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What is a bitcoin address?

 


What is the bitcoin? 

Bitcoin is the most important and well-known cryptocurrency. It was created in early 2009 as a follow-up to Satoshi Nakamoto's famous white paper. Bitcoin is based on blockchain technology. The basis is a decentrally organized booking system. A transaction involves a settlement between 2 parties. 


Bitcoin recession

A transaction is a peer-to-peer process in which there is no central intermediary. Furthermore, no central authority can gain control over the transactions. So banks or governments cannot control the network. Bitcoin is therefore a completely decentralized currency.


Where can I buy the bitcoin?

You can purchase Bitcoin as a currency and investment object on various digital platforms. Investors most often invest on the so-called crypto exchanges . These are specialized digital trading venues where you can exchange bitcoin and other cryptocurrencies for FIAT currencies like the euro and US dollar. You can also trade cryptocurrencies with each other.


Bitfinex is a specialized crypto exchange where you have over 100 cryptocurrencies to choose from in addition to Bitcoin. The Bitfinex exchange is a favorite for regular traders as it is extremely rich in trading features.




Binance 

Binance has only existed since 2017, but is by far the largest crypto exchange in the world. It offers more than 100 cryptocurrencies and is considered safe and reliable.


Coinbase is a San Francisco-based crypto exchange founded in 2012. It also offers a large selection of coins and is well suited for beginners.


Kraken

Kraken was created 1 year before Coinbase and is also based in San Francisco. It offers an easy-to-use interface to buy Bitcoin and other cryptocurrencies in Germany.


Another group of platforms where you can buy bitcoin are online brokers. These platforms offer a range of classic financial products and have included Bitcoin and other cryptocurrencies in their range in recent years.

An alternative to trading online is buying bitcoins from bitcoin ATMs . You can also exchange cash for Bitcoin. In this article , we discuss the concept of Bitcoin ATMs in more detail.


What is a bitcoin address?

A bitcoin address is a pseudonymous account where your bitcoins are located and to which more bitcoins can be sent. The address consists of a series of digits and letters.

A QR code that represents the address can also be used as a placeholder for the 34 digits of a Bitcoin address. 

All bitcoin addresses are publicly visible. So you can see all transactions on a specific address on Blockcypher and understand the transaction history.


However, the owner of an address remains completely anonymous. A Bitcoin address does not reveal an owner's name or IP address. 


How do I create a Bitcoin address?

The easiest way to create a Bitcoin address is on a crypto exchange. If you create an account with one of these platforms, you will receive your own address on the platform. 


When creating a Bitcoin address, the platform usually requires proof of your identity. You must therefore provide proof of identity in the form of your identity card or passport and often also proof of registration in the form of a consumption statement, registration certificate or rental agreement.


You will also receive a Bitcoin address if you create your own Bitcoin wallet. Bitcoin wallets store your access data to the Bitcoin blockchain in the form of public and private keys. This is essentially how they “store” your bitcoins. In this article , we discuss the best bitcoin wallets of 2022.


Can a third party see my data through my bitcoin address?

You should never share your Bitcoin address on the Internet on a public platform, as it can henceforth be assigned to you by other parties. This is common sense when dealing with a public address. Otherwise, your name and IP address are anonymous. 


However, since crypto exchanges own your data, government agencies can query your personal data at any time and assign your Bitcoin address to you. In this way, the state can ask whether you have paid your taxes on cryptocurrencies in recent years. We have covered this topic extensively  in this article .


What are the tips for handling your bitcoin address?

A bitcoin address is one of the most important pieces of information you get when investing in bitcoin. You should be very careful with your address:


Never post your Bitcoin address on a public platform in the digital space!

Do not pass your address on to other people, even verbally!

Protect yourself against hacker attacks on your PC!

Only use reputable crypto exchanges for investing!

If you follow these Common Sense rules, you are much safer when investing in Bitcoin. To further increase your security, you should consider a hardware wallet for your bitcoins.


Should You Invest in Bitcoin Now?

If you are not yet invested in Bitcoin and do not yet have a Bitcoin address, now is a good time, as the Bitcoin price has lost massively in value due to the onset of the bear market. Bitcoin is extremely cheap to buy at the moment. This gives you plenty of room to earn high returns with Bitcoin in the future.


Bitcoin course

An investment in Bitcoin should be motivated in the long term. Because it cannot be ruled out that the price of bitcoin will continue to fall in the coming weeks and months. But at the latest by the next bull market, the value of bitcoin should increase massively again.

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