Topic: Three basic fact you would love to know about bitcoin (Read 347 times)

I have heard of these facts almost 5 times. Still not bad but come up with new ideas next time.

You are right @ OP, Bitcoin is the foundation in the crytop
space industry which has globally been adopted for its purpose of inventions with the primary aim of the P2P alternative source of transactions otherwise posses for digital assets of making incomes.
It is agreed that yeah, despite the high level of bitcoins speculations and popularities, some individuals are yet to  accept the fact about the potentials of the Coin because they are either ignorance to learning or they haven't been in opportuned to be thought of it.
Although it is crystal clear that there are existences of countries whom are against the inventory due to their sentiments that grosses between them and the US dollars so, there is said to be a biased generosity of such countries accepting the adoptations of the Bitcoin at which it is pronounced an illegal technology to their world.
This has also filmed certain bridges towards the circulatory capacities of Bitcoin and of course supposed to serve an hint of its awareness on a wider spreader to individual acknowledgement about Bitcoin.

The enjoyment in Bitcoin is  being aware of it's existence, an audible acknowledgement to engage on it, learning about the basic skills and its potentialities and more say, be part of its beneficials.

El Salvador was the first country that adopted Bitcoin some years ago, and Bitcoin has done so many favourable things in their country that is making people to guess that in five years time El Salvador country will be among the developed countries of the world based on some kind of investors and investment in the country. In El Salvador country, you can purchase goods and services with Bitcoin and nobody will arrest you like the way they used to arrest those that use Bitcoin in their country that is not legal tender. The reason many countries fall in love with decentralized currency call Bitcoin, because it is secure and safe in both international and local transaction which are part of some of the things that is making potential leaders in the world to adopt it for their citizens to have access like other countries that adopted it in the past.

Coins are not created by the miners, but they mine the blocks that have transactions in them made by the users of the blockchain, the miners then get rewarded with coins by the chain and that is how new coins come into circulation. So, coins are already created and are inside the blockchain, but they are unlocked by the miners by mining new blocks and receiving Bitcoins by the blockchain, that's how the whole ecosystem works.

Well, you are right about online and offline wallets, but online wallets doesn't have to be an exchange but there are dedicated services where you can just create wallets to store your Bitcoins. Blockchain.com provides the safest one in my opinion, however, it is not recommended to keep your funds in online wallets because they are vulnerable to attacks.

I really enjoyed your content but I think you need to work hard more on how you would position your write-up. All these things you have mentioned, it is something that we all know and it's never new to even the newbies. I really appreciate your effort as a newbie to have put all these information together. Bitcoin is a digital coin and it had been in existence for long now. Wallet is a digital store where we can always keep our coins whether Bitcoin or altcoins. It is like a bank where we keep money for safety and withdraw it anytime we are interested to use it.

I don't think I ever read this kind of statement anywhere. Anybody who is a minimum serious about bitcoin (and cryptocurrencies in general) perfectly knows that we still have a very long way to go, the adoption is still pretty low but there is a steady increase, so for sure we are on the right path. And the average bitcoiner is pretty patient, so I don't see problems with that.

The advantages of cryptocurrencies include cheaper and faster money transfers and decentralized systems that do not collapse at a single point of failure.Fiat currencies derive their authority from the government or monetary authorities. For example, each dollar bill is backstopped by the U. S. government.

But cryptocurrencies are not backed by any public or private entities in as much as bitcoin impact is of greater value El Salvador is the only country to accept Bitcoin as legal tender for monetary transactions as of August 2023.
Cryptocurrencies were invented or introduced with the aim to revolutionize or rehabilitate the financial system but its now in two ways.It can be the acceptance and adoption and its practical implementation and utilization.

Bitcoin is not created by miners but is mined by miners, the same thing as gold, which is not created by gold miners, but the gold already exists.  So to process Bitcoin transactions, validation is needed from a device, Bitcoin miners are tasked with processing these transactions and for every successful transaction the miner gets Bitcoin, so they never create Bitcoin.

That's right, almost 99% of fiat currencies around the world have BTC pairs ^{(poor countries, developing countries or developed countries)}, Bitcoin has become part of the world economy now so everyone around the world is free to transact with Bitcoin using the pair their own country's fiat currency.

Yes, this is basic knowledge about how to store Bitcoin safely and to avoid hacking, so far there are various kinds of Bitcoin wallets available, such as Bluewallet, Electrum, and so on, just adjust it to your needs, many also recommend holding large amounts in the long term, using a paper wallet is a wise choice.

