12:05Bitcoin explained: what is it and how can you buy one?
What is bitcoin?
How much is a single bitcoin worth now?
Crypto investor Anthony Pompliano predicted that bitcoin could surge to $100,000 (£73,647) by the end of 2021, Business Insider reported. But other analysts have dismissed such predictions as “outlandish”, Sky News said.
How do you buy bitcoin?
Bitcoin can be purchased in fractions, meaning investors don’t need to spend thousands to get hold of the virtual currency. For instance, an investor can hold £10 worth of the cryptocurrency, which would equate to roughly 0.00058 of bitcoin.
Investors can store and manage their bitcoin in a virtual “hot wallet” on Coinbase. Some investors prefer a “cold wallet”, which takes the form of a small USB drive. These cost around £100 and are less vulnerable to cyber attacks.
How do you spend bitcoins?
An open mind on the issues that matter
The “anonymity” of these transactions has made the currency particularly popular with drug dealers, says ABC News.
What drives the bitcoin market?
“A few massive investors can rock it with a shrug,” Bloomberg says. “They can send prices plummeting by selling even a portion of their holdings. And those sales are more probable now that the cryptocurrency is up nearly twelvefold from the beginning of the year.”
Other external factors can have a significant impact on the value of cryptocurrencies. According to BBC News, a price crash in 2018 was attributed to China and South Korea’s crackdown on digital coin exchanges, which led to a sell-off “across the market globally”.
Who invented bitcoin?
In 2014, Newsweek claimed the founder was Dorian Prentice Satoshi Nakamoto, a 64-year-old father-of-six living near Los Angeles, although a brief interview with Nakamoto garnered no concrete evidence of this.
However, Australian entrepreneur Craig Wright told the BBC that he was part of a team of people who created the currency that is collectively known as Satoshi Nakamoto. Wired later said Wright may have been a “hoaxer” looking to capitalise on the bitcoin bandwagon.
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