1. What is Crypto Money?
In order to understand the concept of crypto money, we first need to know what cryptography is. Cryptography; is the whole of mathematical methods working to provide information security concepts such as privacy, authentication, integrity. These methods are intended to protect information, both active and passive, that may be encountered during the transmission of information, as well as the sender and recipient of the information along with the information. In other words, cryptography is also referred to as all of the techniques used to convert information in a readable state into something that can not be read by unwanted parties.
With the development of cryptography, the security of information transferred on the internet has also started to increase. These developments have enabled crypto-money to emerge as a software. The first “Bitcoin” is the most popular of these logic-driven crypto paradigms and crypto money.
Crypto money, unlike real money, is not a value held in a leather wallet. As it develops with a decentralized system, no state or private entity has the right to speak of the production of these money. All the money we use in the classical sense are the objects that are produced by the states and are “a certain value” because it is the state support behind it. However, the newly developed crypto-money technology is produced by individual users everywhere in the world, without any government support, and has achieved “a certain value”.
2. What is Bitcoin?
Bitcoin is thought to have been developed in 2008 by a group or person named Satoshi Nakamoto’s nickname. In January 2009, the first block (Genesis block) was created and mining and transfers started. With Bitcoin, direct transfer to person (P2P) can be done and no vehicle is needed. It is difficult to detect the sender and receiver in transits. If necessary security measures are taken, nobody except you can control or seize your accounts and all accounts are stored in digital wallets.
In short, it is a completely free virtual currency. This system takes out the money required by nature to a certain extent and makes it a vehicle. In this regard, Bitcoin is a new experimental technology that has tried to ignore the existing financial system but has failed!
Bitcoin in summary;
It is a digital currency and has no physical / physical counterpart.
Bitcoin is a network interaction, does not have a center, and allows digital money transfer from person A to person B.
Transfer from any Internet point can be made.
No mediator or broker.
Bitcoin is written in open source, and everyone is open, everybody who uses it is the owner of the system.
It is used in all countries and personal account can not be intervened.
There are no limitations, such as conditions of use, preliminary contracts or terms.
Bitcoin is produced by a free program called miner.
Bitcoin to be produced is limited, totaling 21 million pieces.
To control the production rate, the “difficulty level” that determines the bitcoin removal rate is continuously adjusted within the framework of certain protocols. Difficulty is determined by the density of production on the network.
Every user has a digital wallet and an account.
Your Bitcoin transfers are signed with a unique signature, which in turn is checked by miners for correctness and uniqueness. Thus the same bitcoin can not be used a second time and duplicate payment is blocked.
With Bitcoin, you will not pay any extra to sell your product. No prerequisites are required from you.
Bitcoin; It can be converted into many currencies like USD and EURO.
3. What are the advantages of using bitcoin?
Bitcoin is a peer-to-peer digital payment system and is the first and unique because it has many features. There are many advantages over traditional payment systems such as bank transfer, EFT or credit card:
There is no time limit. There is no time limit for the person who wants to carry out the bitcoin transfer, transfer can be made from any point on the internet via online wallets.
There is no room limit. Traditional systems go to banks or ATMs to send or receive wire transfers (except for sending over the internet). For example, in transfer systems such as postal delivery and Western Union, the person must be transferred to such centers more and more. Bitcoin transfer is to perform; there is no need for someone to physically go there and be there.
Transfers are very fast. It responds to natural human weaknesses like impatience, money transfers are very fast.
It’s very easy to hide and move. With a virtual wallet where you can download thousands of dollars worth Bitcoin to your smartphone, you can carry it with you at any time.
All regions of the world can operate. Thus, exchange (currency exchange) costs made with foreign currencies do not apply.
It costs like the printed money and costs no. The money printed by the traditional method; In many respects, such as transportation, warehousing and security expenditures, the government is creating cost and expense. In Bitcoin, besides these costs, there are no obstacles such as bureaucracy.
It is not affected by the economic or sociopolitical situation of the countries. It is not subject to the interference or pressure of the central bank of any country; for this reason they are not affected by economic or socio-political ups and downs of the countries.
