/r/Bitcoin FAQ – Newcomers please read

  • Welcome to the /r/Bitcoin Sticky FAQ

    You’ve probably been hearing a lot about Bitcoin recently and are wondering what’s the big deal? Most of your questions should be answered by the resources below but if you have additional questions feel free to ask them in the comments.

    Some great introductions for new users are My first bitcoin, Bitcoin explained and ELI5 Bitcoin. Also, the following videos are a good starting point for understanding how bitcoin works and a little about its long term potential:

    Also have to give mention to Lopp.net, the Princeton crypto series and James D’Angelo’s Bitcoin 101 Blackboard series. Some excellent writing on Bitcoin’s value proposition and future can be found at the Satoshi Nakamoto Institute. Bitcoin statistics can be found here, here and here. Developer resources can be found here, here and here. Peer-reviewed research papers can be found here. Potential upcoming protocol improvements here. Scaling resources here. The number of times Bitcoin was declared dead by the media can be found here(LOL!), and of course Satoshi Nakamoto’s whitepaper that started it all! 🙂

    Key properties of bitcoin

    • Limited Supply – There will only ever be 21,000,000 bitcoins created and they are issued in a predictable fashion, you can view the inflation schedule here. Once they are all issued Bitcoin will be truly deflationary. The halving countdown can be found here.
    • Open source – Bitcoin code is fully auditable. You can read the source code yourself here.
    • Accountable – The public ledger is transparent, all transactions are seen by everyone.
    • Decentralized – Bitcoin is globally distributed across thousands of nodes with no single point of failure and as such can’t be shut down similar to how Bittorrentworks.
    • Censorship resistant – No one can prevent you from interacting with the bitcoin network and no one can censor, alter or block transactions that they disagree with, see Operation Chokepoint.
    • Push system – There are no chargebacks in bitcoin because only the person who owns the address where the bitcoins reside has the authority to move them.
    • Low fee scaling – On chain transaction fees depend on network demand and how much priority you wish to assign to the transaction. Most wallets calculate on chain fees automatically but you can view current fees here. On chain fees have risen recently due to network demand however instant micropayments are on the way via the Lightning Network, a second layer scaling solution currently rolling out on the Bitcoin mainnet. You can even run a node on a Raspberry Pi🙂
    • Borderless – No country can stop it from going in/out, even in areas currently unserved by traditional banking as the ledger is globally distributed.
    • Trustless – Bitcoin solved the Byzantine’s Generals Problemwhich means nobody needs to trust anybody for it to work.
    • Pseudonymous – No need to expose personal informationwhen purchasing with cash or transacting.
    • Secure – Encrypted cryptographically and can’t be brute forced or confiscated with proper key management such as hardware wallets.
    • Programmable – Individual units of bitcoin can be programmed to transfer based on certain criteria being met
    • Nearly instant – From a few seconds to a few minutesdepending on need for confirmations. After a few confirmations transactions are irreversible.
    • Peer-to-peer – No intermediaries with a cut, no need for trusted third parties.
    • Portable – Bitcoins are digital so they are easier to move than cash or gold. They can even be transported by simply remembering a string of wordsfor wallet recovery.
    • Scalable – Each bitcoin is divisible down to 8 decimalsallowing it to grow in value while still accommodating micro-transactions.
    • Designed Money – Bitcoin was created to fit all the fundamental properties of money better than gold or fiat

    Where can I buy bitcoins?

    Bitcoin.org, BuyBitcoinWorldwide.com and Howtobuybitcoin.io are helpful sites for beginners. You can buy or sell any amount of bitcoin and there are several easy methods to purchase bitcoin with cash, credit card or bank transfer. Some of the more popular resources are below, also, check out the bitcoinity exchange resources for a larger list of options for purchases.