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Bitcoin and cryptocurrencies

What is Bitcoin, what is its price in USD and GBP, what is futures trading and how can you buy Bitcoin?

THE next phase of Bitcoin’s extraordinary development has been marked by the launch of its first ever futures contract overnight. As it stands on December 11, a single Bitcoin is valued at a staggering £12,407.60 ($16571.09). Experts believe the launch of Bitcoin futures could legitimise the digital currency as an asset class – and drive up […]

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THE next phase of Bitcoin’s extraordinary development has been marked by the launch of its first ever futures contract overnight.

As it stands on December 11, a single Bitcoin is valued at a staggering £12,407.60 ($16571.09). Experts believe the launch of Bitcoin futures could legitimise the digital currency as an asset class – and drive up its value even further.

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The value of Bitcoin surged at the beginning of 2017[/caption]

What is Bitcoin?

Bitcoin is a virtual currency that was created in 2009 by an unknown computer whizz using the alias Satoshi Nakamoto.

Individual Bitcoins are created by computer code.

The total value of all Bitcoin in existence is now more than £112billion.

Transactions are made without middle men, so there are no transaction fees and no need to give your real name.

More businesses are beginning to accept them and in some parts of the world you can even buy pizza with Bitcoins.

You can set up a virtual wallet websites like Blockchain to store,  keep track and spend your digital money.

You are also able to purchase Bitcoin through an online exchange or Bitcoin ATM.

To find merchants that accepts Bitcoin in the UK click here.

Bitcoins aren’t printed, like pounds, dollars or euros – they’re produced by people, and increasingly businesses, running computers all around the world.

It’s the first example of a growing category of money known as cryptocurrency.

Bitcoin is attractive to some users because of its anonymity, as well as its lack of government control.

The website Silk Road was closed in 2013 following raids by the FBI and other agencies amid allegations of drug dealing with authorities seizing millions of dollars worth of Bitcoin during the raids.

You can set up a virtual wallet on the internet to keep you bitcoins in
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You can set up a virtual wallet on the internet to keep your Bitcoins in[/caption]

How do Bitcoins work?

The value of Bitcoin, like all currencies, is determined by how much people are willing to exchange it for.

To process Bitcoin transactions, a procedure called ‘mining’ must take place, which involves a computer solving a difficult mathematical problem with a 64-digit solution.

For each problem solved, one block of Bitcoin is processed.

In addition, the miner is rewarded with new Bitcoin.

To compensate for the growing power of computer chips, the difficulty of the puzzles is adjusted to ensure a steady stream of new Bitcoins are produced each day.

There are currently about 16 million in existence.

The Bitcoin protocol – the rules that make Bitcoin work – say that only 21 million Bitcoins can ever be created by miners.

However, these coins can be divided into smaller parts with the smallest divisible amount one hundred millionth of a Bitcoin.

This is called a “Satoshi”, after the founder.

To receive a Bitcoin, a user must have a Bitcoin address – a string of 27-34 letters and numbers – which acts as a kind of virtual post box.

Since there is no register of these addresses, people can use them to protect their anonymity when making a transaction.

These addresses are in turn stored in Bitcoin wallets, which are used to manage savings.

What is its price in USD and GBP?

The record high for one Bitcoin of £8015 ($10,740) was reached on November 29 and basically sees the coin striking its mainstream moment.

The dramatic rise has been attributed to surging demand in China, where authorities warn it is used to channel money out of the country.

In March 2017 the price exceeded the value of an ounce of gold for the first time – then around £940.

What is mining and how does it work?

The creators of Bitcoin designed the system so there would only ever be a limited supply of bitcoins to be mined (a maximum of 21 million).

To ensure the longevity of the system, the cryptographic problems involved in the mining get progressively harder, meaning it takes longer to earn them.

Miners are turning to more powerful computers to complete these tasks and earn bitcoin.

As a result, mining (and on the flipside, bitcoin transactions) are sucking up greater and greater amounts of electricity.

Bitcoin transactions now use so much energy that the electricity used for a single trade could power a home for almost a whole month, according to Dutch bank ING.

The bulk of Bitcoin “mining” is done in China, where energy costs are comparatively cheaper than in places like the UK or US.

What will happen with Bitcoin’s futures trading?

This latest development could have a huge impact on Bitcoin’s ultimate success.

Futures, as they are known, allow two parties to exchange an asset at a specified price at an agreed upon date in the future.

The combined value of every bitcoin currently in existence is around $274bn – more than most major companies.

In theory, investors will now be able to bet against Bitcoin – which could help find the currency’s true value.

Where can I buy Bitcoin and how much is it worth?

Several marketplaces called “Bitcoin exchanges” allow people to buy or sell Bitcoins using different currencies.

