Cash to Bitcoin and Back Again
While the value of Bitcoins fluctuates daily, users need to be able to exchange their Bitcoins for traditional currency. To do so, they use a service like Coinbase that stores Bitcoins and converts them to traditional currency. Likewise, Coinbase converts traditional currency into Bitcoins.
Transferring Currency to Bitcoin and BackCoinbase is just one example of a secure Bitcoin wallet processing center. Coinbase allows users to securely store their Bitcoins, exchange currency for Bitcoins, or exchange Bitcoins for currency.
How Does Coinbase Work?
The first step to purchasing Bitcoins is to download an app like Coinbase and then set up an account. It’s a lot like setting up a Paypal account.
When you go to Coinbase, it shows the price of a Bitcoin at that moment. You have to sign up for an account (which you may or may not wish to do at this time). If you’d like to sign up now, go to Coinbase: https://www.coinbase.com/. Setting up an account at Coinbase is free.
After you sign up, connect your bank account. You’ll need to complete some verification steps before you can use the account. Like Paypal, a couple of very small debits will occur on your bank account. Once the verification steps are complete, you can start a purchase.
After starting your first purchase, you’ll complete your buy and Coinbase will deliver your Bitcoin. (Sales work the same way but in reverse.) The price of Bitcoin changes from moment to moment and you’ll see the current exchange rate before you buy.
Bitcoin ATM machines are popping up all over the U.S., and are especially flooding New York City. One of the largest Bitcoin ATM services is Coinsource.net, which shows a map of their machines’ locations.
The availability of these ATMs has become very important because if someone is attacked by ransomware, the hackers always direct their victims to a Bitcoin ATM where they will deposit the “ransom” to get the encryption keys to unlock their computer and files. For the most part, however, the hacker does not send the encryption key and the victim is not only without their files, but their money, as well.
The DarkNet is a haven for ransomware hackers.
Return on Investment (ROI)
While the return on investment (ROI) can be extremely lucrative, it can also be extremely expensive. When Bitcoin first started, you could buy a whole Bitcoin for very little money. Then, if you held on to the Bitcoins and didn’t spend them, they obviously became worth a lot more. With the number of vendors now taking Bitcoin as payment, the value of Bitcoins has increased, but so has the price. Depending on your spending ability and your patience, it can be a lucrative expenditure.
Video: Bitcoin Explained
For more information on the rise of the Bitcoin phenomenon, watch this video. (Note: If you choose to click this link, it will open in new tab, so close the tab or window to return to the course.)