Trezor: The original hardware wallets

What is Bitcoin

Bitcoin (short: BTC) has been the worlds first crypto currency. All subsequent crypto currencies are referred to as Altcoins (alternative coins). Bitcoin is both a currency and a means of payment. In contrast to fiat money, e.g. the Euro or the US Dollar, there is no central bank that prints the money and regulates the cash flow. At first glance it seems absurd that something intangible, a digital currency, should have a value. However, there is a logical answer to how Bitcoin gets its value. To understand this, it is necessary to understand how the Euro or US Dollar maintains its value. Both currencies are based on an illusion, a mental construction, that a coin or banknote has a value of 1, 2 or even 50 (Euro or USD).

According to Modern Monetary Theory, this value is based solely on the fact that a government determines these values and the government calculates its claims (e.g. taxes and other levies) in this currency. In history, paper money did not acquire any real value until it was linked to gold. However, the Bretton Woods treaty, which made the US Dollar the worlds reserve currency and obliged the USA to hold an ounce of fine gold for 35 Dollars, was cancelled by US President Nixon in 1971. The value of money was thus placed on trust in governments. Money became an instrument of economic policy.

The exchange rates became free, the value relative. Governments and central banks have started printing unimaginable amounts of money to finance crises. Since 1971, the price of gold has risen to well over USD 1,000. Paper money has thus lost almost 97 percent of its value compared to gold. Liberal economists therefore doubt that fiat currencies can fulfil a core function of money, that of a store of value. This is where Bitcoin comes in. Bitcoin is mined similar to gold. However, the number of Bitoin is limited to 21 million BTC, so there can be no inflation. Bitcoin is therefore a perfect value memory.

What is a Bitcoin Wallet

A Bitcoin wallet is a software program in which Bitcoins are stored. Technically, Bitcoins are not stored anywhere. For every individual who has a balance in a Bitcoin wallet, there is a private key (secret number) corresponding to the Bitcoin address of that wallet. Bitcoin wallets facilitate the sending and receiving of Bitcoins and give ownership of the Bitcoin balance to the user. The Bitcoin wallet comes in many forms. The four main types are desktop, mobile, web, and hardware like Ledger or Trezor

Keeping your Bitcoin wallet safe is essential as Bitcoin wallets are high-value targets for hackers. Some safeguards include encrypting the wallet with a strong password and choosing a cold storage option; that is, storing Bitcoins offline. It is also advisable to frequently back up your desktop and mobile wallets as problems with the wallet software on your computer or mobile device could erase your holdings.

What is a Bitcoin Faucet

A Bitcoin faucet is a website or app that rewards users with Satoshis for completing small tasks. What is a satoshi? It is the minimum unit of Bitcoin, exactly 0.00000001 BTC. There are multiple reasons why a certain website might want a user to complete a captcha but the main three reasons are: to get traffic to their website, to make money by introducing other content via the website and to simply introduce users to the crypto market. Keep in mind that faucets are not a get-rich-quick scheme, as the reward amounts are typically quite small and fluctuate depending on the value of cryptocurrency at any given time. Because of this, many users who take part in crypto generators allow their total earnings to build up over time until they have a large enough payment to send to their wallet. Before you start earning Bitcoin please check out the Crypto Faucet Blacklist first!

What is Cryptocurrency

Simply stated, a cryptocurrency is a new form of digital money. You can transfer your traditional, non-cryptocurrency money like the U.S. dollar digitally, but thats not quite the same as how cryptocurrencies work. When cryptocurrencies become mainstream, you may be able to use them to pay for stuff electronically, just like you do with traditional currencies.

What is Bitcoin Cloud Mining

Cloud mining is a mechanism to mine a cryptocurrency, such as bitcoin, using rented cloud computing power and without having to install and directly run the hardware and related software. Cloud mining firms allow people to open an account and remotely participate in the process of cryptocurrency mining for a basic cost, makes mining accessible to a wider number of people across the world. Since this form of mining is done via cloud, it reduces issues such as maintenance of equipment or direct energy costs. Cloud miners become participants in a mining pool, where users purchase a certain amount of "hash power." Each participant earns a pro-rata share of the profits in proportion to the amount of hashing power rented.

What are trading pairs

In cryptocurrency, trading pairs or cryptocurrency pairs are assets that can be traded for each other on an exchange, for example Bitcoin/Litecoin (BTC/LTC) and Ethereum/Bitcoin Cash (ETH/BCH). Trading pairs lets you compare costs between different cryptocurrencies. Cryptocurrency pairs allow you to compare costs between different cryptocurrencies. These pairings help illustrate the relative worth of coins, for example, how much Bitcoin (BTC) equals in Ethereum (ETH) and how much ETH equals in Bitcoin Cash (BCH).

Exchanges usually offer several pairing options, giving you the chance to choose a pairing based on currencies you already possess. For example, if you own BTC, then you have the opportunity to trade with any pairing listed on an exchange that includes BTC. Some crypto exchanges do not offer pairings for cryptocurrencies and fiat currencies like the U.S. dollar (USD), but exchanges like Gemini, Coinbase, Binance, and Kraken do offer fiat trading pairs. As they have the most exchange options, the most versatile cryptocurrency pairs to trade are usually BTC and ETH.

Bitcoin vs Bitcoin Cash

The original Bitcoin network has undergone many upgrades and alterations throughout its 12 years of existence, which has resulted in several offspring chains, all but one imposters according to Bitcoin maximalists, thriving in the crypto ecosystem. Where Bitcoin is now universally considered to be rather a store of value than a payment network due to its slow transaction speed limitations, Bitcoin Cash positions itself as a digital currency for everyday use, thanks to its larger block size. Bitcoin forks are clones of the original BTC-powered blockchain that are created when the decentralized network has to go through a hard fork due to community disagreement. This results in a new division where the original blockchain and its new altered version carry on in different directions, each taking their supporters and miners with them. Note that a fork can end up having entirely different features from its parent chain, depending on the reason behind the hard split and the protocol changes implemented.

