small as well. Today it looks completely different.
How the mining work? It is sharing computer power to solve cryptographic issues. It doesn’t sound so complicated, but it can’t be done by standard laptop on your desk. Now mining pools looks like that:
Yes, it’s similar now to the server room, with high consumption of power as it’s digging all the time, 24/7. In practice, it is not worth it to invest money on smaller miners, even where there is plenty of advertisement on EBay or Amazon. As professional equipment to dig bitcoins is extremely expensive, people are gathering together to create mining pool to share their computer power. Benefits are split for every miner depending on the power they added.
You can be one of them as well. How? You can build something like on a picture above (what is very expensive) or buy a share in existing pool. There is no need to do the first thing as right now, almost half of the mining market is covered by independent players who buys their shares in mining pools. They pay for the computing power and electricity. The best on the market is currently CEX.io.
Computing power is given in Gigahash – Ghash/s. The higher amount, the better – means it can dig more bitcoins in a shorter time. Profits are adequate to the investment. If you buy 10 Ghash/s, there is a high possibility that you will get 0,2-0,3 Bitcoin in a month and miner will still be running every day. CEX.io is working without a commission, you don’t need to worry about the electricity bills, the system works 24 hours per day, seven days in a week. After the investment you just need to watch how the digging is going.
If you come to the conclusion that the profit is too small, or you are bored with it, you can sell your shares. You can do it again with CEX.io.
In my opinion, it is the most attractive and safest option confirmed by thousands of people using this market every day. If you want to start doing it, you need to know that it is hard to find a good alternative. You can always build your miner like on a picture above.
What is a bitcoin wallet?
It’s simple. Where do you keep most of your money? In the bank. Where do you think you can keep your bitcoins? On the unique wallet. How can you do it? Create one, for example here: Coinbase. It’s an affiliate link, so if you buy a bitcoin for 100$, we BOTH will get 10$ extra!
Why do I recommend Coinbase? As sending, requesting and getting bitcoins is free AND you can exchange them for the euro, dollars with 1% fee. You can use a different wallet, but without the cantor, so you need to create a second account on online bitcoin cantor, send them bitcoins, exchange it, send it to your account. As I am a lazy person, I like to have everything in one place. Bitcoin wallets are very safe and anonymous. You don’t need to provide them with your ID or date of birth. Registration lasts few second, and that’s it. You are the owner of your virtual currency.
Is bitcoin wallet safe?
Yes, but it depends on you. Your wallet ID is just a string of characters, and you need to keep it safe.
How to use bitcoin wallet?
I will write the single post about Coinbase and his possibilities.
Is bitcoin safe?
There are only two things in life that are sure. Taxes and death. We all know it, but often we hope to be those lucky people and win something for the first time. Is investing in Bitcoin safe and profitable? What are the surprises you can find?
There is only one danger that can affect this virtual currency. Starting in 2008 Bitcoin was gaining and losing his value. Even when it’s free from the influence of central banks and other financial institution, speculators can change its value. We are not able to establish what will be the value of Bitcoin next week, next month or year. There were few situations that anonymous groups start selling their coins, lowering the total rate and when the price was low enough, they start to buy again. Buying coins on the market is the most popular method of gathering them. Of course, there is a chance to overpay, so more and more people are using bitcoin miners like CEX.io I mentioned above.
Speculation is the only danger for every Bitcoin user, but there are many more benefits.
What are the Bitcoin Benefits?
- The inflation does not influence Bitcoin, but deflation is because there are only 21 million The value will always be high enough for investors safety.
- All transactions are anonymous. Your signature and transaction are hidden in a unique code that can be changed every time.
- Fees are subtle.
- Transaction lasts few seconds. It doesn’t matter that you are sending money to the US, Europe or Australia.
- There is no refund. You have no risk that someone will return the product.
- Your account can’t be frozen.
- Using Bitcoins for payment is very simple.
- The system is very safe – it’s almost impossible to break into account if you keep safety procedures.
What is the best thing in that virtual currency? Safety and simplicity. Fox example you bought something online. Money transfer is going from your wallet. You have an individual code that goes to your contractor. Transfer authorization is letting know that money is changing his owner. “Web” knows about it and it prevents all scams or “printing” money. Some time ago it was possible to use Bitcoin only on the internet, right now you can buy coffee or other goods using your phone. Every day more and more spots allow to use it. It is a free advertisement for them, as media will talk about it. In Canada, you can find ATMs exchanging bitcoins for dollars.
If you have any questions, let me know in the comments below.
In my next post, I will show you Bitcoin faucets that I am using to get some coins.