4) It is a very important fact that more people should know that BTC price is not random over the long term but it is PREDICTABLE.

It should be known as the BTC Scaling Law or  Fair Value Price=10^-17 * (days from Genesis Block)^5.82. This formula gives the "true" value of BTC and it can be used to predict future values and if the market value of BTC is above or below its "fair" value.

It is also fundamental to understand this is not ANOTHER model for the price of BTC but a fundamental characteristic of BTC itself. Power Laws are very important in nature and man-made phenomena, like river formation, mountain growth, metabolism rates in animals, brain size vs body size, GPD vs population, and so on. See here this talk to understand the relevance and importance of Power Laws:

https://www.youtube.com/watch?v=XyCY6mjWOPc

As I understand it, a bitcoin ETF means that bitcoin is considered a security, so that does not pave the way for bitcoin to be used as a currency or means of payment in stores, companies, etc. The SEC approves bitcoin spot ETFs, meaning bitcoin is recognized as a tradable asset and its chances of becoming a currency are even more remote with this decision. Furthermore, given bitcoin's transaction fees, I actually think it is not suitable as a means of payment , it is more suitable as an asset.

Bitcoin becomes an asset for people who make it an asset in investing.
People who invest in Bitcoin are called Bitcoin investors so their investment assets are Bitcoin.
Bitcoin is used by Bitcoin investors as an investment asset because Bitcoin is able to act as a hedging asset against fiat currencies which experience a decline in value.

Bitcoin is basically, as stated in the whitepaper, a peer-to-peer electronic cash system which functions for ease of transactions without involving certain parties or does not involve financial institutions like the fiat bank transaction system.

You should explain the meaning of your statement which says Bitcoin is not an asset, Bitcoin is a hedge in order to provide a good understanding to readers who don't understand Bitcoin, not just write about it.

Bitcoin is remarkable. Combining security and supply generation with "mining" to validate transactions and create new coins is amazing. A self-sustaining ecosystem!

Your emphasis on online exchanges and offline hard drives for Bitcoin storage is vital for new users. It shows Bitcoin's accessibility and security, responding to user preferences and risk tolerances.

Bitcoin is Bitcoin's acceptance depends on educating people about its benefits and features. It represents a decentralized financial future, not just a money.

and also now that Bitcoin spot ETF have been approved  then we may expect more added chances of adoptions from each
country and with this not just Mobile load but will also merchant from here and there will accept bitcoin.

https://www.reuters.com/technology/bitcoin-etf-hopefuls-still-expect-sec-approval-despite-social-media-hack-2024-01-10/

now that it is all over the news so I assume that longer we have to expect best result ?

I wanted even 7/11 companies will finally accept bitcoin and of course Gas Stations all the fact given are valid but
the longer effect is what we need to wait about this approval .

The only reason someone would care about fees is if they are actively moving bitcoin around. "long timers" presumably means people who generally hold long term, so aren't even having to deal with fees, unless they DCA regularly but then they can just send their bitcoin off exchange to a wallet every once in a while.

Also it's not like fees have been relentlessly high haha. I feel like people have complained about the fees nonstop since like January of last year, but the vast majority of the time fees have been under $5, as they currently are. If someone has bought say a few thousand, or even a few hundred, dollars of bitcoin and is moving it off an exchange for long term holding, they don't really care about a $3 or $4 tx fee, and if its one of those odd times when the fees are temporarily $20 they can just wait a few days or a week or two if the fees are bad for an unusually long time.

Fees are only really a problem for people who are moving a very small amount of money around, like for perhaps people in poor countries (or just low income people in general who barely have any extra money) who are just saving in Bitcoin maybe a few dollars or a few dozen dollars at a time, or for that small number of people who actually spend their bitcoin. And even then its only a problem if they urgently need to move their bitcoin and can't wait for cheaper fees. Yes it absolutely can be a problem for some people, but people overexaggerate the issue considering that the vast majority of people in Bitcoin are only going to rarely even be making a transaction and if the fees happen to be high for a few days they can usually wait fees to get back to the normal $2-$4.

Only time fees in crypto have ever bothered me (a "long timer", passed 10 years in the space a couple months ago) was on Ethereum back in 2021 when I was doing a few DEX swaps between ETH and tokens and it usually cost $100+ each time. Now THAT was annoying haha. Bitcoin fees typically at like $3 and every once in a while at $20 for a few days ain't that bad for Bitcoin's current majority use case - long term savings/investment/store-of-value. Bitcoin spenders need to be using the LN anyway, and real low income bitcoiners yeah either need to use custodied services or only move their bitcoin into their own wallets every once in a while once they have enough to make paying a $3 fee worth it.

