It is expected that the stock of Bitcoins will be finished and fixed at 21 million units, which limits the risk of inflation. This stock is gradually “mined”, i.e. generated by Internet users who use complex software to do so.
Fixed at 21 million units, the stock of Bitcoins has not yet been fully “mined”. At the start of 2021, just over 18 million Bitcoins were already in circulation. The rate of production of money is, however, halved every four years: the circulation of new Bitcoins is therefore increasingly slow. It is now estimated that the last bitcoin will be mined around 2140.
The price of Bitcoin is extremely volatile,
as evidenced by the chart below:
What is Bitcoin used for?
Bitcoins are used as a means of direct payment online. However, they can be converted into dollars or euros on markets provided for this purpose. Physical coins have even been launched, which can be purchased online using either virtual Bitcoins or traditional payment methods. They remain, however, largely in the minority.
How to get Bitcoins?
To obtain Bitcoins in a way that is both simple and fast, you have to use online platforms where you can buy them for euros or another currency (coinbase, binance, etc.).
In most of these platforms, the purchase of Bitcoins is done in three steps.
First of all, you need to open an account on an active crypto sales platform by creating a username and password. It then becomes possible to fund this account in euros, or another currency, by bank transfer.
The user must then consult the site's order book. This order book lists the prices at which Bitcoin sellers are willing to exchange the virtual currency for euros, or another currency.
Finally, you have to place an order by offering a limit purchase price, which is the maximum price at which you are willing to buy Bitcoins. The order is only executed when a seller of Bitcoins offers a price lower than or equal to the limit purchase price. Once the order is executed, the user's account is fed with Bitcoins and his assets in euros, or in other currencies, are transferred to the Bitcoin seller.
It is also possible to sell your Bitcoins for euros, or other currencies, by placing a sell order. On most platforms, it is then possible to transfer euros to a bank account, by bank transfer.
This therefore means that a purchase of Bitcoins is not irreversible. However, it is important to beware of Bitcoin price variations, which may or may not be favorable to the user depending on the case.
How to spend your Bitcoins?
To pay a seller of goods or services in Bitcoins, it is necessary to receive an "address" from him. An address is a sequence of letters and numbers, to which the buyer sends the amount of Bitcoins due.
To receive this type of address, it is necessary to have a software wallet. You can install a software wallet on a computer (with the Bitcoin-QT software for example) or a Smartphone (Bitcoin Wallet). The software wallet not only allows you to receive these addresses when you are a buyer, but also to generate them when you are a seller. Thus, each user must have his software wallet.
Smartphone wallets sometimes allow you to pay in physical stores by simply scanning a code displayed on a screen. A very small number of shops, restaurants or hotels accept bitcoin payments, but the number is steadily increasing.
There are also web wallets: instead of being installed on a specific computer, the web wallet is available online from any computer, subject to having the username and password. However, these wallets are significantly less secure than software wallets.
Bitcoin transfers therefore take place through this game of address exchange: exchanging Bitcoins is comparable to exchanging emails. But, even more than for emails, it is crucial to secure your Bitcoin wallet, in particular by regular backups of your wallet.
A new use of bitcoin: ICOs
The introduction of a company on the stock market is called, in English, an IPO (initial public offering). An ICO (initial coin offering) is a somewhat similar approach, except that the fundraising is done in virtual currencies, of which bitcoin is the best known, and that you do not acquire ownership of the object. a company. In most cases, this involves funding a new blockchain or an application based on an existing blockchain. This type of funding can be similar to crowdfunding in that the public can directly fund a bitcoin start-up. These ICOs operate on unregulated markets, hence an increased risk for investors.
How are Bitcoins created?
Purchasing on platforms provided for this purpose is not the only way to obtain Bitcoins, although it is simple and fast. Indeed, Internet users can also participate in the process of creating new Bitcoins and thus obtain them. This is called “Bitcoin mining”.
A new user who wants to be satisfied with a purchase of Bitcoins through the intended platforms does not need to know how Bitcoins are created. However, a curious user may be interested in this process.
To ensure the credibility of the system, it is necessary that the authenticity of the payer and the availability of funds are verified when paying in Bitcoins. This is why a monitoring process is put in place: concretely, Internet users who are members of the network – the “Bitcoin miners” – invest in computer equipment that they make available to the system for its proper functioning and security. The computers of these Internet users are then put in competition to develop complex mathematical functions which make it possible to check the validity of the transaction. Whoever wins the validation is rewarded by receiving newly created Bitcoins.
