This post is for the beginners who are interested in buying the cryptocurrencies but also interested in the blockchain anatomy. The blockchain is the technology made up of different sub-technologies, it provides an ecosystem that can be applied to any industry’s use case. The blockchain is still in its early stage and how it will shape the world in future is not fully known by the technocrats but it is the fact it is a disruptive technology.
Many organizations are working to establish prototypes and products, but none has surpassed the fame of Bitcoin yet. You must be wondering what is the relation between bitcoin and the blockchain ? Let me explain this in more detail after addressing some misconceptions from bit technical side.
Misconceptions about the blockchain
1) The blockchain is not a programming language, and there is no such thing as blockchain developer or programmer. But since the hype is so high in the society on the word of “blockchain”, that many Ethereum or hyper ledger developers started calling their selves as blockchain developer which is not correct.
2) The blockchain is not Bitcoin, but Bitcoin is an application which is built on the technology of the blockchain. Bitcoin is the first cryptocurrency which is formed on the foundation of the blockchain technology using C++ as a programming language.
3) Blockchain applications cannot be developed without understanding the whole ecosystem of the blockchain. If you know Ethereum’s Solidity or Hyperledger fabric or any other platform development kit, then you should understand the fundamentals of the technology as well as it’s protocol, network, and application layer stack. Secondly, understand what does it mean by participants, why permission blockchain or why private blockchain, how it will be regulated, how it will give the benefit of using DLT technology.
4) Not all cryptocurrencies are made from Bitcoin; there are many other cryptocurrencies like Ethereum or NEO which are built from scratch.
5) Not all cryptocurrencies are trustless which means there are some cryptocurrencies where central authority is monitoring the transactions, e.g., Ripple. Though the subject is a bit controversial regarding its basis as a cryptocurrency or blockchain.
What is Bitcoin
It is the cryptocurrency, which you can buy or sell through the internet. It is first true decentralized technology which is not controlled by any authority. It is a public technology, and anyone can become a part of the bitcoin stack. The bitcoin transactions are publically available, but everything is encrypted so no one can determine who owns how much bitcoins. The privacy is based on Public Key Infrastructure, and as an individual, you can own your private keys within your computers.
What is Wallet
A wallet is like a storage application for your cryptocurrencies. There are many online applications available who provide these storage facilities. The famous ones are coinbase.com and blockchain.info. To get some bitcoin under your account, you need to have such wallets.
Let’s Buy Some Bitcoin
When I was writing this article, I thought not to write much about the technology, but I couldn’t resist it. But in this section, you can find out how to buy bitcoins, remember this is just a beginner’s guide to see how your transactions will work.
People from UAE / PAKISTAN / Saudi Arabia
At the time of writing this article, big wallet companies like coinbase.com allow only or few countries, but following countries are not on their list, e.g., UAE, Saudi Arabia, and Pakistan. However, there is another way to buy and then transfer your bitcoins to the coinbase or blockchain.info wallets.
Different Types of Exchanges
The applications which provide the platform to buy or sell are called exchanges. Some of these exchanges are embedded within the same platform where you have a wallet. To buy new bitcoins, you must have a credit card, PayPal or any other regulated payment app with digital money. Not all exchanges have the same rules for instance maybe some wallets allow you to buy bitcoin through PayPal but some may ask you to fill up your credit card information.
Paxfaul ( Trading Website)
Paxful.com is a trading application where many miners, traders, buyers are routinely exchanging bitcoin or Ethereums. Once you create your account, you will able to see your new Paxful wallet address. Here you can find many different users who are selling bitcoin with their personal terms e.g. maybe the exchange rate would be higher than your expectation and they may ask you to show them your country’s id and clear photograph before selling you their bitcoins.
Also, you can choose the best approach how you would like to pay your dollars to get bitcoins like you can see there are many traders who are accepting PayPal payments. Once you deal with the trader, his bitcoins will get Escrowed under the Paxful site.
You have to pay within that duration and then upload the receipt of the transaction. Afterward, the trader will release your bitcoin. Make sure before you do any trading, read and do a small research on the stars and feedbacks from other buyers for that seller; this will help you to figure out if the seller is honest. But again culprit can be anywhere so be careful whenever you would do any transaction.
BitOasis.com ( UAE and Saudi Buyers)
The bitoasis.com is the regulated exchange and wallet working under the UAE Jurisdiction; they allow you to buy or sell bitcoin. You can connect your bank account with the BitOasis wallet using your credit card.
Once it is approved and verified by the BitOasis, then you can start purchasing new coins anytime. This is the authentic exchange, and you can bind your bank account with your wallet. It is very secure and the best platform to purchase or sell any bitcoin. You can also buy Ethereum on its trading platform. Another advantage of using this platform is you can convert your BTC anytime into fiat currency, and it will be deposit back into your bank. But the withdrawal option into Fiat currency is not available for the Saudi Arabian buyers anymore after the end of April 2018.
I have explained what bitcoin is and what is the relation it has with the blockchain. Also, I have discussed some misconception about the blockchain technology. Last but not least I wrote my experience how you can buy BTC, especially if you are living in Saudi Arabia or UAE. I hope you have enjoyed my article stay tuned for more knowledge in future.
Farhan Hameed Khan