In today’s video we are going to deal with a topic that many of you have wished for. Namely the topic Bitcoin. We will look at what bitcoins are, how they wreak, what the technical implementation looks like, what the interests and disadvantages of bitcoins are and finally we will look at whether it is worth investing in bitcoins or not. Have fun with this video. Hi, my figure is Thomas from Finanzfluss and today we will deal with the topic of Bitcoin. In the last few years and especially in the past few months, you could hear a lot about Bitcoin or crypto currencies. In addition, there are now many other crypto currencies such as Ethereum, Ripple or Dash. Today we will take a look at the mother of all crypto monies, namely Bitcoin.So let’s start instantly with the issue: What is Bitcoin anyway. Even though Bitcoin has been in the media more and more in the last two to three years, the concept is much older. In 2008, the first conception newspaper by the founder of Bitcoin, Satoshi Nakamoto, was published. The real benefactor is not known to this day, since this name is a pseudonym that the founder used on many forums. Nonetheless, his true identity is not known. The Bitcoin is a digital monetary unit in a worldwide decentralized payment arrangement. Since it is a cash contingent, you can pay with Bitcoin. This necessitates bitcoins can be transferred from one person to another. The whole thing happens peer-to-peer from person to person without banks or other financial mediators standing in the way, as is the case in our classic payment arrangement with euros, dollars, British pounds, and this creates us straight-shooting to the belongings and how bitcoin duties. Bitcoins are stored in so-called billfolds. These are digital purses that you can either have on your smartphone or download onto your PC.Unlike the classic coin organisation where your money is managed in a bank in a current account, these pocketbooks is a matter for you. This means they are also stored on your PC or smartphone, which means that nobody can block these wallets. For sample, your checking account can be blocked by the bank or both governments, which is not the case with a wallet. There are also other restrictions that your bank may impose on you, for example for security rationales, such as transfer limits, peak sum of business. All of these restrictions do not exist with the Bitcoin wallet, since you are the master of this wallet yourself. Another spot regarding the restriction also applies to the geographical restriction. For example, while it is difficult or very expensive to transfer money to the other side of the world, say to Africa or Australia , for example , Bitcoin is not a problem.You can access your pocketbook from anywhere in the world if you have an internet connection there and likewise convey fund to any purse anywhere in the world. The programming system of theBitcoin protocol is open source. This represents everyone can look at it for free and form their own opinion on how Bitcoin operates and whether it is a safe technology in their eyes. Of direction, a certain technical understanding is required here. In this open source protocol you can also read that the number of bitcoins in the whole world is limited to 21 million. In the next step we will look at how these bitcoins are created. However, this development process is capped at 21 million. In this respect, bitcoin differ from classic so-called fiat currencies such as the euro, the U.s. dollars or the Japanese yen. This can be printed arbitrarily by central banks and there is no upper limit. As I said, it is different with Bitcoin. Let’s now turn to the technical implementation in order to understand exactly how such transactions take place from one Bitcoin owner to another and how Bitcoins are created.First of all, we have to look at the so-called miners, who are responsible for the creation of bitcoins and also for the validation of deals. Miners is part of the decentralized structure. You are responsible for authenticating events in Bitcoins. This entails is proved that a Bitcoin transaction from pouch A to wallet B actually has just taken place. Different bitcoin transactions all over the world accumulate in different blocks. Hence the term blockchain. In order to ensure the security of this deal, which is currently in the blocks, these blocks in mentions must be cracked. To do this, a little complicated arithmetic projects have to be solved in order to practically decipher this block. Only when the block is cracked are these transactions liberated and the money has actually been transferred from party A to party B. The task of cracking these blocks is now up to the miners. There are always numerous miners working at the same time to crack a block. However, only one person at a time manages to do this and he then receives a money payoff for his work for the computing influence that he makes available to the network.And this produces us to the process of creating bitcoins. From the 21 million bitcoins indicated in the bitcoin etiquette, a part is then quasi unfrozen and credited to him. So you can see that this decentralized network is run by the miners, who then validate these transactions between bitcoin incumbents. It is announced decentralized because theoretically anyone can work as a Bitcoin miner and then make their computing power available to the entire network. As a reward, you get bitcoins every time you crack a block. Cracking these blocks becomes more and more difficult over age and the payout, i.e. the reinforce for the miners, becomes less and less until the 21 million are reached.However, the miners still have a possible second source of income, namely the so-called transaction fees. So they are not only dependent on cracking the blocks, but can also prefer to carry out events whatever it is you also apply a small tip. Another technical characteristic that we need to discuss are the so-called ledgers. It is the case that all transactions that have ever taken place in the Bitcoin network are stored. These