Q&A: How bitcoin digital currency works

bigbitcoin05 Jan 2014 / Detriot Free Press – Bitcoin is a digital currency — a form of Internet cash — that was introduced in 2009.

But it isn’t printed, like a dollar. It’s a form of money called cryptocurrency. Transactions are made by updating a log, but there’s no exchange of tokens. Buyers and sellers are identified through ID numbers, and bitcoin can be used to buy goods and services.

While bitcoin use is limited, an increasing number of merchants are accepting them as payment.

Here is a brief question and answer:

QUESTION: How does bitcoin work?

ANSWER: Bitcoin works like a mobile app that uses a virtual wallet to send and receive the currency. A network — essentially a public ledger called the block chain — records transactions.

Q: How do I get bitcoin?

A: You start by downloading a bitcoin wallet, such as Multibit.org or Bitcoin Wallet (for Android), to help manage it. Next, you can get bitcoin by accepting them as payment or by buying them from a friend. You can also buy bitcoin from an exchange (Teambitcoin.com offers one list of exchanges, for example) with a bank account.

Q: Who makes bitcoin?

A: Bitcoins are created through a system called mining. A miner makes bitcoin using software to solve math problems that help verify bitcoin transfers and, in exchange, are issued a certain number of bitcoin. Some miners have formed groups and divide up the bitcoin they mine….. Read more


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