Payments do not have any lower limit. At Bitcoin, even very small amounts of micropayments can be made, which can not be done with payment systems such as credit cards or wire transfers.
No fees or commissions apply. In Bitcoin, transfers occur between networks, directly from one address to another, without a central authority. For this reason, there are no fees or commissions on transfers made in the traditional way.
Removes the transaction costs associated with payments for companies. For companies that make e-commerce and therefore pay by credit card, there are many charges such as authorization, commission, security, transaction and account fees imposed by banks.
4. What is Altcoin?
With the increasing interest in Bitcoin, the cost and difficulty of extracting Bitcoin has increased, and special equipment for the mining business has begun to be produced. Increasing levels of difficulty, high cost and cryptanalytic interest have led to the emergence of bitcoin derivatives. In this sense, the crypto paralara is different from Bitcoin, which has a different algorithm structure, called “subcoin”. So it’s a kind of Bitcoin-like / derivative coded currencies. As of the beginning of 2015 there are more than 600 subcoins and they are very interested in Bitcoin exchange sites. The most preferred subcoin algorithms are as follows;
The Sha-256 encryption type is the encryption algorithm that Bitcoin uses. Litecoin, which is considered as the second largest crypto currency, has the most interest in the agenda and uses the Scrypt encryption algorithm. The Kecak algorithm is well known and used by Maxcoin. Maxcoin has been fixated on the agenda as a highly profitable coin with advanced and graphics card-based mining programs for CPU-based systems. Ipo-type coded coins that are famous for Ripple coin earn you based on the rate of Shares you send.
5. Why Produce Altcoin?
The first reason is that the level of difficulty, which is the most important issue for mining, is low in altcoins. A altcoin with a difficulty of 1 can be produced much faster and profitable. However, as Bitcoin and Litecoin currencies have been dug up at a very high level, new “clone coins”, altcoin, are produced at lower levels. It values in exchange sites according to supply / demand ratio. You can produce low coin coins according to this value and you can convert them to Bitcoin type according to the current order. However, you can not find any kind of coin in exchange sites. The reason for this is related to the fact that the market share of altcoins in general terms has not yet reached sufficient saturation and the required demand limit has not yet been exceeded.
6. Why Altcoins Preferred?
Altcoins should definitely be preferred. However, there are a few points to note. Each altcoin may not be added to the exchange sites. Altcoins that will appeal to the user in a short time and appeal to the user should be preferred. In relation to this, new altcoins have begun to try various ways to attract the attention of miners and investors. With each increase in competition, each altcoin that is driven into the market either tries to support itself with a game, or departs with the promise of supporting a major social vision and action. Before entering this market, it is necessary to conduct very serious investigations and understand the risks in general. After all, there is a truth that should not be forgotten at every step. The world of bitcoin and altcoin is an experimental project together with all instruments and their risks are very high.
7. What is Bitcoin Mining?
One of the key points of what makes Bitcoin so important technology and a big breakthrough is the concept known as Proof-of-Work. In fact, removing bitcoin, that is, mining a bitch to get a bitcoin is not the only goal of mining. Bitcoin miners also keep a decentralized account book, one of the features called Blockchain, which also makes Bitcoin Bitcoin. To summarize bitcoin mining, it is important to find out a number that is characteristic of your computer, and what makes this number important is that it is very difficult to find and it becomes increasingly difficult to find. Luck is not the reason why it is difficult and difficult. That’s why the Bitcoin protocol was designed by Satoshi Nakamoto as a security measure. This security measure exists so that anyone can do “Bitcoin pressing” and / or manipulate the Blockchain according to his / her head. In other words, what is called mining is a chance game you play with your computer, or, as written above, a number of digits in a stack of chunks of numbers. Here, each search hammer you make is directly proportional to your processor power. In this case, the more processor power you put into it, the more likely you will find a needle in the hay stack.
In the meantime, the concept will help you imagine that the digital stack of hay is huge and the needle is small. And it is not possible to “start looking at a corner of the haystack”, and in similar ways, use optimization methods to shorten your process / increase your chances. This is a bit of a bad example, but think that the needle is constantly and randomly displaced.