Japan-based Mt Gox is the largest Bitcoin exchange. It was launched in July 2010, and by 2013 was handling 70 per cent of all Bitcoin transactions.

Five years ago a bitcoin was worth less than £7 – now it is valued 500 times higher
XE.com

People can also send Bitcoins to each other using mobile apps or their computers in the same way people send cash digitally.

The value of Bitcoin has fluctuated wildly since they were introduced and have reached a record high.

In 2013 when they first came to public attention, the value soared by 10,000 per cent before the price crashed.

A year ago in September 2016, a Bitcoin was being traded for around £469.

In October 2017, a Bitcoin is traded for more than £4,000, according to currency tracker XE.com.

Is Bitcoin the future of online trading?

No one knows what will become of Bitcoin as it is mostly unregulated, but that could change as governments are concerned about taxation and their lack of control over it.

So its’ USP – the anonymity – could eventually prove its downfall.

While it keeps Bitcoin users’ transactions private, it also lets them buy or sell anything without easily tracing it back to them.

That’s why it has become the currency of choice for people online buying drugs or other illicit activities.

And not many governments will put up with that for long.

However, it is increasingly used in shops and restaurants – with a fraction of a bitcoin used to buy a pizza, for instance.

And people selling their houses have even said they are willing to accept the cryptocurrency.

Daniel Roy put his £1.65million townhouse in Peckham, South London, on the market for 500 bitcoin in September 2017.

The following month a newbuild family home in Colchester, Essex, was marketed for 82.55 bitcoin, equivalent to around £25,000 less than if paying in sterling.

How much did the NHS cyber attack ransomware hackers demand?

The biggest cyber attack in the history of the NHS caused “significant problems” with IT systems and telephone networks across NHS trusts in England and Scotland.

Hackers encrypted files demanding NHS staff pay ransoms of $300 (£233) per computer via the digital currency service Bitcoin to regain access.

They warned the sum would be doubled if it was not paid within three days.

A man accused of stealing £1million in bitcoins to fund a luxury lifestyle has denied fraud in the first trial of its kind.

Ryan Kennedy, 30, siphoned off a huge sum in digital currency in a “very complex and sophisticated fraud”, say prosecutors.

 

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Bitcoin and cryptocurrencies

How to buy Bitcoin, is the digital currency safe and what are Iota and Ethereum?

THE digital currency Bitcoin continues to confound expectations as it hits headlines across the world. Here’s everything you need to know if you’re thinking of investing in Bitcoin or one of the other cryptocurrencies… How do I buy Bitcoin? The most common way to buy the currency is to download a broker app such as […]

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THE digital currency Bitcoin continues to confound expectations as it hits headlines across the world.

Here’s everything you need to know if you’re thinking of investing in Bitcoin or one of the other cryptocurrencies…

Bitcoin is going from strength to strength – but how long can it last?
Getty - Contributor

How do I buy Bitcoin?

The most common way to buy the currency is to download a broker app such as Coinbase and Blockchain.

These allow users to use a credit or debit card to exchange pounds for Bitcoin.

Users do not have to buy whole Bitcoins and can purchase a small percentage that matches the value of their cash investment.

Once a request has been made, online “miners” will decide whether to approve the transaction.

If approved, the money will be taken from a user’s account in exchange for Bitcoin.

When selling, users can use the same app to sell their Bitcoin in return for its cash value.

It is also possible to buy Bitcoin directly from sellers on other websites – bypassing the need for a broker.

There are fewer transaction fees in this case, but the process is a bit riskier and more complicated – especially for a beginner.

Investors can also buy Bitcoins by depositing cash at a nearby Bitcoin ATM.

These have been popping up in newsagents and can be found by Googling them or visiting Coin ATM Radar.

Is it safe to buy Bitcoin?

Anyone thinking of investing in Bitcoin or another cryptocurrency should be very careful.

Their values are volatile, with the ability to plummet as quickly as they shoot up.

And investors are frequently targeted by hackers and other criminals who seek to steal their crypto-cash online.

Be especially careful if you are using direct, peer-to-peer platforms to sell and buy cryptocurrencies.

These are the equivalent of something like Gumtree for Bitcoin – you never know who you might be dealing with.

What are Iota and Ethereum?

Iota – which stands for Internet of Things Application – is a new cryptocurrency, similar to Bitcoin.

But it is different in certain key ways.

Bitcoins aren’t printed, like pounds, dollars or euros – they’re produced by people, and increasingly businesses, running computers all around the world.

To process Bitcoin transactions, a procedure called “mining” must take place, which involves a computer solving a difficult mathematical problem with a 64-digit solution.

For each problem solved, one block of Bitcoin is processed.

Iota, on the other hand, removes the need for this by asking anyone submitting a transaction to verify two other random transactions.