transactions are stored in the so-called ledger, which are capable of roughly be translated into German as a payment book. All transactions are listed here with the amount and wallet digit. This means that in this ledger we will see that person A with a certain wallet number has transposed such amounts in Bitcoin to being B or his pouch figure. All business can be traced in this ledger, but it is not known who established these transactions, since, as I said, merely the purse digit is represented and it is not possible to trace who owns which purse. When creating a wallet, you do not have to enter your name or address. Payment with Bitcoin is therefore just as anonymous as with cash.Although there are ways today to find out who owns which pocketbook, the basic idea of Bitcoin is still anonymous payment. Finally, to the technological persona, one must of course say that it is absolutely not easy to understand how the whole thing works with Bitcoin. We likewise had our difficulties there in working out the technical details and I hope that we were able to approximately outline the basic idea of the technological actualization of Bitcoin in this video. Now let’s take a look at the pros and cons of bitcoin. One of the advantages of bitcoin, which is why it was created, among other things, was that there are low transaction rewards. This is still the case, especially for transnational events. For precedent, if you want to send fund from one country to another in different currencies, it can be very expensive. With the assistance of bitcoins, the transaction costs can be extremely reduced. In addition, Bitcoin has the advantage that it can be used from anywhere in the world as soon as an internet relationship is available. Then another advantage is of course the decentralization. This means that you are no longer dependent on a third party, but that the busines actually makes sit in the network and is also stored in the network. The part notion is based on transparency. This means that you can easily understand when which transaction took place and at what amount, and at the same time privacy is protected, since the Bitcoin wallets are known but it is not directly traceable to whom which wallet belongs and therefore it is not publicly known who has which deals in how much and when. In addition, the payment with Bitcoins takes residence without certain restrictions, so you can transfer at any time no matter what amount and no matter to whom. Let’s now come to the hardships of Bitcoins and they actually lead hand in hand with these restrictions, which do not exist at the moment. Especially in the early years of bitcoin, it had a somewhat grime stature, since it was mainly used on the so-called dark web and used for illegal events. For sample, treats were bought with it, parties were trafficked and so on.The happening that it is not possible to trace who established a transaction has greatly promoted cybercrime on the Internet. The topics of tax evasion and coin laundering, which have also been procreated hugely easier by Bitcoin, likewise fall into the illegal place. Another drawback of bitcoin is the fact that it has significant price waverings and this is mainly because there are a lot of plungers in the market. Therefore, it is not yet fully mature as a payment system. Another harm is that storing Bitcoins can be very complicated and requires a certain technical understanding. In addition, the security of your own Bitcoin wallet is in your hands. That entails every Bitcoin user has to take care of the security of his purse himself, encrypt it and keep it as safe as possible. Finally, it can also be said that not so many shops or service providers accept bitcoins. For this reason, it is not yet very mature as an everyday remittance method. Finally, let’s consider whether it performs ability to invest in such a engineering as Bitcoin or in other crypto currencies.In assumption this is relatively easy to do. Bitcoin is sold on so-called Bitcoin exchanges. This is where the exchange rate is set between a bitcoin and a fiat money, such as the US dollar or the euro. You is available to use this exchange to pay in euros, for example, and then have bitcoins transferred to your wallet. Not all exchanges convene high insurance standards or are reputable. The link to a reputable exchange where you can watch the whole thing can be found below in the video description.In our views, investing in Bitcoins is not worthwhile as a long-term investment. It is certainly a super interesting engineering that can very well change entire industries. But there can also be technical difficulties, major spoofs and the Bitcoin will no longer be worth anything in a few years. If you still want to rely on the technology, you can stock up on bitcoins via such bitcoin exchanges . But be aware that it is pure speculation and not long-term wealth accumulation. If you want to invest fund in it, you should definitely do it with money that you don’t need or if you lose it, that wouldn’t be a problem. As was mentioned, there are a lot adventurers on world markets and Bitcoin in particular is extremely volatile. This means that there can be extreme price mounts but also expenditure falls.You should definitely be aware of this and keep your sentiments under control. I hope that members can experienced this video about the cryptocurrency Bitcoin. I know it’s not very easy to understand, so we welcome your questions. Write them to us in the comments below and if you demand, we’ll be happy to produce more videos on the topic of crypto monies for you. Feel free to tell us what other questions you have about Bitcoins, whether you would like to have presented other crypto monies and yes, if you liked the video, then like it and if you haven’t were in favour of us more, then do so.We would be glad. Every week we create brand-new videos and seminars on the topics: business concoctions, financings and speculation programmes so that you can take control of your finances yourself. Thank you and until the next video ..