Bit Coin. Please explain it to me like I am a 3 year old.

Dahboo 7 is promising a video in the future that is supposed to go into to detail about bit coins, block chain technology, and crypto currency.

I have to admit that this is something I can't seem to get my head around. Math is not my strongest suit and I have watched a ton of videos, but so far, I know what it is but I just don't understand it.

I know someone on ATS, understands how this works. Hopefully someone that understands it will be able to come forward and explain it to me so that I can understand it.

I am not asking about whether it is a valid currency or not. I just want to understand how it works.

This is the video that got me interested in having a better understanding of how crypto currency.

It is easier to think of Bitcoins like gold nuggets or diamonds. Something very rare, and takes a lot of work and digging to uncover. In the case of Bitcoins, the items in question are numbers....very rare numbers that require very powerful computer systems to find. The more that are found, the less there are to find, and the harder and more expensive it becomes to find more of them (like gold or diamonds). This makes the price rise as each one becomes more valuable as more money and time is spent "digging" for them.

It is a VERY simplistic explanation, but I hope that helps.

I used to know, it's based on the aggregation of processing data, atleast that's how it's 'farmed'.

I set aside 2k back in 2013 right when bitcoin popped up, I decided to not transfer it to bitcoins...

If had done so and withdrew it about a year ago, I'd haved turned that into 2mil...

@#$% Bitcoin, lol

Bitcoin life lesson: If you print them on paper so no one can steal them / you can´t loose them due to data loss, and forget where you put them, you´re doing it wrong (best example here).

Yes, several bitcoins. Bought them when they were less then 25€ each. Can´t find them now.

OP, once you feel comfortable with a general understanding of the technology, check out other cryptos like Ether and Litecoin as well.
This website lists cryptocurrencies by their market cap.

I'm far from an expert on this but I think what's been described so far is more about blockchain than bitcoin. From what I do understand, bitcoin uses blockchain technology. There are many other uses for blockchain. For example, businesses can exchange electronic documents using blockchain. The technology makes the transfer of the document safe and secure.

a reply to: NightSkyeB4Dawn

Bitcoin was designed as a peer-to-peer digital currency, to be used for transactions.

But very few people seem to be actually using it as a "currency". Most people are simply holding on to them like they are speculative investments.

a reply to: NightSkyeB4Dawn

You kind of think of bitcoins as a type of "credit card" in a very simple analogy. You use real money to "buy" or convert it into bitcoins that are placed in your account. There are "behind the scenes" encryption that happens guarantying that only you have this bitcoin. Nobody can "fake" or "counterfeit" those bitcoins. There are really huge prime numbers involved with a complicated mathematic equation that would take a supercomputer something like half the age of the universe to break or hack it. Maybe even more!

The real big change is that there is no "central back" or any middle man taking their "ATM fees" or tax cuts. That is a process called "decentralization" and where banks are shaking in their electronic boots. See, as of now, they have a monopoly when you deposit "your" money in their banks. Have ATM fees, check fees, too much money in your account fees, not enough money in your account fees? Have such a low interest rate that it is not worth putting money in the bank? Ever hear of negative interest rates? All of these are the con the big banks have over you. They can even refuse to give you "your" money from your own account if they want to!

When you are decentralized to the internet there is no "there" there! All that BS goes away with crypto currency like bitcoin. As more things are being placed onto the internet ("hosted" as a service) the very concept of citizenship might change as you are no longer bound to a physical boundary just the "e-services" provided by your "e-country"! And whatever e-currency it sides with.

Hoped that helped! A little more than a 3 year old.

Here is a good article from our friends at HowStuffWorks.com - How Bitcoin Works.

Wow, now that's a hell of a speculative bubble.
There's no way that's sustainable for much longer.

originally posted by: muzzleflash
Wow, now that's a hell of a speculative bubble.
There's no way that's sustainable for much longer.

-Said people ever since bitcoin was released 8 years ago. Meanwhile it went from less than $0.01 to $3,000 over the course of those 8 years and made many people filthy rich.
It's extremely sustainable, as has been proven since its creation.
You're just mad you missed out
It's not too late though. Bitcoin isn't even close to topping out, and litecoin is an even better opportunity right now. Buy while you can and HODL! See you guys on the moon!

originally posted by: trollz

originally posted by: muzzleflash
Wow, now that's a hell of a speculative bubble.
There's no way that's sustainable for much longer.

