Using Bitcoin is different from other currencies. Buy, save, and use. Let’s take a look at how each of these phases works in the context of Bitcoin.

Learn how Bitcoin works!

How to make Bitcoin.

The mining process creates new Bitcoins. Bitcoin creators have set up their system to create coins at a fixed price until miners release all 21 million Bitcoins allocated to them.

Bitcoins are mined by solving complex mathematical puzzles using mining rigs, which are powerful computers that can generate thousands of random strings per second to solve the puzzles. This process validates cryptocurrency transactions and creates new Bitcoins as a reward.

Mining rigs range from computers with powerful core processing units to application-specific integrated circuits designed specifically for mining cryptocurrencies.

How to Earn Bitcoins

Bitcoins can be earned in a variety of ways other than mining, including:

Odd jobs: Some companies offer Bitcoin as a reward for completing tasks like testing a website or retweeting a post. In some cases, the task may be as simple as answering a question.

Payment methods: Many major payment apps now allow you to pay each other with Bitcoin and other digital currencies. If you provide a service or sell a product to someone, you can request payment in Bitcoin through CashApp, Venmo, or PayPal.

Online Games: Some online games reward you with Bitcoin for completing tasks or winning games.

How to Store Bitcoin

Once you purchase Bitcoin, you need to put it into a digital wallet. However, not all digital wallets are created equal. There are two types of digital wallets: hot wallets and cold wallets.

Hot Digital Wallets

Hot wallets are connected to the internet and provide instant access to your money for purchases and transactions. This is usually done on a computer, mobile phone or tablet, but can also be done through a crypto exchange.

Receive a set of hot wallet keys to ensure security. However, if the keys are lost, so is the cryptocurrency. Cryptocurrency can also be lost due to computer failure, glitch, or even hacking. Therefore, it is common to store small amounts of cryptocurrencies in hot wallets.

When you store your Bitcoin on an exchange, the currency is less secure because the exchange owns the keys, not the users. If this exchange gets hacked or its servers fail, you could lose all your cryptocurrencies.

Cold Wallet

Cold Wallet is a cryptocurrency wallet without internet connection, so it is not susceptible to hacking or hardware errors. These are typically USB devices where the private key is stored.

You can also choose a paper wallet, which is the most secure storage location. This wallet can be generated by cold wallet websites that create printable public and private keys. The printed key is laminated and can be stored and protected in a bank locker or safe. Without these printed keys, no one can access your wallet.

Where can I buy Bitcoin?

Mining is not the only way to obtain Bitcoin. Bitcoin can be purchased on the open market. Here are some places you can buy it.

Cryptocurrency Exchanges: Bitcoin can be purchased with fiat currency on various cryptocurrency exchanges. Open an account and buy Bitcoin.

Investment companies: Some investment companies are starting to offer Bitcoin as an option. Sign up to buy and sell Bitcoin and other cryptocurrencies like stocks and bonds.

Bitcoin ATMs and Retail Stores: Bitcoin can be purchased through Bitcoin ATMs. When you purchase Bitcoin using your debit or credit card at an ATM, the currency will be deposited into your preferred digital wallet. You can also go to a retail store that sells Bitcoin and buy it there.

Banks: Some banks now support buying and selling Bitcoin. If you have a bank that offers this service, you can purchase Bitcoin through your online banking interface.

How to Use Bitcoin

Although Bitcoin is not a widely accepted form of payment, it can be used in a variety of ways beyond converting to fiat currency.

Debit Card: A Bitcoin debit card lets you spend your cryptocurrencies anywhere debit cards are accepted. Once the card is used, the correct amount of Bitcoin will be converted to local fiat currency.

Retail stores: Some online stores like Newegg and Overstock now accept Bitcoin as a payment option. No special debit card required. Just choose Bitcoin and pay that way.

Donations: Some charities accept Bitcoin as a donation method. It may also be tax deductible, and charities will not pay capital gains tax on the Bitcoins they receive.