You do realize that a major exchange will allow deposits and withdrawals vi its LN wallet. KRAKEN does this as does nicehash.

So a simple kyc with a small cash deposit allows endless LN transfers cheaply.

I am thinking all this will be a boon for exchanges that offer LN wallet access.

Exactly, I think because of the recent high transaction fees, investors in crypto currency, especially bitcoin, choose to just store their bitcoin in a wallet and not in an exchange, especially if they will not do anything to it just to hold the assets. This is because they will avoid the high transaction fees. Instead of frequent transfers or sending of assets, they will choose to do it in one transaction so that the fees are worth it. I personally avoid the high transaction fees. That's why if I need to send an asset from one wallet to another, I'm waiting for the fees to get low, as we know the fees may change every day, so if I'm not in a hurry, then I will do the waiting game. I'm sure many investors are also doing this if the transaction is urgent, but if it is urgent, then it will be painful for the sender as he will be the one to shoulder the transaction fees.

Among the list, this is the fact that I am really amazed. Because of this, we solve the traditional problem we have in finance where having a third party to send or receive money or even having your own bank. With this, it makes Bitcoin decentralized, and no need to require any centralized third parties, especially the government.

@OP, The information you have shared in this thread is not new to many people on this forum.

As a matter of fact, it seems you are not aware of one very important Bitcoin rule, which states, "Not your key, not your coin." Telling us that we can store our coin on a centralized exchange like coin-based, which you mentioned, is not really a wise decision that a crypto enthusiast should adhere to. You did not mention the risk that is attached to this decision.

In the past, some exchanges have been hacked, and a few have also collapsed, which has caused some investors to lose their investment. It was really a hard lesson to learn and a warning that no crypto enthusiast should consider storing their assets on a CEX. The best place to store your coins is offline, in a self-custodial wallet. You can use an electerum wallet, exodus wallet, or a hard-wear wallet.

IMHO.

These tips and guides should do better about telling where to keep your Bitcoins for newbies. There are other wallets that you can mention and about the latter description, it's like a normal description as per computers users, of course you need a harddrive to keep your files, software etc.

Why don't you guys suggest some typical desktop wallets for desktop users and name the brands like Electrum, Samourai, Bluewallet, etc.

It is not that we cannot store Bitcoin in exchanges but it is not advisable to keep our Bitcoins on exchanges due to the given reason.  It is a fact that Bitcoin can be kept either on a custodial wallet or a non-custodial wallet but as I stated, there are underlying risk if we keep our Bitcoin on centralized exchanges just like what the earlier replies stated.


@OP stated the possible ways to store Bitcoin and not recommend people to store their cryptocurrency on exchanges.  It is more on giving information than advising or suggesting people on what to do.


There is nothing these "long-timers" can do if they are into trading.  They have to keep their trading coins to the exchanges but I am sure when their trades is done majority of them withdraw them to their own wallet.

The high fees is tiring, everyone are trying their best to avoid paying high fees for their transaction. But I don’t think old timers would risk storing their bitcoins in crypto exchanges for long term. We have too much experience in the crypto space to make such silly mistakes. I believe any coins that is moved to an exchange is going to be spent almost immediately.

They will learn their lessons quick once those 3rd party sites closed down for good and they have no way of recovering their coins.
It will be an expensive lesson if they continue to store their assets to other sites having no full control of what they have.
That, I guess, at some point this concept these newcomers will be oriented at. Not to store their coins to any 3rd party sites.
But I also do think, that even long timers here are still storing some of their stash inside crypto-exchanges especially now of the high fees involved.

Thank you all for the points and advices, I would immediately amend my work

Yeah, it's the first and what we call prime mover, and it's a bit controversial to say the least, as the founder and creator disappeared and so early adopters either become curious or just sold their Bitcoins because they don't believed at it anymore since Satoshi is gone.

It's not competing with gold, but they are being compared as Bitcoin is being called "digital gold".

And as the title suggest, it's basic facts and I think majority here is already familiar with what the OP has posted.

Fun fact I discovered several years ago talking to non-users (just people who bought to speculate er, I mean invest). Most owners have their coins stored on an exchange or even worse, on a site/broker/app. They see a digital wallet, but only in the same vein as any other digital wallet. They don't use a Bitcoin wallet, so don't deal with Bitcoin private keys or addresses, and don't interact with the network.

