Bitcoin 101: What is Bitcoin? (and How to Buy It)

If you’ve noticed a lot of talk about Bitcoin recently, you’re not alone. It’s becoming a common topic in finance discussions among everyone from tech enthusiasts to everyday people. But what is Bitcoin, and why is it important in modern finance? This blog post will cover the basics of Bitcoin, explaining what it is, how it works, and how you can buy it. By the end, you’ll have a solid understanding of this digital currency and how to enter the Bitcoin world safely.

What is Bitcoin?

Bitcoin was created in 2008 by an unknown person (or group) using the pseudonym Satoshi Nakamoto. The concept was revolutionary—a decentralized digital currency that operates independently of a central authority, such as a bank or government. This innovative approach aimed to empower individuals by providing them with a peer-to-peer electronic cash system, enabling online payments to be sent directly from one party to another without the need for intermediaries or financial institutions.

The underlying technology, blockchain, ensures transparency and security by recording all transactions in a public ledger that is unchangeable and distributed across a network of computers. The first Bitcoin transaction took place in January 2009, and since then, Bitcoin has evolved into a global phenomenon, attracting a wide range of users, from individual investors to institutional players. Its rise has not only sparked discussions about the future of money, but has also inspired the creation of thousands of alternative cryptocurrencies, collectively known as altcoins, further expanding the digital currency landscape. Today, Bitcoin is seen not just as a digital asset but also as a potential store of value, often referred to as “digital gold,” capturing the interest of both enthusiasts and skeptics alike.

Significance in Modern Finance

Bitcoin is considered a groundbreaking innovation in the financial world. It has introduced the concept of decentralized finance and has shown that financial transactions can be transparent, secure, and free from governmental control. Many see Bitcoin as “digital gold,” a store of value that can protect against inflation and economic instability.  For many, Bitcoin represents a way to participate in the global economy without the barriers imposed by traditional banking systems.

Understanding Bitcoin: How Does It Work?

Bitcoin operates on a technology called blockchain, a public ledger that records all Bitcoin transactions. This ledger is maintained by a network of computers (called nodes) that validate and record new transactions. Each transaction is grouped with others in a “block,” which is then added to the “chain” of previous blocks, hence the name blockchain.

When you send Bitcoin to someone, your transaction is broadcast to the network and confirmed by these nodes. This decentralized verification process ensures that transactions are secure and that the same Bitcoin can’t be spent twice. The transparency of the blockchain allows anyone to view transaction history, making it difficult for bad actors to tamper with the system.

Benefits and Risks of Bitcoin Ownership

Benefits

Owning Bitcoin has several advantages. First, it provides a level of financial autonomy that traditional currencies can’t offer. You control your Bitcoin, and no one can interfere with your transactions. Second, Bitcoin transactions are generally faster and cheaper than traditional banking methods, especially for international transfers. Lastly, Bitcoin can be a hedge against inflation, as its supply is capped at 21 million coins, making it a deflationary asset.

Risks

However, Bitcoin isn’t without risks. Its price is notoriously volatile, which can lead to significant gains or losses in a short period. Additionally, since Bitcoin operates in a decentralized manner, there’s no recourse if you lose your private key (the code that gives you access to your Bitcoin). It’s crucial to take proper security measures to protect your cryptocurrency.

How to Buy Bitcoin: Step-by-Step Guide for Beginners

How to Buy Bitcoin with Cash at a RockItCoin Bitcoin ATM

1. Find your nearest RockItCoin ATM on RockItCoin’s Bitcoin ATM map.
2. Select the ‘Buy Coins’ option on the ATM screen.
3. Enter your phone number to verify your identity.
4. Enter the amount you wish to purchase. Some machines will allow you to choose from a variety of preset amounts. Depending on the amount, you may need to verify your ID.
5. The ATM will ask for your Bitcoin wallet address. You can either scan the QR code of your wallet, print a paper wallet, or manually enter the alphanumeric code.
6. Then, you insert your cash into the machine.
7. The ATM will display the equivalent amount of Bitcoin you’ll receive at the current exchange rate including the fees.
8. Once you confirm the transaction, the Bitcoin will be sent to your wallet.

How to Buy Bitcoin Online with a Credit or Debit Card

1. Head to RockItCoin’s Buy Bitcoin Online page, fill out the form, and then select Bitcoin as the cryptocurrency you’d like to purchase.
2. Then, type in the dollar amount that you wish to purchase and enter your bitcoin wallet. If you need a Bitcoin wallet, download the RockItCoin app, available on the App Store and Google Play.
3. For security and compliance reasons, you will need to undergo an identity verification process.
4. Follow the instructions during the checkout process, review the transaction details, and enter your payment and billing information.
5. Once you’ve confirmed your purchase, your newly acquired Bitcoin will be deposited into your wallet typically within 15-45 minutes. 

How to Buy Bitcoin with Cash at a Retailer Using RockItCoin Go

1. Download the RockItCoin app and create an account.
2. Place your order for Bitcoin within the app.
3. Generate a barcode on the app to load funds at a participating retail location. You can view nearby retail locations on the Map tab in the app.
4. Present your barcode and $20-$500 cash to the retail location’s cashier.
5. Your funds will be added to your RockItCoin wallet, automatically completing your Bitcoin purchase within 60 minutes.

Tips for Secure Bitcoin Storage

If you’re looking to get started with Bitcoin, you’ll need a wallet to store it in. There are three main types of Bitcoin wallets: Software, Hardware, and Paper wallets.

Software, Hardware, and Paper Wallets

• Software Wallets: These are applications you can download on your computer or smartphone. While convenient, they can be vulnerable to hacking. Always enable two-factor authentication and use strong passwords. A great option to consider is the RockItCoin app, which offers enhanced security features for your crypto transactions and an easy-to-use interface.
• Hardware Wallets: These are physical devices that store your Bitcoin offline, making them immune to online attacks. Popular hardware wallets include Ledger and Trezor.
• Paper Wallets: These are physical pieces of paper with your private and public keys printed on them. They are highly secure if stored properly but can be easily damaged or lost.

Don’t know which wallet is best for you? We’ve got a guide just for that. Read “Your Ultimate Guide to Choosing the Best Bitcoin Wallet (for Beginners)” to learn more!

Conclusion

Understanding and buying Bitcoin doesn’t have to be daunting. With the right knowledge and tools, you can confidently enter the world of cryptocurrency. Whether you choose to buy Bitcoin at a RockItCoin ATM, online, or through a retailer, remember to prioritize security and stay informed. For more insights and tips, explore the RockItCoin Blog or visit a RockItCoin ATM. Start your Bitcoin journey today by downloading the RockItCoin mobile app or finding a RockItCoin Bitcoin ATM near you!