Bitcoin: What you need to know

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Only this week, adze (TSLA) said it would soon accept Bitcoin as payment for its vehicles and revealed it had bought $ 1.5 billion in cryptocurrency as part of its cash holdings. In the meantime, Uber (UBER) and MasterCard (ME) they also said they intend to start accepting bitcoin. And BNY Mellon – the oldest bank in the United States, whose history dates back to Alexander Hamilton’s founding of the Bank of New York in 1784 – announced that it had formed a “digital assets” unit.

So, if you ignored bitcoin thinking it might just be a financial fad, now is the time to start paying attention. Here’s what you need to know.

Bitcoin is a cryptocurrency created in 2009 by an unknown person who uses the pseudonym Satoshi Nakamoto. Transactions are anonymous and are made without brokers or intermediaries.

You can’t physically use bitcoin – it’s a digital currency. And it is decentralized, which means it is not controlled by a bank or a government.

At this point it can be used everywhere from Overstock.com to PayPal – and this list is expanding rapidly.
Many people also see bitcoin as a good investment. And that was certainly true this week, given that Bitcoin hit a record high of $ 49,000 this week.

Where can I buy bitcoin?

Bitcoin is 100% digital. Markets called “bitcoin exchanges” allow people to buy or sell bitcoins using various traditional currencies. Coinbase is a leading exchange, along with Coinmama, CEX.IO and Gemini.

Where do I keep my bitcoin?

Bitcoin is stored in a digital wallet, which is either on the cloud or on the computer. It’s like having a virtual bank account. But unlike bank accounts, stored Bitcoin is not insured by the FDIC.

Wait, what has Elon Musk got to do with this?

Elon Musk, CEO of Tesla and SpaceX, has a history of supporting asset-tweeting activities and conveying their growing value, and the richest man in the world is a very big bitcoin booster.

“I guess [bitcoin] is on the verge of gaining widespread acceptance by people in the field of conventional finance, “Musk said in a recent interview on the exclusive audio clubhouse social app.

Not long after he formalized Tesla’s relationship with crypto, corporate ads began to flow.

Is Bitcoin safe?

Cryptocurrency is very volatile and therefore very risky. For example, in January, the value of bitcoin rose to $ 42,000, dropped to $ 30,000, then rose again to $ 40,000 – all within a week.

And there are some inherent dangers to a digital currency: a hacked server, a deleted file or a lost password could mean that funds are lost forever.

-— Paul R. La Monica, Chris Isidore, Tal Yellin and Hanna Ziady from CNN contributed to this report.

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