Bitcoin - Everything you have to know - Svajunas Maksvytis
Svajunas Maksvytis
Web & Apps Developer
Svajunas Maksvytis
Svajunas Maksvytis
Web & Apps Developer

Bitcoin - Everything you have to know


Bitcoin - Everything you have to know - Svajunas Maksvytis

It all started in 2009 when on some cryptographic site mysterious man called Satoshi Nakamoto posted a proposal for new money - Bitcoin. After 8 years Bitcoin is - what others call - the future of money and we have to understand it now more than ever before.

What is Bitcoin?

Bitcoin is digital cryptographic currency. It's like gold because it has limited amount of bitcoins which can be generated. The limit is 21 million which will be reached about at 2140 year. But the limit is not a problem because Bitcoin has 8 digits after the comma (1.00000000). That is because Bitcoin is generated at fixed rate. Bitcoin is decentralized network which means it does not belong to anyone. It's secure because it is based on Blockchain technology. You can send and get Bitcoins just like with normal money. But there is one big difference. All of those send/get transactions have to verified by Bitcoin Network to ensure the security. And that’s where Mining comes in.

How Bitcoin is generated?

Bitcoin is generated through process called Mining. In simple terms mining is using computer power to solve cryptographic problems. Every 10 minutes a new block of these problems is generated and all Bitcoin Network of computers is used to solve these problems. The Block contains all of the transactions which occurred in 10 minutes period. When computer solves the problem it is rewarded by some amount of Bitcoins and all of the transactions is being verified. Then that transaction is stored in public leddger in Blockchain and then those Bitcoins is sent to associated Bitcoin Wallet of that computer. When time passes and there is more ant more miners around the difficulity of mining increases and it becomes harder to mine BTC. But becouse the resource of BTC is limited and is getting harder to get one the price of BTC should increase.

What is Bitcoin Wallet?

It's a place where you store your Bitcoins. It is a random hashed string of characters which represents the address of your wallet. It can be virtual or physical. For ease of understanding is like your Bank account from where you can send or get Bitcoins.

What is Blockchain?

It's a technology which Bitcoin relies upon. Bitcoin blockchain leddger contains all of the ever made transactions and are connected and encrypted. It means that if you want to hack the transaction you have to hack all of them which is not possible becouse of the need of supermassive computer power. This information is distributed to all Bitcoin network and is the same everywhere. It means that it has millions of copies of itself and every copy has to be the same for transactions to be verified.

Bitcoin Mining

In 2017 the Bitcoin Network of Miners is one of the biggest networks in the world. There are millions of miners around the world which are contributing to the Bitcoin Network. In reality all you have to do is to turn on your computer, turn some software on and leave it to mine. Because there is so many miners it is almost impossible to solve problems alone. So there comes so called Mining Pools. A lot of computers connects to a bigger network. When one of the computers from the pool solves the Block all of the pool members share the reward depending of the calculation power you provide. 

Mining Hardware

All Mining is done through hashing. Best at this is called ASIC devices. They are Application Specific Integrated Circuits. They do only only thing - hashing. They cost a lot, eat power a lot, are very noisy but mine at the best rates possible and gives you the most bitcoins possible. You can also mine with GPU. For example, in 2017 NVIDIA GTX 1070 can mine about 0.0005 Bitcoins. And you can also mine with CPU but the rates are quite low even with the best CPUs around.


Nicehash is a miner which mines the most profitable coins and pay you in BTC. By using NiceHash with GTX 1070 and CPU in 2017 August you can get around 1.7 EUR per day or 0.00047 BTC. Take away the electricity cost and your earnings will be rougly 1.5 EUR per day. All you have to do is download NiceHash, enter your walet address, do benchmarks and run it. That's simple. 

Earning Bitcoins the other ways

1. There are cloud mining services around the internet but a lot of those are just scams. They use Ponzi scheme where you pay to them and they give you back your money in a long interval from your own money. They collect money from a lot of people and they disappear. But there are also and real ones. You buy the proportion of the hashing power they provide and they pay you every day in Bitcoins which they mined with your rented hardware.

2. There are services where you watch ads and get paid in Bitcoins with no investment.

3. There are free Bitcoin faucets where you enter captcha and earn Bitcoins once an hour or less for free of charge.

4. Buy Bitcoins from Bitcoin shops for real money. 

So how to start?

1. Read more about Bitcoins. Its price is increasing everyday reaching 4000 USD in 2017 August.

2. Create a wallet. It’s best to start with free and online one like this SpectroCoin. It’s very easy to use and it gives everything you need.

3. Try to mine using your computer hardware like CPU and GPU. Use miners like NiceHash. Calculate the electricity cost and profit they provide. If it’s good enough then try it. If you are Computer enthusiast you can buy a lot GPUs and make a Mining Rig or buy ASICs and put them to good use. 

4. Try the most popular Bitcoin faucet for free to get used to Bitcoins Every hour roll a dice and earn Bitcoins. Also you can hold your Bitcoins there and earn an interest every day. You can also use it like casino or lottery. Try it. It’s free.

5. Try watching ads for Bitcoins. This is the one the best paying, easiest to start and the least annoying one

6. If you like investing try Cloud Mining. They take real money from you and take away maintenance and electricity cost from your contracts. You get Bitcoins which is very unsteady. This way they get profit and guarantees. You get all the risk. Of course Bitcoin is rising every day but it always risky. They are company. They take real money and have it with no risks thats why cloud mining exists. Invest one time and get paid every day after in Bitcoins. There is no better Cloud Mining service than this one Genesis Mining. Also when you buy hashing power always use the discount code which will give you 3% discount. Discount Code "qExegv" or use this website


Other information