It all sounds quite technical but it basically means it is decentralised, there’s no fee for transactions and the more people using Iota the faster the network becomes.

Ethereum is another cryptocurrency – one which some have said could overtake Bitcoin as the dominant coin in the market.

But it is also a ledger technology – using “blockchain”, like Bitcoin – that companies are using to build new programmes.

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Bitcoin and cryptocurrencies

Bitcoin marketplace NiceHash robbed of $70MILLION by hackers as cryptocurrency breaks through the $16,000 mark

CYBER thieves have made off with $70million worth of Bitcoin in a sophisticated heist targeting an exchange. NiceHash, a Solvenia-based Bitcoin exchange, has said about 4,700 of the currency – each worth more than $16,000 – were stolen from its “wallet”. The company has suspended transactions as it investigates how the hackers made off with […]

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CYBER thieves have made off with $70million worth of Bitcoin in a sophisticated heist targeting an exchange.

NiceHash, a Solvenia-based Bitcoin exchange, has said about 4,700 of the currency – each worth more than $16,000 – were stolen from its “wallet”.

Getty - Contributor
Cyber thieves have stolen millions of pounds worth of Bitcoin from an exchange[/caption]

The company has suspended transactions as it investigates how the hackers made off with the loot, thenextweb reports.

Exchanges such as NiceHash offer Bitcoin for a user’s computing power – which is utilised to make more of the currency.

A warning has been issued to NiceHash users to change their passwords in light of the hack.

In a statement NiceHash said: “Clearly, this is a matter of deep concern and we are working hard to rectify the matter in the coming days.

“In addition to undertaking our own investigation, the incident has been reported to the relevant authorities and law enforcement and we are co-operating with them as a matter of urgency.”


How safe is it to invest in Bitcoin?


The exchange was targeted as Bitcoin’s value surged reaching $16,000 today having started the year below $1,000.

The virtual currency was created in 2009 by an unknown computer whizz, using the alias Satoshi Nakamoto, and the individual coins are made using a computer code.

Fears of a Bitcoin crash have been growing as the virtual currency continues to attract half a million new investors every day.

This is believed to be the second major cryptocurrency theft – after startup Tether lost a reported $31million of Bitcoin.


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Bitcoin and cryptocurrencies

Iota price and how to buy – what is the cryptocurrency and how does it compare to Bitcoin?

IOTA is the latest word on the tips of people’s tongues as cryptocurrencies continue to make the news. Here’s everything you need to know about it… What is Iota? Iota – which stands for Internet of Things Application – is a new cryptocurrency, similar to Bitcoin. But it is different in certain key ways. Bitcoins […]

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IOTA is the latest word on the tips of people’s tongues as cryptocurrencies continue to make the news.

Here’s everything you need to know about it…

Iota is a bit like Bitcoin but different in a few key ways
Iota is a bit like Bitcoin but different in a few key ways
Getty - Contributor

What is Iota?

Iota – which stands for Internet of Things Application – is a new cryptocurrency, similar to Bitcoin.

But it is different in certain key ways.

Bitcoins aren’t printed, like pounds, dollars or euros – they’re produced by people, and increasingly businesses, running computers all around the world.

To process Bitcoin transactions, a procedure called “mining” must take place, which involves a computer solving a difficult mathematical problem with a 64-digit solution.

For each problem solved, one block of Bitcoin is processed.

Iota, on the other hand, removes the need for this by asking anyone submitting a transaction to verify two other random transactions.

It all sounds quite technical but it basically means it is decentralised, there’s no fee for transactions and the more people using Iota the faster the network becomes.

How do I buy Iota?

You can buy Iota by using something called a crypto exchange – the same as if you were buying other cryptocurrencies.

The main difference with Iota is that it is not available to buy directly with traditional cash – you can only trade it for another cryptocurrency.

That means if you want to get your hands on some Iota, you first need to acquire something like Bitcoin or Ethereum.

Some of the most popular options for buying these are Coinbase, Blockchain.info and Xapo.

You can then trade them on certain crypto exchanges for Iota.

There are currently only two exchanges with significant trade volume of Iota – Bitfinex and Binance.

Bitfinex is based in Hong Kong and is better for non-US customers.

But anyone thinking of investing in Iota or any other cryptocurrencies should be very careful.

Their values are volatile, with the ability to plummet as quickly as they shoot up.

And investors are frequently targeted by hackers and other criminals who seek to steal their crypto-cash online.

Is Iota as valuable as Bitcoin?

Iota is not as valuable as Bitcoin, which was today (11 December) trading at £12,503.76 for a single unit.

Iota is a newer currency which – trading as “Miota” – is worth  £3.34 ($4.44).

But its value has shot up by more than tenfold over the last six months.

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