Many of us use the terms ‘Bitcoin ‘Bitcoins’ interchangeably. This article explains the difference between the two and why it’s important to distinguish them.
Bitcoin is a virtual currency that can be sent from person to person (or country to country) over the internet. It’s not a credit card or bank account and has no physical ownership. It is a widely used form of money which, like gold, cannot be duplicated. It’s not a credit card either – but many users are wary of using it as it’s seen as a method of purchasing drugs.
Bitcoins on the other hand are the same virtual currency. They are created by making transactions between users of the currency. To do this you will need to download a client onto your computer.
Bitcoins are bought for real money and used to buy goods from online merchants. You can’t actually ‘send’ bitcoins to someone. They’re just converted to it by a process called mining.
In a way, the mining process helps Bitcoins developers to maintain the security of the currency. When people make purchases of goods they become owners of them, the more they own, the more they’ll be paid when they make a transaction.
It’s important to remember that these two forms of money aren’t virtual. You can’t send one from one place to another without some effort on the buyer’s part. The main difference between the two is that with a virtual currency you don’t need to have it in your possession (your physical wallet). With the physical currency it’s always there for you to have.
This makes Bitcoin digital cash rather than a currency. So how does one buy a Bitcoin? A popular way is by buyingit online at various stores that accept the currency.
You will find that the higher the price, the more expensive the store and the higher the risk. When buying a Bitcoin you need to understand what you’re buying and to be sure that you’re receiving the right amount.