What is an exchange

Cryptocurrency exchanges are online platforms where one type of digital asset can be traded for another based on the market value of the assets provided. At the moment, the most common exchanges are Binance and Coinbase. It is necessary not to mistake the cryptocurrency exchanges for wallets or wallet brokerages in cryptocurrency. Cryptocurrency wallets and wallet brokerages usually allow you to purchase and sell a limited range of common digital assets (Bitcoin and Ethereum). You can then transfer to another exchange to trade for other digital assets such as altcoins. Most cryptocurrency exchanges typically restrict their users to merely exchanging digital assets for digital assets, but a few allow fiat currency exchanging

Traditional Cryptocurrency exchanges are markets close to conventional stock exchanges where buyers and sellers transact based on the current market price of cryptocurrencies (with the intermediary exchange). Typically these kinds of trading platforms charge a fee for each transaction. Third parties run off exchanges (they have a middle man who can help and fix any problems) and Decentralized Exchanges or DEXs that resemble conventional exchanges such as IDEX. It will require a lot of data in typically centralized markets but often allow fiat trading. DEX markets will not allow fiat trading but require fewer details.

Cryptocurrency Brokers are website-based exchanges, which are like an airport currency exchange. They allow clients to purchase and sell cryptocurrencies at a price set by the broker (usually at the market price plus a small premium). The transaction here is between buyer or seller and broker, not between buyer and seller. Coinbase is an example of such an exchange type, and so is the Cash App. Shapeshift also offers a similar service (it allows you to swap for another on the token type). For new users, this is the easiest approach. Despite the ease of use and the effort the broker puts in, you can usually pay slightly higher rates than you do on the exchanges.

Online Trading Platforms enable direct peer-to-peer exchange between buyers and sellers. Such type of direct trading platforms doesn’t use a fixed market price. Sellers set their exchange rates, and buyers either locate sellers through the website or designate the prices they are willing to buy for, and the website matches buyers and vendors. There are exchanges of this sort that deal with exceptionally large buyers and sellers and the typical buyer or seller; the second category is likely to be found. Many Decentralized Exchanges are of this sort (although some are similar to conventional exchanges, so they are classified in the first category). In certain regions, this form of exchange may be the only solution. Make sure you search the Coinmarketcap market rates as you don’t buy/sell at a set market price! F See LocalBitcoins.com for an example of a centralized peer-to-peer network that enables the fiat and crypto network.

Cryptocurrency Funds are pools of professionally managed cryptocurrency assets that allow public purchasing and keeping cryptocurrency through the fund. GBTC is one such fund. You can invest in cryptocurrency using a fund without having to buy or store it directly. You can’t use crypto in a fund as money as a trade-off; these are for investment purposes only.

Understanding Blockchain

Cryptocurrencies are created using advanced mathematics and science elements, in a process known as cryptography. That can make it daunting and frustrating when you first start dipping your toes into cryptos. The technology behind cryptocurrencies can be complicated, but it can be very straightforward to use them and understand the fundamentals of how they operate if you use tools such as our guide in the time to do so. Decentralized blockchains are what powers most cryptocurrencies and enable them to operate effectively. The blockchain is simply a public ledger that records all transactions that have ever been made on the network of a cryptocurrency. The precise details and information of each transaction are encrypted on most blockchains. This makes pseudonymous digital transactions, or in some cases, entirely anonymous. Both cryptocurrencies-like Bitcoin-will does not work without the blockchain.

In the 90s, “smart contracts” were first conceptualized but are still a fairly recent advancement of blockchain technology. They did not even get to the forefront of the crypto world until Vitalik Buterin launched the Ethereum platform in 2015. Smart contracts are slowly but steadily finding their way into the mainstream finance and business world today. There are many benefits of using cryptocurrencies smart contracts, including the ability to conduct digital transactions between two or more parties autonomously. Ethereum is the most common cryptocurrency supporting smart contracts, and new tokens are being built up all the time on its platform. Some cryptocurrencies also have their smart contract apps, so when you are interested in the crypto business, knowing the inner workings of smart contracts and how they operate will do you good.

What are NFTs

An NFT is a collectible digital asset, which holds value as a form of cryptocurrency and as a form of art or culture. Much like art is seen as a value-holding investment, now so are NFTs. But how? First, let's break down the term. NFT stands for non-fungible token - a digital token that's a type of cryptocurrency, much like Bitcoin or Ethereum. But unlike a standard coin in the Bitcoin blockchain, an NFT is unique and can't be exchanged like-for-like (hence, non-fungible). So what makes an NFT more special than a run-of-the-mill crypto coin? The file stores extra information, which elevates it above pure currency and brings it into the realm of, well, anything, really. The types of NFTs are super-varied, but they could take the form of a piece of digital art or a music file - anything unique that could be stored digitally and be thought of to hold value. Essentially, they are like any other physical collector's item, but instead of receiving an oil painting on canvas to hang on your wall, for example, you get a JPG file.

NFTs are part of the Ethereum blockchain so they are individual tokens with extra information stored in them. That extra information is the important part, which allows them to take the form of art, music, video (and so on), in the form of JPGS, MP3s, videos, GIFs and more. Because they hold value, they can be bought and sold just like other types of art - and, like with physical art, the value is largely set by the market and by demand. That's not to say there's only one digital version of an NFT art available on the marketplace, though. In much the same way as art prints of an original are made, used, bought and sold, copies of an NFT are still valid parts of the blockchain - but they will not hold the same value as the original.

 

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