/r/Bitcoin FAQ – Newcomers please read

Source : /r/Bitcoin FAQ – Newcomers please read
Welcome to the /r/Bitcoin Sticky FAQYou’ve probably been hearing a lot about Bitcoin recently and are wondering what’s the big deal? Most of your questions should be answered by the resources below but if you have additional questions feel free to ask them in the comments. The following videos are a good starting point for understanding how bitcoin works and a little about its long term potential:Video 1: What Is Bitcoin & Why Should You Care?Video 2: The real value of bitcoin and crypto currency technologyVideo 3: Bitcoin Is Independent MoneyVideo 4: Bitcoin 101 – Balaji SrinivasanFor some more great introductory videos check out Andreas ’s YouTube playlists, he is probably the best bitcoin educator out there today. Also have to give mention to James D’Angelo’s Bitcoin 101 Blackboard series. Lots of additional video resources can be found at the videos wiki page or /r/BitcoinTV. Key properties of bitcoinLimited Supply – There will only ever be 21,000,000 bitcoins created and they are issued in a predictable fashion, you can view the inflation schedule here. Once they are all issued Bitcoin will be truly deflationary. The halving countdown can be found here.Open source – Bitcoin code is fully auditable. You can read the source code yourself here.Accountable – The public is transparent, all transactions are seen by everyone.Decentralized – Bitcoin is globally distributed across thousands of nodes with no single point of failure and as such can’t be shut down similar to how Bittorrent works.Censorship resistant – No one can prevent you from interacting with the bitcoin network and no one can censor, alter or block transactions that they disagree with, see Operation Chokepoint.Push system – There are no chargebacks in bitcoin because only the person who owns the address where the bitcoins reside has the authority to move them.Low fee – Transactions fees can vary between a few cents and a few dollars depending on network demand and how much priority you wish to assign to the transaction. Most wallets calculate the fee automatically but you can view current fees here.Borderless – No country can stop it from going in/out, even in areas currently unserved by traditional banking as the is globally distributed.Trustless – Bitcoin solved the Byzantine’s Generals Problem which means nobody needs to trust anybody for it to work.Pseudonymous – No need to expose personal information when purchasing with cash or transacting. Secure – Encrypted cryptographically and can’t be brute forced or confiscated with proper key management such as hardware wallets.Programmable – Individual units of bitcoin can be programmed to transfer based on certain criteria being metNearly instant – From a few seconds to a few minutes depending on need for confirmations. After a few confirmations transactions are irreversible.Peer-to-peer – No intermediaries with a cut, no need for trusted third parties.Portable – Bitcoins are digital so they are easier to move than cash or gold. They can even be transported by simply remembering a string of words for wallet recovery.Scalable – Each bitcoin is divisible down to 8 decimals allowing it to grow in value while still accommodating micro-transactions.Designed Money – Bitcoin was created to fit all the fundamental properties of money better than gold or fiatSome excellent writing on Bitcoin’s value proposition and future can be found here. Bitcoin statistics can be found here, here and here. Developer resources can be found here and here. Peer-reviewed research papers can be found here. The number of times Bitcoin was declared dead by the media can be found here. Scaling resources here, and of course the whitepaper that started it all.Where can I buy bitcoins?BuyBitcoinWorldwide.com and Howtobuybitcoin.io are helpful sites for beginners. You can buy or sell any amount of bitcoin and there are several easy methods to purchase bitcoin with cash, credit card or bank transfer. Some of the more popular resources are below, also, check out the bitcoinity exchange resources for a larger list of options for purchases. Bank TransferCredit / Debit cardCashCoinbaseCoinbaseLocalBitcoinsGeminiBitstampLibertyXGDAXBititMycelium LocalTraderBitstampCex.ioBitQuickKrakenCoinMamaWallofCoinsXapoBitcoinOTCCex.ioitBitBititBitsquareHere is a listing of local ATMs. If you would like your paycheck