In the current situation (at the level of difficulty and award that the Bitcoin protocol sets for today), the miner who finds this pin (that is, “winner of the draw”) wins 25 Bitcoin prizes. This figure was 50 in the early days of Bitcoin, and it will go down. As a result, mining is challenging and requires a lot of CPU power, increasingly challenging, and reducing the amount of rewards.
Apart from that, personally, if you take any mining equipment and enter the BTC mining event, 99% will likely result in a financial damages infusion. But that does not mean that the same thing applies to all coins. You can choose other coins for mining.
8. What is the History of Bitcoin Mining?
Bitcoin mining has been constantly challenging since the first day and this difficulty continues to increase. For this reason, the number of people all over the world who are going to go, is starting to put more and more processor power into this business. The system automatically adjusts the level of difficulty in order to slow down the expulsion of a large number of Bitcoins in a short time to the market and to maintain a speed of 1 block per 10 minutes.
CPU Mining; the CPU of the computer being used, that is to obtain the Bitcoin by taking advantage of the power of the central processing unit of the computer. In the first days of Bitcoin, it is possible to mining with any computer; (it is still possible, of course, but it is not financially profitable, because the cost it generates is much more than its income), but at the moment it can not be done because of the difficulty. But CPU mining has played a role in other factors in the end of the devolution.
GPU Mining; graphics cards solve the mathematical problems that are required for mining Bitcoin (and some other coins), and are more efficient than processors (CPUs). This is why graphics processing units (GPUs) must be more efficient in floating point calculations, and the processes required to extract bitcoins must use these calculations extensively. To explain this, that is why the GPUs are more effective in the mining process than the CPUs; “If GPUs are strong and fast mine workers, CPUs are more qualified, white-collar workers. CPUs are perhaps more educated and knowledgeable, but GPUs for mining are much more effective. ” In short; After the widespread spread of the knowledge that GPUs, or graphics cards, work much faster and more efficiently in such processes, this is roughly equivalent to days when the efficiency of the CPU mining (due to the increased Bitcoin difficulty) has been diminishing. People have seen massive GPU mining rigs special computers for mining). GPU minerals have been experiencing golden days, with many of these graphics cards being connected to a computer and / or created with a pool of GPU power from many computers. We can say that this process lasted from late 2010 to early 2013 very profitably. Nowadays, Bitcoin mining is now the only level of difficulty that ASICs can achieve profitability.
ASIC Mining; If the ASIC miner nesting question is freaking out, we can go out of the mining worker example above to say something about an ASIC miner device; From the day of its birth, only the mining of mining, or even just the mining of a special material (coin) has been cultivated, consider a specialized worker in this direction. Application-specific integrated circuits (ASICs) can be thought of as specially manufactured processors only for tasks that are expected to be fulfilled and are performing both faster and more efficiently than all other processor types and energy consumption).
ASIC devices specially designed for bitcoin mining have begun to meet users since the beginning of 2013 (from April to May), and Bitcoin mining has changed irreversibly. If the GPU mining is faster and more advantageous than CPU mining, we can say the same thing for the difference between ASIC and GPU. As a result, the GPU and CPU minerals have become useless and the cycle of ASIC devices has become overcurrent. The disadvantage of ASIC devices is that specific COINs can not be used for a job other than mining.
9. What is Mining in the Future?
For now it seems that ASIC manufacturers’ speed battles will continue for a while. The producers announce their new products every 3-5 months and get the pre-orders and deliver the products to the customers after the month. It has always been a matter of curiosity for the users who started to use Bitcoin because the companies producing and selling equipment related to Bitcoin mining did not produce Bitcoin with these equipments but also sold the machines. For this reason, production costs, ie electricity and space costs, are often expressed. Looks like things will change now.