-Said people ever since bitcoin was released 8 years ago. Meanwhile it went from less than $0.01 to $3,000 over the course of those 8 years and made many people filthy rich.
It's extremely sustainable, as has been proven since its creation.
You're just mad you missed out

It's not too late though. Bitcoin isn't even close to topping out, and litecoin is an even better opportunity right now. Buy while you can and HODL! See you guys on the moon!

Is it sustainable? We'll see. Bitcoins biggest threat are the world banks. Can you image an internet currency that doesn't respect the status quo? I'm sure the banksters are watching this very closely and are already making plans to derail bitcoins.

a reply to: trollz

Well if it started out as .01 $ and is now 3,000 $ it sounds to me like I'm a bit late for the Gold Rush.
All those charts show it's value sinking btw.

I'd sell all of it right now and go find something else less tapped out to exploit.

Think of it this way, going from .01 to 3,000 is a factor of 300,000 times the original value.

Even if a bitcoin was worth 9,000$ tomorrow, that's only a factor of 3.
To increase in value by 300,000 times would be 900 million.

That's just silly. Especially considering it's pure speculation, there is no actual tangible resource in it aside of speculative investing. That's a pyramid scheme. Ponzi would be so proud.

A Ponzi scheme (/ˈpɒn.zi/; also a Ponzi game)[1] is a fraudulent investment operation where the operator generates returns for older investors through revenue paid by new investors, rather than from legitimate business activities. Operators of Ponzi schemes can be either individuals or corporations, and grab the attention of new investors by offering short-term returns that are either abnormally high or unusually consistent.

Companies that engage in Ponzi schemes focus all of their energy into attracting new clients to make investments. Ponzi schemes rely on a constant flow of new investments to continue to provide returns to older investors. When this flow runs out, the scheme falls apart.[2]

Tulip Mania

Tulip mania, tulipmania, or tulipomania (Dutch names include: tulpenmanie, tulpomanie, tulpenwoede, tulpengekte and bollengekte) was a period in the Dutch Golden Age during which contract prices for bulbs of the recently introduced tulip reached extraordinarily high levels and then dramatically collapsed.[2]

At the peak of tulip mania, in March 1637, some single tulip bulbs sold for more than 10 times the annual income of a skilled craftsworker.

10 times the annual income of a SKILLED craftsman!
In today's world that's like half a million dollars!
For a Tulip?

Hell, and with Tulip mania - there was an actual physical tangible resource behind the speculation.
With bitcoin there is.... imagination.

What is a coin of imagination worth? Will it be worth a million dollars one day?
Who knows... lol

a reply to: Krakatoa

You just explained that Pokemon game.

I'm an expert in this.....no bitcoin......

Etherium or etherclassic, and stack silver rounds, maybe not too much......farmable land.....agrable land is number one actually, then guns and ammo.....fertilizer and seed.......a way to keep social connections.....

originally posted by: Trueman
a reply to: Krakatoa

You just explained that Pokemon game.

The OP did ask to have it explained as if to a 3 year old.

originally posted by: Krakatoa

originally posted by: Trueman
a reply to: Krakatoa

You just explained that Pokemon game.

The OP did ask to have it explained as if to a 3 year old.

I must be 2 years old because I still can't play that game and no clue about bit coin yet.

One thing to consider. Most any country worth its salt can turn off the interwebs to most of its citizens like turning off the lights if it really wants to when the poop hits the fan..

Bitcoin seems to be interwebs based...

Sure, it may still be there, but if you can't get to it when you need it...

originally posted by: muzzleflash
Especially considering it's pure speculation, there is no actual tangible resource in it aside of speculative investing. That's a pyramid scheme. Ponzi would be so proud.

It's definitely not speculation. Major banks, organizations, governments all over the world are just now starting to implement blockchain technology. Microsoft themselves is part of a huge alliance involving many other major world organizations, like Credit Suisse, that came together to develop, improve and implement blockchain technology. Businesses like Overstock.com are even allowing customers to pay with bitcoin instead of their native currencies. There are bitcoin ATMs sprouting up all over the place.
I'm sure you also don't know this, but some countries have already recognized bitcoin as an actual legal currency.

So again, it's not speculation, you're just unaware of what you're talking about.