automatically converted to bitcoin use Cashila or Bitwage. Note: Bitcoins are valued at whatever market price people are willing to pay for them in balancing act of supply vs demand. Unlike traditional markets, bitcoin markets operate 24 hours per day, 365 days per year. Preev is a useful site that that shows how much various denominations of bitcoin are worth in different currencies. Alternatively you can just « 1 bitcoin in (your local currency) ».Securing your bitcoinsWith bitcoin you can « Be your own bank » and personally secure your bitcoins OR you can use third party companies aka « Bitcoin banks » which will hold the bitcoins for you.If you prefer to « Be your own bank » and have direct control over your coins without having to use a trusted third party, there are many software wallet options here. If you want easy and secure storage without having to learn computer security best practices, then a hardware wallet such as the or is recommended. A more advanced option is to secure them yourself using paper wallets generated offline. Some popular mobile and desktop options are listed below and most are cross platform.AndroidiOsDesktopMyceliumBreadWalletElectrumCoPayAirBitzArmoryIf you prefer to let third party « Bitcoin banks » manage your coins, try or but be aware you may not be in control of your private keys in which case you would have to ask permission to access your funds and be exposed to third party risk.Another interesting use case for physical storage/transfer is the Opendime. Opendime is a small USB stick that allows you to spend Bitcoin by physically passing it along so it’s anonymous and tangible like cash. Note: For increased security, use Two Factor Authentication (2FA) everywhere it is offered, including email! 2FA requires a second confirmation code to access your account, usually from a text message or app, making it much harder for thieves to gain access. Authenticator and Authy are the two most popular 2FA services, download links are below. Make sure you create backups of your 2FA codes. AuthAuthyAndroidAndroidiOSiOSWhere can I spend bitcoins?A more comprehensive list can be found at the Trade FAQ but some more commons ones are below.StoreProductGyftGift cards for hundreds of retailers including , Target, Walmart, Starbucks, Whole Foods, CVS, Lowes, Home Depot, iTunes, Best Buy, Sears, Kohls, eBay, GameStop, etc.Steam, HumbleBundle, Games Planet, itch.io, g2g and kinguinFor when you need to get your game onMicrosoftXbox games, phone apps and softwareSpendabit, The Bitcoin Shop, Overstock, DuoSearch, The Bitcoin Directory and BazaarBayRetail shopping with millions of resultsShakePayGenerate one time use cards in secondsNewEgg and DellFor all your electronics needsCashila, Bitwa.la, Coinbills, Piixpay, Bitbill.eu, Bylls, Coins.ph, Bitrefill, Pey.de, LivingRoomofSatoshi, Hyphen.to, Coinsfer, GetPaidinBitcoin, Coins.co.th, More #1, #2Bill paymentFoodler, Menufy, Takeaway, Thuisbezorgd NL, Pizza For CoinsTakeout delivered to your door!Expedia, Cheapair, Lot, Destinia, BTCTrip, Abitsky, SkyTours, Fluege the Travel category on Gyft and 9flatsFor when you need to get awayBoltVM, BitHostVPS serviceCryptostorm, Mullvad, and PIAVPN servicesNamecheap, PorkbunFor new domain name registrationStampnik and GetUSPSDiscounted USPS Priority, Express, First-Class mail postageReddit GoldPremium membership which can be gifted to othersCoinmap, 99Bitcoins and are helpful to find local businesses accepting bitcoins. A good resource for UK residents is at wheretospendbitcoins.co.uk.There are also lots of charities which accept bitcoin donations, such as Wikipedia, Red Cross, Amnesty International, United Way, ACLU and the EFF. You can find a longer list here.Merchant ResourcesThere are several benefits to accepting bitcoin as a payment option if you are a merchant;1-3% savings over credit cards or PayPal.No chargebacks (final settlement in 10 minutes as opposed to 3+ months).Accept business from a global customer base.Increased privacy.Convert 100% of the sale to the currency of your choice for deposit to your account, or choose to keep a percentage of the sale in bitcoin if you wish to begin accumulating it.If you are interested in accepting bitcoin as a payment method, there are several options available;BTCPayCoinbaseCoinifySnapcardGoCoinMycelium Gear (direct to your wallet)Blockonomics (direct to your wallet)BitapsStripeCan I mine bitcoin?Mining bitcoins can be