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The Idea Behind Bitcoin

Last Updated on January 21, 2022 by InfomediaNG

Bitcoin is one of the unimaginable inventions by mankind in the financial world as anyone irrespective of location, race, banked or banked can receive payment with their wallet. In guide covers the three simplest ways to convert your bitcoin to the local currency (Naira) if anyone sends you money.

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As the blockchain, the technology that powers bitcoin, continues to evolve, cryptocurrency exchange firms continue to come up with innovations that even make it easier to receive payment or gift from a colleague and convert crypto to Naira.

That’s one of the reasons, bitcoin enthusiasts around the world are marvelled about blockchain. One of them is Roger Ver (Bitcoin jesus) CEO of Bitcoin.com when he said:

“Bitcoin is one of the most important inventions in all of human history. For the first time ever, anyone can send or receive any amount of money with anyone else, anywhere on the planet, conveniently and without restriction.
It’s the dawn of a better, more free world”.

Getting Started

Before starting to receive bitcoin, it’s important to understand what Bitcoin is and how it has provided solutions to some of the financial problems in the past.

To carry out the task of “changing” your bitcoin to naira, we divided this guide into two parts: 1) understanding btc, 2) ways to convert btc to naira

Note: Bitcoin has its challenges and poses some security threat in the financial world.

Understanding BTC

Bitcoin is a digital coin, created and held electronically in BTC Wallet. No one controls it. Bitcoins aren’t printed, like Naira, dollars or any other fiat currencies. Bitcoin is generated by people using software via computers all around the world to solve mathematical problems.

It’s known as the leader of other digital currencies. It was the first crypto to hit the world. Its invention culminated in the development and creation of other coins like Ethereum, Litecoins, BitcoinCash, Binance Coin and more than 200 other coins around the world.

Bitcoin is based on mathematics. Interested miners globally use software programs that follow a mathematical formula to produce bitcoins.
The mathematical formula is freely available for anyone to check it, we’re not going into that in this article.

This invention has brought about countries launching their own Central Bank Digital Currency (CBDC) like eNaira in Nigeria.

Who is Bitcoin Creator?

It was created by a software developer called Satoshi Nakamoto, a few people saw the success of the invention when it was revealed. The true identity of Satoshi remains a mystery. How could a man who invented the greatest and most controversial coin remain anonymous? Although, a few individuals have come up to claim they are Satoshi.

Idea Behind BTC

The idea behind the bitcoin invention was to have a currency independent of any government authority, transferable electronically, instantly, with affordable transaction fees.

Can Bitcoin Be Printed?

It cannot be printed and that’s why it’s called Digital Currency. Bitcoin is created digitally, by a community of people called bitcoin miners which can be joined by anyone because mining bitcoin is the most technical aspect of it, which makes it easier to mine collectively than individually. Bitcoins are ‘mined’, using computing power in a distributed network.

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There is bitcoin protocol – the rules that make bitcoin work – that say that only 21 million bitcoins can ever be created by miners.

However, these coins can be divided into smaller parts (the smallest divisible amount is one hundred millionth of a bitcoin and is called a ‘Satoshi’, after the founder of bitcoin).

What Makes Bitcoin Different Fiat Currencies?

One of the major things that make bitcoin different from Naira and other conventional currencies is Decentralization, it’s used to make purchases electronically.

It’s not controlled like other existing normal currencies like naira, dollars, euros that are consistently controlled by the government.
Nobody or institution controls the bitcoin network. No bank controls it.

Major Characteristics Of Bitcoin

Major features that make bitcoin unique from fiat currencies are:

  • Its network is decentralized
  • Easy account setup unlike the conventional banks that require paperwork.
  • It’s faster
  • No charges sending bitcoin
  • Bitcoin is anonymous
  • Bitcoin transaction is irreversible

Decentralized Network

Bitcoin network is decentralized, it is not controlled by anyone or any central authority. The machine that generates bitcoin work together over a network independent of any control.

Easy Bitcoin Wallet Set up

To open a bank account in Nigeria or in any part of the world, your identity must be known, even as online banking as taken up the paper regime.

However, you can set up a bitcoin wallet in seconds, no questions asked, and with no fees payable.

From your Bitcoin Wallet, you can send and receive bitcoin from others from any part of the world within seconds, though traffic on the network can cause little delay, but it’s still faster than other means.

Faster Transfer

You can send money anywhere from your bitcoin wallet to another wallet within seconds, as soon as the bitcoin network processes the payment.

No Charges

Your bank may charge you N500 fee for international transfers, or for transferring from one bank to another, but bitcoin doesn’t unless you’re using a third-party bitcoin exchanger which may charge a little fee for its service.

Bitcoin is anonymous

Users can hold as multiple bitcoin addresses as possible, they have as many BTC wallets as possible. You need fingerprint to detect your BVN in the banking industry as it is in the Nigerian banking system.

For bitcoin, all you need to do is to keep your address and login details safe from hackers. Once your BTC wallet is hacked, all that you have there is gone.

This makes it easier for an underage to acquire bitcoin without breaking the law of their country. There are several ways they can accomplish this acquisition.

Irreversible Transfer

Once the transfer is effected on bitcoin from one bitcoin wallet to the other, there is no means to cancel the transfer or retrieve it, unless the recipient personally knows you.

Wrapping up:

When Hal Finney received the first BTC transaction from Satoshi to test the success of the blockchain technology, the idea behind bitcoin was to ensure that it’s absolutely free from interference from the government or third party from regulatory agencies.

Featured Image:

  • By Pixabay
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