Mega Moolah's top 10 Bitcoin FAQs
Anyone who has experience in the cryptocurrency space has at least heard of Bitcoin. There is no denying that Bitcoin is the most dominant cryptocurrency on the market, the cryptocurrency by which all others are compared. Yet there is more to Bitcoin than just buying or selling. There is more to it than depositing bitcoins at your favorite casino so you can play Mega Moolah.
Bitcoin is so complex that it would be impossible to write a detailed explanation of every single aspect and keep such a writing to a reasonable size. Therefore, we thought a better way to give readers a better understanding of Bitcoin would be to discuss the top 10 FAQs related to this revolutionary monetary platform. So if you're ready, let's get started.
1. What is Bitcoin, exactly?
We start with this question because of all the misunderstanding surrounding Bitcoin. Bitcoin is, first and foremost, a peer-to-peer monetary system. Its designation as a peer-to-peer system makes it clear that Bitcoin transactions are conducted directly between buyers and sellers - with no intermediaries involved.
When you deposit bitcoins at an online casino you found here at MegaMoolah.com, that deposit occurs without the need for your bank or credit card company to act as a middleman. The BTC you deposit flows directly from your digital wallet to the casino's digital wallet. Simple enough.
Next, Bitcoin is also an application. Remember that there are no physical coins or bills involved in bitcoin transactions. Everything is accomplished via the computer code found in the Bitcoin Core. That computer code, which is essentially an application, is what makes everything work.
2. How are bitcoins acquired?
There are several ways to acquire bitcoins. The first is to purchase them on an exchange. A cryptocurrency exchange, like a stock exchange, is a centralized online location where buyers and sellers meet to do business. Exchanges can be local, regional, or global.
Bitcoin can also be acquired through Bitcoin ATMs, which are located all over the world these days, or from P2P trading websites such as Localbitcoins.com. The other way to acquire bitcoin is to accept them as payment for goods or services. This means of acquisition still requires having a digital wallet, but it doesn't require spending fiat currency to purchase your coins. You simply receive them into your wallet as payment.
Purchasing bitcoins requires having a means of storing them. This involves what is known as a 'digital wallet' such as what Blockchain.com offers. A digital wallet can be software-based, hardware-based, or even just a paper ledger in which the buyer writes the necessary information. With a digital wallet and an e-mail address, a buyer can go on an exchange and purchase coins from any of the sellers with available offers.
3. Who keeps records of Bitcoin transactions?
When you do business under the traditional model, all records of your transactions are kept somewhere. So let's say you use your debit card to put fuel in your car. The record generated by that transaction is sent to your bank for verification and storage. The merchant also keeps a record and provides you with a receipt, which is your record.
In the Bitcoin world, there are no third parties involved. That means there is no bank keeping records of your transactions. Transactions are recorded and verified in the Bitcoin blockchain. You and the other party involved in your transaction have a record of the activity stored in your digital wallets.
4. What is the Bitcoin blockchain?
Understanding how transactions are recorded leads to the obvious question of Bitcoin's blockchain. The blockchain is essentially a computerized ledger system developed for the purposes of keeping track of bitcoins, who owns them, and how they are being traded. Think of it as an electronic version of a paper bank account ledger.
Blockchain gets its name from the structure of the data within. All data generated by Bitcoin transactions is entered into a block of a given size. Once a block reaches its capacity, it is closed and added to the end of the ledger. A new block is subsequently started.
This process of creating and closing blocks creates a chain of blocks linked in succession from the top of the ledger to the bottom. That chain of blocks is your blockchain.
5. Where does this blockchain exist?
Bitcoin was intended, from its inception, to be completely decentralized. As such, no one entity owns or controls the blockchain. In fact, there are dozens of copies of Bitcoin's blockchain scattered all over the world. Each computer node involved in Bitcoin mining has a copy of the blockchain. Anyone who wants a copy can freely download it without issue.