To demonstrate (Covid times maybe, don't recall when exactly), when PayPal offered Bitcoin buys, a lot of users "bought" Bitcoin with PayPal. So their wallet showed Bitcoin, priced in USD, and they could sell it at any time, but there was no way for them to actually withdraw that coin to their own wallet.

These aren't coins. These are just made-up numbers.

I don't know how it is now in 2024 but I wouldn't be surprised if most new investors don't actually even really buy actual coins.

Bitcoin has more value than other cryptocurrencies because it offers for value. It's decentralized and secure, two features you will not find on almost all altcoins.

Bitcoin is not competing with either dollar or gold.

Bitcoin is not an asset, bitcoin is a hedge.

Also, to gain mostly too, one has to trade BTC for quick profit and hold for long term if the value of it is to be benefited from in excess. That is one can be a millionaire from holding BTC for a duration of up to a decade.

BTC is also more stable and has more value than other cryptos, because it is the first among others and has a rather steadier market value of which competes with dollar and gold currently in the market of foreign exchange.

Miners don't create coins, they receive them as a reward for solving the puzzle. Also, nodes verify transactions, miners confirm them.

Never store your bitcoins online and never use an exchange for storage.

Till your post, I did not come to think of this knowledge as basic facts,  as I thought this was basic knowledge I mean, we use the term fact when we have to emphasize the importance of something but the information you have mentioned is so basic and obvious that you being a newbie posting it on the BTC discussion where everyone is talking about BTC specifically.

Don't you think everyone would be aware of these obvious facts, Although they are important and there is no doubt about that, but I suggest you to make posts that would be of help to us because this isn't going to help us or even the newbies in any way.

I did not mean to dishearten you but just trying to guide you that, you should come up with more technical and better posts, rather than starting from the very start, I hope you won't mind me.

The Bitcoin whitepaper is a must read for Bitcoin fans as a basic knowledge of Bitcoin. Everything is explained in sequence, including incentives.


In this part, I think there is a mistake in understanding it properly. I will give you a little understanding of how to store coins in a wallet.
Storing in wallets on exchanges is not recommended because exchanges are not wallets for storing Bitcoin assets.
Exchange as a place to buy and sell assets including Bitcoin.

Each wallet generates a seed phrase and this seed phrase is the most important for wallet users in terms of accessing the contents of the wallet.
If you use the exchange as a place to store Bitcoin, then that is where your mistake lies. Why, because the address obtained on the exchange does not produce a seed phrase.
The truth is that exchanges are not wallets.

Lol there are some lessons here:

1. You don't need to create redundant topics that have been mentioned/discussed a thousand times before inside and outside of Bitcointalk.
2. Double-check your facts before sharing them with the world.

Hmm, that's good, OP, but unfortunately, everyone here knows these Facts.

Nevertheless, I will elaborate on this little bit: we cannot store Bitcoin in Exchanges because now days all the top exchanges are centralized, Despite centralized exchanges, there is no trust that they will really keep your assets safe or not. Beside that, these exchanges can steal your funds, i.e., Bitcoin, by collapsing. The past is full of such cases where, when investors put their funds in exchanges to store them, the exchange took advantage of the opportunity, among which Mt-Gox is at the top. .
So, therefore, I believe that keeping funds or assets in exchange is inappropriate for users who have an investment in Bitcoin. So OP I didn't agree with you that storing Bitcoin in exchanges. Stored Bitcoin only in hardware wallets because only wallets give you the guarantee of your assets in terms of privacy. So guys, use your wit and don't keep your assets in exchanges instead of a hard wallet.

OP, this is not correct.

Bitcoin is simply stored in the blockchain, so it is stored on the network, not on a hard drive using specialized software or on an exchange. Only the bitcoin network (thousands of computers called nodes, decentralized around the world) stores bitcoin, no specific computer or exchange or device or whatever stores it.

The way you can ACCESS and transact with your bitcoin is through software called a wallet, specifically using your cryptographic keys. This wallet software could be various different things, including a company providing the service like an exchange, or a specialized hardware gadget, or software on your computer, but that is NOT how bitcoin is stored.

And storing of the actual cryptographic keys which allow you to access your bitcoin through wallet software (whichever kind you're using) is a different thing entirely and that could be stored through a service like an exchange, on a hardware wallet, on your computer, on a usb stick, on paper, in your head, on metal, on anything cuz it's literally just a string of characters so anything that you can write in/on (including 'writing' into your memory) can store your keys.

