What is Bitcoin worth? This is the million-to-billion dollar question new crypto-coin enthusiasts are asking. Why all the hype and sudden-and-crazed (for a good reason) hoopla about digital currency? Here are numbers and explanations to help you understand the value of Bitcoin today.
How Bitcoin Actually Works
Bitcoins are run and powered by a system called blockchain technology. The oversimplification of how they work is that they are a “system” of “blocks”. Invisible, digital blocks, that is. Every block has the capacity to store information, and that’s exactly what it does.
A “block” records, stores, and secures transactions. Once full, a new block is created and is linked to its previous consecutive one via cryptography. And later, to the new and succeeding block. This process goes on and on.
Where conventional approaches “transfer” information onto peer-to-peer networks all over the planet, blocks are interconnected with each other. This, then, forms a lengthy history and timeline that has its roots from the first and original block, all the way to the incoming new ones.
This “linking” characteristic (another oversimplification) is what allows blockchains to be more safeguarded than non-blockchain methods. They contain pieces of information that are NOT merely passed on and on.
Instead, “nodes” or sets vastly growing clusters of computers/networks keep a copy of the blockchain ledger. Whatever information (transactions) has been saved stays permanent.
It may sound ironic but that “permanence” of records whether in transactions, writing these transactions, or safeguarding each one, adds to blockchain security. They are not “passed on” from a single network to the next, the way numerous traditional banking transactions do.
Should hackers try to steal user and transaction information, the same block being threatened will simply be transferred to a different blockchain. This will render the hacking operation null and void, and the threatened block useless to hackers.
Bitcoin Value: The Question Everyone’s Asking
We spoke with experts and we’re here to tell you exactly what they said. The value of the world’s first cryptocurrency is found in its demand and the number of its coins presently in circulation. It basically operates on “supply and demand”.
What does that mean? There is a fixed number of bitcoins across the globe. Satoshi Nakamoto, Bitcoin’s founder, meant it that way. This isn’t about how many coins have been mined so far. We’ll get to that on a different blog. There are 21 million bitcoins. It’s a fixed number.
Bitcoins do not have a value in the coins themselves but in how much demand there is for them. Translated, its value increases and/or decreases with how many people invest in them. The more Bitcoin investors there are, the fewer bitcoins remain untouched. The fewer bitcoins remain out of the 21 million, the higher their value becomes. Concurrently, pricing, too.
Although there are talks of increasing the number of bitcoins available (due to excessive demand ever since global events shook economy-backed currencies), the fact remains that it has never changed. There are 21 million of them and this will stay constant.
You’ve been following the news about cryptocurrencies and are now more motivated than ever to invest in Bitcoin. Rightly so. There is a surge in Bitcoin investors and there are much fewer coins available for both new and current users to buy and invest in, and for miners to mine. With our description above, Bitcoin’s value is growing, and so is the price of its coins.
While it is yet a generally non-stormy day, invest in bitcoins and follow our step by step guide in doing so as you go through our related posts. Invest in Bitcoin today before its value and coin price shoot up to big-fish price-tags. And they will. Sooner than you can say “Bitcoin”.