a fun learning experience, but be aware that you will most likely operate at a loss. Newcomers are often advised to stay away from mining unless they are only interested in it as a hobby similar to folding at home. If you want to learn more about mining you can read more here. Still have mining questions? The crew at /r/BitcoinMining would be happy to help you out. If you want to contribute to the bitcoin network by hosting the blockchain and propagating transactions you can run a full node using this setup guide. is an easy option for getting set up. You can view the global node distribution here.Earning bitcoinsJust like any other form of money, you can also earn bitcoins by being paid to do a job.SiteDescriptionWorkingForBitcoins, Bitwage, XBTfreelancer, Cryptogrind, Bitlancerr, Coinality, Bitgigs, /r/Jobs4Bitcoins, Rein ProjectFreelancingOpenBazaar, .io, Bitify, /r/Bitmarket, 21 MarketMarketplacesWatchmybit, Streamium.io, OTika.tv, XOtika.tv NSFW, /r/GirlsGoneBitcoin NSFWVideo StreamingBitasker, BitforTip, WillPayCoinTasksSupload.com, SatoshiBox, JoyStream, File ArmyFile/Image SharingCoinAd, A-ads, Coinzilla.ioAdvertisingYou can also earn bitcoins by participating as a market on JoinMarket by allowing users to perform CoinJoin transactions with your bitcoins for a small fee (requires you to already have some bitcoins)Bitcoin ProjectsThe following is a short list of ongoing projects that might be worth taking a look at if you are interested in current development in the bitcoin space.ProjectDescriptionLightning Network, Amiko Pay, and StrawpayPayment channels for network scalingBlockstream and DrivechainSidechains21, Inc.Open source library for the machine payable webShapeShift.ioTrade between bitcoins and altcoins easilyOpen Transactions, , Omni, Open Assets, and ChainFinancial asset platformsHivemind and AugurPrediction marketsMirrorSmart contractsMediachainDecentralized media libraryTierion and FactomRecords & Titles on the blockchainBitMarkets, DropZone, Beaver and Open BazaarDecentralized marketsSamourai and Dark Wallet – abandonedPrivacy-enhancing walletsJoinMarketCoinJoin implementation (Increase privacy and/or Earn interest on bitcoin holdings)Coinffeine and BitsquareDecentralized bitcoin exchangesKeybase and BitratedIdentity & Reputation managementBitmesh and TelehashMesh networkingJoyStreamBitTorrent client with paid seedingMORPHiSDecentralized, encrypted internetStorj and SiaDecentralized file storageStreamium and FaradamPay in real time for on-demand servicesAbraGlobal P2P money transmitter networkbitSIMPIN secure hardware token between SIM & PhoneIdentifiDecentralized address book w/ ratings systemCoinometricsInstitutional-level Bitcoin Data & ResearchBlocktrail and BitGoMultisig bitcoin APIBitcoreOpen source Bitcoin javascript libraryInsightOpen source blockchain APILeetKill your friends and take their money Bitcoin UnitsOne Bitcoin is quite large (hundreds of £/$/€) so people often deal in smaller units. The most common subunits are listed below:UnitSymbolValueInfomillibitcoinmBTC1,000 per bitcoinSI unit for milli i.e. millilitre (mL) or millimetre (mm)microbitcoinμBTC1,000,000 per bitcoinSI unit for micro i.e microlitre (μL) or micrometre (μm)bitbit1,000,000 per bitcoinColloquial « slang » term for microbitcoinsatoshisat100,000,000 per bitcoinSmallest unit in bitcoin, named after the inventorFor example, assuming an arbitrary exchange rate of $500 for one Bitcoin, a $10 meal would equal:0.02 BTC20 mBTC20,000 bitsFor more information check out the Bitcoin units wiki.Still have questions? Feel free to ask in the comments below or stick around for our weekly Mentor Monday thread. If you decide to post a question in /r/Bitcoin, please use the search bar to see if it has been answered before, and remember to follow the community rules outlined on the sidebar to receive a better response. The mods are busy helping manage our community so please do not message them unless you notice problems with the functionality of the subreddit. A complete list of bitcoin related subreddits can be found hereNote: This is a community created FAQ. If you notice anything missing from the FAQ or that requires clarification you can edit it here and it will be included in the next revision pending approval. Welcome to the Bitcoin community and the new decentralized economy! submitted by /u/BinaryResult [link] [comments]

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