OP, I wanted to give you some Merit but I think your post is extremely generic and any body knows the information you share already.  There are likely at least a few hundred threads with the same information here.  This is the most common information about Bitcoin.

I suggest you make a more intriguing thread next to gather more attention and interest.

It’s important for newbies to know that you can’t get Bitcoins for free. Bitcoin mining is a very expensive process, and not many can afford it. A less expensive alternative for beginners who want to own bitcoins but do not have the money to buy would be to accept bitcoins as payment for services rendered.

It is bad practice to store bitcoins on exchanges. Always store your coins in a non custodial wallet like Electrum, Blue wallet or Unstoppable wallet. It’s recommended to buy an hardware wallet like trezor if you are hodling large amounts of bitcoins.
https://bitcointalksearch.org/topic/m.61293646

This two points you've raised are nothing than the exact explanation of a scenario of seeing someone using his strength and efforts to explain to the public that apple is a fruit, this is what even a little child can know or understand without having you go through loads of stress explaining.


We have either a custodial wallet or non custodial wallet to use for our bitcoin storage, however, we must understand this that our bitcoin aren't stored on these wallet, they are being stored on the blockchain, wallets only provides us the keys to unlocking them to have access to them.

Bitcoin blockchain is Proof of Work and its network runs by miners that solve computational puzzles to find new Bitcoin blocks and get block subsidy and confirm Bitcoin transactions to receive transaction fees from Bitcoin users.

How does mining work?

Exchanges have centralized exchanges and decentralized exchanges.

You can trade (buy, sell) bitcoins with fiat currency, stable coins and other altcoins.

In your bank account, you don't have physical money (fiat currency) but a digital number which does not mean anything if the bank bankrupted.

Wallets on centralized exchanges are custodial. It means exchanges own the private keys and own the coins, you don't own private key so you don't own your coins.

Use non custodial wallets and open source to use.
https://bitcoin.org/en/choose-your-wallet

Beginners: https://bitcoin.org/en/choose-your-wallet?step=5&platform=windows&user=beginner&important=control,fees&features=bech32
It recommends Electrum wallet.

Experienced: https://bitcoin.org/en/choose-your-wallet?step=5&platform=windows&user=experienced&important=control,fees&features=bech32
It recommends some wallets: Bitcoin Core, Bitcoin Knots, Electrum, Green, Sparrow, Specter

You don't need to write essay like this when you still need to learn a lot.

Newbies Stop Teaching When You Need To Learn.

Bitcoin was not designed to be exchanged using third parties like centralised exchanges but for P2P transactions. You can easily exchange your Bitcoin with another bitcoiner without any intermediary.

It is improper to store in centralised exchanges because they are not reliable. These platforms can easily be affected by hacks and negative government policies. The owners of these exchanges could also pull an exit scam or mismanage the business.

Bitcoin is mostly used by many people as an investment platform. They buy, hodl and sell when the price appreciates. Others mainly in developing nations use Bitcoin as a hedge against inflation.   

No doubt enthusiasts here in my country use Bitcoin to buy mobile load or pay services offered by one of our local wallet and exchange but when the ordinals came into action, things changed. I agree that most people still don't understand how beneficial Bitcoin is because their negative thoughts still stuck on their heads maybe because of FUD.

Bitcoin is a digital asset that can be stored at a cryptocurrency exchange or in a digital wallet. Each individual coin represents the value of Bitcoin’s current price, but you can also own partial shares of each coin. The smallest denomination of each Bitcoin is called a Satoshi, sharing its name with Bitcoin’s creator. Each Satoshi is equivalent to a hundred millionth of one Bitcoin, so owning fractional shares of Bitcoin is quite common.


Below are facts you would love to know about bitcoin

1. The coins are created by users who "mine" them by lending computing power to verify other users’ transactions which use blockchain technology.They receive Bitcoins in exchange.

2.The coins also can be bought and sold on exchanges with US dollars and other fiat currencies(the physical money we use every day in our bank accounts).


3. Bitcoins have to be stored in a digital wallet, either online through an exchange like Coinbase, or offline on a hard drive using specialised software.



It is believed that crypto currency is actually used in most countries today but it has not yet been known, although bitcoin is one of the fast rising crypto currency in the world today most people still don't understand how beneficial it is.


Hope you enjoyed it.