For example, the Swedish-based Bitcoin mining equipment maker KnCMiner announced that by 2014 it would stop selling equipment and make its own mining machinery. The biggest reason for KnCminer’s decision to be taken as profitability. In other words, for this company, selling a machine is less profitable than doing Bitcoin mining with that machine. Calculations show that Bitcoin, which will be produced within the next few years, will be worth about $ 2 billion, with only about 1,310,400 Bitcoins going into the market in the next year, almost $ 500 million worth of equipment her appetite is getting bloated.
This situation may not always be the same for every company; because the cost of production, that is, the cost of electricity and space, varies between countries. For this reason, KnCMiner, who is currently mining in a helicopter hangar in Boden, Sweden, is heading to Iceland, where his electricity costs are much lower by expanding production sites.
As is known, Iceland is very rich in natural thermal resources and electricity is generated at a very low cost from these sources. Electricity costs for homes and businesses are almost free, and so much electricity is generated that the country can use it, which is driving Iceland to search for new markets like Europe. But Bitcoin miners are not immediately anxious; because the electricity for the big producers in Europe, America and China, and therefore the cost of production is still high, and therefore the device sales have to continue.
10. What is Cloud Mining System?
Cloud mining can be briefly described as leasing a user’s mining package through a company’s data center anywhere in the world. In cloud mining, the client receives a daily, weekly or monthly payment in the direction of a processor power lease and generated crypto money for a certain price; but it is a well-known fact that the negativities raised about cloud mining in general are too much. It may or may not be obvious that some companies are actually manufacturing, and it is important to pay attention to this issue.
The cloud mining process briefly begins with a user who wants to make a cloud mining purchase of a processor power pack or mining feel from the mining company. After the purchase, after the hourly, daily or weekly amount is distributed according to the shares, repayments are made to the investors. Some companies may charge maintenance and repair fees per share, so before investing in a cloud mining company, it is necessary to conduct an in-depth review of interruptions and commissions. Click here to learn more about cloud mining systems.
11. How can I use Bitcoin?
Bitcoin and crypto money have many uses. If you have some Bitcoin in your hands, you can trade your crypt money as an investment tool by trading in exchange sites. Another area of use is shopping. You can buy something on the Internet or at storefronts for Bitcoin. The function of sending money is the function of the most populous and cryptographical output areas of use. In other words, you can easily transfer international money to the desired person by getting rid of the high commission or sending fees received by banks and intermediary institutions. In addition to these areas we are talking about, Bitchin’s infrastructure, blockchain, is also planned to be used in other areas outside finance. In this framework, blockchain technology can create applications that create added value and facilitate life in other areas such as health, culture, science and art.
12. How to Buy / Sell in Bitcoin Stock Exchange?
Bitcoin and other cryptographic software are widely used as investment tools besides the above mentioned usage areas. Crypto money can be thought of as the same gold, sold when the price drops when it falls, and it is possible to earn money after these transactions. Most users interested in bitcoin and altcoins try to make money by buying and selling in stock markets open 24 hours a day, 7 days a week.
In order to trade on the stock exchanges, you first need to join to an exchange site (Bitcoin or AltCoin stock exchange). If you have crypto money at your disposal, you can start transferring your account in this account. If you have just started a crypto paralysis and you do not have Bitcoin or any altcoin at your disposal, you can exchange this money for crypto money by sending money (Dollar or Euro) to the exchange site and then receiving a purchase order within the site. In the exchange process, the site does not sell or receive crypto money in any way, the swapping is done only between the users. In other words, let’s say you have a bit of Bitcoin in your hand and you want to sell it and convert it to USD, you have to give a sales order by entering the amount of Bitcoin you want to sell and the selling price. Once you have done this, another user must issue a purchase order in order for the sale to take place, corresponding to your sales emre. The transaction takes place whenever the buy and sell prices within the site match, that is, the same value. In exchange for this, the exchange site receives a commission from the buyer and the seller. So the main purpose of the exchange site is to provide safe trading by combining the buyer and the seller on the same platform.
Users who sell and sell crypto money are aiming to make profits by performing these transactions on a short or long term basis. For new users, it is not recommended to buy and sell, it is very important to understand the world of bitcoin and cryptos first and know the market well. You can learn more about Binance and Kucoin exchanges.