Sunday, July 27, 2014

How to get Bitcoin

 Different ways to get Bitcoin:

People who are new to using Bitcoin may be wondering, "how do I start getting some coin?"

Just as with conventional money, there are three basic ways to get it.  

  1. Earn it:  While most employers are not offering to pay their employees in Bitcoin, there are a few.  You can find them if you look for them on Google.  Most of these jobs are going to involve programming, software development, and the like; however there are a lot of blogs and niche websites out there looking for freelance writers and graphic artists who are willing to pay with the currency.  You can sell stuff online using Square and easily accept Bitcoin, or make your own website and place "Pay with Bitcoin" buttons linked to your Coinbase account 
  2. Buy it:  You can trade any other currency for Bitcoin on an exchange or in person.  To buy Bitcoins on an exchange in the U.S., I like to use Coinbase.  Buying in person is more private, since exchanges are regulated by governments and will eventually no longer be private.  To find local people to buy privately, I like to use LocalBitcoins.  A lot of people trade coins.  I've met a few that just buy coins on Coinbase, then sell them on LocalBitcoins with a small mark-up  
  3. Mining:  Bicoins are put into circulation through a process called "mining".  Mining is very
    similar to mining gold or silver.  There is a finite amount of Bitcoins possible (21 million total can be mined).  Currently there are about 13.1 million coins in circulation.  A Bitcoin miner is a special computer system that acts as an anonymous node on the network processing the transactions by writing them into the Blockchain (the public ledger of all Bitcoin transactions).  All miners around the world agree on the order of transactions placed in the ledger, and the order of transactions determines who owns what.  In the midst of this process, miners are also generating the cryptographic hashes needing to encode the blocks and secure the Blockchain.  Miners are rewarded for each successful block by receiving 25 newly-minted coins.  Today, mining has become so difficult that pools of miners typically hash together and divide the coins according to shares of work completed.  Successful mining requires a financial commitment, and continual upgrading of equipment to stay on top of the increases in difficulty.  

There are a lot of other creative things you can do to earn Bitcoins, feel free to leave your suggestions in the comments section.

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