Bitcoin investment tips: 12 things to know

By Nelson I. Nworie

Bitcoin is the buzzword of today. You see it on the news, hear people talk about it, and see ads everywhere. However, there is a lot of speculation and hype around Bitcoin that isn’t true. This blog will help you separate fact from fiction and give you all the information you need to decide if you should invest in this cryptocurrency.

1. Bitcoin is a digital asset and payment system that doesn’t require a bank or financial institution as a middleman. Transactions are instead verified by network nodes through cryptography and recorded in a public blockchain. Because there’s no intermediary, transactions can happen directly between users.
2. All cryptocurrency transactions are verified by network nodes through cryptography and recorded in a public digital ledger called a blockchain. Blockchains serve as digital ledgers for cryptocurrency transactions. Cryptocurrency nodes use the blockchain to verify transactions. Transactions are recorded in a block, confirmed by the network, and added to the blockchain. Transactions involving cryptocurrency are recorded in the blockchain.
3. A key feature of Bitcoin is that there are only 21 million of them in existence. This means that there is a limited supply of bitcoins, and the price will go up as demand increases. Bitcoin is also unique because it is decentralized, meaning it is not subject to the whims of central banks or governments. This makes it a very attractive investment for people looking for an alternative to traditional fiat currencies.
4. Bitcoins are created as a reward for the process of mining. Other currencies, products, and services can be exchanged for them. Mining is verifying and adding transaction records to the public ledger, called the blockchain. Adding transactions to the blockchain and verifying them rewards miners with bitcoins.
5. Over 100,000 merchants and vendors accept bitcoin as payment as of February 2015. This number has grown significantly since then, as more and more businesses have started to see the benefits of accepting bitcoin. Bitcoin offers several advantages for merchants, including lower transaction fees, no chargebacks, and no need for a credit card.
6. Any central authority does not control the bitcoin network. The maintenance of the blockchain is performed by a network of communicating nodes running bitcoin software. Using the blockchain, bitcoin nodes can distinguish between legitimate transactions and attempts to re-spend coins. As new blocks are mined worldwide, they are eventually broadcast to all nodes. 
7. Bitcoins can be used as a store of value, an investment, or an exchange. When used as a store of value, bitcoins can be used to purchase goods and services or be held in a digital wallet as a long-term investment. When used as an investment, bitcoins can be bought and sold on exchanges or used to purchase other assets, such as stocks or bonds. As a means of exchange, bitcoins can be used to buy and sell goods and services or exchange for other currencies.
8. During transactions, network nodes verify the transactions through cryptography and add them to a publicly distributed ledger known as a blockchain. Each network node stores its copy of the blockchain to achieve independent verification of the chain of ownership. This allows bitcoin software to determine when a particular amount has been spent, which is necessary to prevent double-spending in an environment without central oversight. Blockchains are the only places where bitcoins are stored as unspent outputs of transactions, as opposed to conventional ledgers, which record transfers of actual bills or promissory notes.
9. Bitcoin is volatile, and its price has fluctuated greatly over the years. In 2013, the cost of one bitcoin surged from $13 to over $1,000 in just six months. In 2014, the price fell sharply, and as of April 2018, it was around $6,600. In November 2021, it reached an all-time high as its value exceeded $65,000; in November 2022, it dropped to $16,833. 
10. Approximately every ten minutes, a new group of accepted transactions, called a block, is created and added to the blockchain. This process is known as mining and how new bitcoins are generated. Once a block is mined, it is quickly published to all nodes or computers on the network, and the transaction is complete.
11. Whereas the private key is used to sign transactions and provide mathematical proof that they have come from the owner of the bitcoin address, the public key is used to receive bitcoins. The private key is used to sign transactions and provide mathematical proof that they have come from the owner of the bitcoin address. The public key is used to receive bitcoins and is also used to verify the ownership of the private key. The public key is also used to generate the bitcoin address.
12. Bitcoin addresses are anonymous and do not reveal the owner’s identity. Bitcoin addresses are anonymous and do not reveal the identity of the owner. This makes it difficult for anyone to track down the owner of a particular address. However, it is possible to trace the movement of bitcoins from one address to another.

To conclude, studying bitcoin and understanding how it works before investing in it is very important. Bitcoin is a very volatile and risky investment, and it is important to be aware of the risks involved before putting any money into it. There are a lot of scams and frauds associated with bitcoin, so it is important to be careful and do your research before investing in it.