After years of skepticism, bitcoin has finally gained mainstream credibility.

Tesla (tsla) now accepts bitcoin as a payment and discloses that it has purchased $1.5bn of cryptocurrency as part of its cash holdings. Payment processors, including PayPal, MasterCard and visa, are trying to simplify encrypted payments on their networks.

Meanwhile, it is reported that Goldman Sachs will soon provide channels for its private wealth management clients to invest in bitcoin and other digital currencies, and Morgan Stanley announced that it will provide channels for its rich clients to invest in bitcoin funds.

There is speculation that as more financial institutions invest in bitcoin, more companies will join in. Some investors said it could be a good hedge against inflation and a weak dollar. In March 2020, the US Federal Reserve cut interest rates, seriously weakening the US dollar and sharply raising the price of bitcoin.

Still, it's easy to swing. Bitcoin experienced a flash crash in mid April, with a sharp drop of nearly 14% in less than an hour. The reason is unclear, but speculation has focused on an unconfirmed twitter rumor that the U.S. Treasury plans to crack down on money laundering involving cryptocurrency. The value of bitcoin later rebounded.

So if you've been ignoring bitcoin and think it's probably just a financial fad, it's time to start paying attention. That's what you need to know.

What is bitcoin?

Bitcoin was created in 2009 by an unknown person using the alias Nakamoto. Transactions are anonymous and there are no brokers or intermediaries.

You can't actually use bitcoin - it's a digital currency. And it's decentralized, which means it's not controlled by banks or governments. Its basic technology is called blockchain, a kind of digital ledger.

At this moment, it can be in the Overstock.com And PayPal, the list is expanding rapidly.

Where can I buy bitcoin?

The market, known as the bitcoin exchange, allows people to buy and sell bitcoin in different traditional currencies. Coinbase and coinmama CEX.IO Together with Gemini, it's a leading exchange.

Where do I keep my bitcoin?

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

Wait, what does Elon Musk have to do with this?

Tesla and SpaceX CEO Elon Musk have a history of twitter backed assets and soaring asset values, and he is a huge bitcoin booster.

'I think [bitcoin] is going to be widely accepted by traditional financiers,' musk said in a recent acceptance on the audio only social app clubhouse.

Soon after, he formally established the relationship between Tesla and encryption company, and the company's announcement began to flow out.

Is bitcoin safe?

Cryptocurrencies are volatile and therefore risky. For example, in January, the value of bitcoin rose to $42000, fell to $30000, and then rose again to $40000 - all within a week.

There are some inherent dangers in digital currency: server hacking, file deletion or password loss may mean that funds are lost forever.

(2021-4-23)