What is Bitcoin? - Part 2

How Safe is Bitcoin as a Whole?

Short answer, it is really safe to transact with Bitcoin. In comparison, conventional banks tend to have high risk towards hacking activities due to its centralized nature and human’s fraud (eg. Corruption, Money Laundering).


As Blockchain is decentralized, every miner will have a record of all the transactions involved in Bitcoin.

Hey, what’s a miner? In essence, Bitcoin mining is a process where people worldwide validate Bitcoin transactions, instead of going through intermediary such as banks. Those people are called miners.

Imagine a scenario where I want to transfer 1 Bitcoin to my friend, Eddie. Data of this transaction would be available in the record of every miners in the world. Hence, if a hacker wants to modify this transaction, the hacker would need to hack in the majority of the miners in the world at the same time in order to modify the transaction between me and Eddie, which is near impossible with today’s technology.

Although rarely, Bitcoin related incidents did happen. In 2014, Mt. Gox, a Bitcoin exchange in Japan, 850,000 Bitcoins were found to be missing of which was found due to hacking activities. But since then, security of Bitcoin has been improving via better data encryption.

As a whole, Blockchain stands firmly as a technology that keeps transaction with Bitcoin safe. The only issue is the wallet that you choose to store and execute Bitcoin transaction. So make sure you choose a trusted platform to store your Bitcoins!
Blockchain ensures solid security in Bitcoin transaction

So, How Can I Get My Hands on Bitcoin?

By this time you must be wondering what is a Bitcoin wallet, yes? In essence, Bitcoin wallet is where we keep track of our Bitcoin and execute transaction. (Yes, just like our wallet!)

There are several ways to get access to Bitcoin wallet to get Bitcoin, but I will just focus on 2 for this article:

Bitcoin Exchange is the platform where you can buy Bitcoin using fiat currency (eg. MYR). Luno is one of the most widely used Bitcoin Exchange in Malaysia, be it among local industry players or Bitcoin enthusiast. The best part? You do not need to buy a whole unit of Bitcoin which will cost you a big fortune! You can purchase Bitcoin in decimal units according to your capital (eg. 0.0002 BTC = ~ RM3.67).

Referral link: https://www.luno.com/invite/ZKQST  

(If you ever plan to invest in Bitcoin, and find my article resourceful, do give me a hand by buying through my referral link! For any investment more than RM250, I will get Bitcoin worth of RM5. It will be used to fund my blog which ultimately aims to add value to you all with great articles! - But please read Part 3 finale before deciding whether to put your hard-earn cash on Bitcoin!)


Luno, one of the most commonly used Bitcoin Exchange in Malaysia

 Bitcoin Mining

As I mentioned earlier, Bitcoin mining is to validate transaction in the Blockchain network. For every transaction mined, miners will be rewarded with a small amount of Bitcoin. However, Bitcoin mining requires heavy graphics and processing power that conventional investor will not be able to afford.


Where can you spend your Bitcoin in Malaysia?

Merchants in Malaysia are adopting Bitcoin payment at a quick rate, of which some of them you can find around you are Jeq In The House Café in PJ Seksyen 17 and Viv’s Boutique Café & Restaurant in TTDI.

Money transfer or remittance is also a way for you to use your Bitcoin, considering Bitcoin has been strengthening so much against major currencies in the world.
Merchants are adopting Bitcoin payment in Malaysia

 Other type of Cryptocurrencies

Ether – Ether, the cryptocurrency behind Ethereum platform is the second most popular cryptocurrency after Bitcoin. However, Bitcoin and Ethereum are essentially different in nature, albeit both being traded in the cryptocurrency market. Majority Bitcoin adoption is on payment purposes, while Ethereum is on smart contracts that will automate contracts-related processes.

XEM – A cryptocurrency of the NEM platform, XEM is a rising cryptocurrency in the Asian market. While not as popular as Ether and Bitcoin, NEM is gaining adoption in the data-centric/big data market due to its simplicity to adopt and use.

Personally, I am holding some XEMs in hand for work purposes.
Ethereum and NEM 

Verdict: Part 2 is to strengthen everyone’s understanding towards Bitcoin, and for the Part 3 finale, I will finally analyze the risk and potential involved in Bitcoin investment! What kind of people are suitable to invest in Bitcoin? What is the future in the price of Bitcoin? Everything will be revealed in the Part 3 finale! Only consider whether to invest in Bitcoin after reading Part 3 of my analysis! 

If you are new to Bitcoin, you should be reading on Part 1 of my article! I have discussed about what exactly is Bitcoin and the technology behind Bitcoin. Read Part 1 of 'What is Bitcoin' here:

http://rockinxuan.blogspot.sg/2017/08/what-is-bitcoin-part-1.html

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