6. What is Bitcoin mining?
In order to maintain security and legitimacy, Bitcoin's developers had to create a means of processing transactions in such a way as to prevent fraud. They came up with a process known as 'mining'.
Every time a transaction takes place, encrypted data from that transaction is sent across the Bitcoin network to each and every node on the system. Those nodes, which are essentially massive computer servers, must then go through the arduous process of decrypting the data, solving a complex mathematical equation, and then verifying the transaction.
This process is known as mining. In order to incentivize minors to do what they do, the Bitcoin platform rewards the first miner to successfully verify a transaction with bitcoin (BTC). So yes, miners earn their own coins by performing the work of mining. Without mining there would be no Bitcoin platform.
7. How is the ledger kept secure?
Given that Bitcoin's blockchain was developed as a distributed ledger, there is legitimate curiosity as to how it remains secure. After all, the fact that anyone can freely download a copy suggests that they can also do something with the data it contains.
Security is maintained through a combination of data encryption and proof-of-work. The encryption utilizes something known as 'asymmetric cryptography' to make it nearly impossible to crack coded data found in Bitcoin's ledger. In order to decrypt the data, you would need both public and private keys. But only senders possess private keys.
Proof-of-work is a means of forcing nodes to complete complex mathematical equations in order to verify transactions. Every node on the network must reach the same solution to the equation before a transaction can be made permanent. This makes it nearly impossible to create fraudulent transactions or alter legitimate ones.
8. Is buying and selling via Bitcoin anonymous?
Anonymity is often touted as one of the selling points of using bitcoin for online transactions. Unfortunately, true anonymity does not exist on the Bitcoin network. However, user identities are still protected through something known as 'pseudonymity'.
All the transactions found in Bitcoin's ledger are linked to digital identities, or addresses. No one knows who those addresses belong to because they are randomly generated without any identifying information. So even if someone was able to break the cryptography, they still wouldn't be able to tell who owns individual addresses and the coins associated with them.
The use of these digital addresses is similar to using a pseudonym as a writer. Anybody who read your article could also read your pseudonym, but they still wouldn't know who you really are. That is how Bitcoin protects individual identities.
9. Is Bitcoin legal tender?
Based on the dictionary definition of 'legal tender', bitcoins do not qualify in any country that we know of. However, there are numerous countries in which cryptocurrencies are recognized as a legitimate means of paying for things. Japan is a good example.
The Japanese government does not recognize bitcoins as legal tender. That means the government does not endorse bitcoins as an official currency, nor does it consider bitcoins a form of currency that merchants must accept by law. However, the government does recognize bitcoins as a legitimate way to transact business among agreeing parties.
10. Is Bitcoin considered an investment?
Investing in Bitcoin and other cryptocurrencies is, as the British might say, a sticky wicket. Bitcoin's developer never intended the platform to be primarily an investment. Rather, it was created as a monetary system that offered decentralized economic freedom to all who participated.
It didn't take long for investors to see the potential of Bitcoin upon its original launch in 2009. They waited by the sidelines to see if the platform would take off as a peer-to-peer payment system. When it did, some of those investors began pouring substantial amounts of money into the platform, buying up as many digital coins as they could.
Investor interest in Bitcoin sparked similar interest in other cryptocurrencies. That led to initial coin offerings (ICOs) from new players looking to attract investor money. Today's cryptocurrency environment has changed very little. You have day-to-day users on the one hand and large-scale investors on the other.
Hopefully this guide has helped you better understand what Bitcoin is. If you have never used bitcoins to play Mega Moolah at your favorite online casino, you might want to give it a try. Purchasing and depositing bitcoins makes it possible for you to do business directly with your casino without any need for banks or credit cards.
Moreover, online casinos have a habit of offering generous Bitcoin bonuses to attract cryptocurrency users. You could get quite a bit added to your bankroll as a 'thank you' gift upon making your first deposit. That means more credits to play Mega Moolah.
Byline: This article was published by Mega Moolah expert Henry. Media and other enquiries.