Frequently Asked Questions

What is Bitcoin?

Bitcoin is electronic money in the form of computer code. The purpose of the bitcoin code is to show ownership of scarce digital assets through a public, open-source, decentralized ledger called the blockchain. Bitcoin’s code minimizes inflation while making economic transactions easy.

Where did Bitcoin come from?  

The creator of Bitcoin is Satoshi Nakamoto. Satoshi Nakamoto is the online name of the person or persons who created Bitcoin. Nobody knows the real identity behind Satoshi Nakamoto and the actual identity of Satoshi has been wildly speculated about. Satoshi posted the code and concept of Bitcoin on an internet forum and it grew organically outward from there through grassroots support. No government or company is behind Bitcoin, it is now controlled by its decentralized computer network.

How does Bitcoin help the financial freedom and economic strength of the U.S.? 

There will only be 21 million units of Bitcoin ever created. It is built into the computer code of Bitcoin to never create more than 21 million units. This ensures Bitcoin will be scarce. Bitcoin’s inherent scarcity enables it to be a strong asset that mimics gold. Bitcoin is considered as such to be Digital Gold with governments throughout the world creating Strategic Bitcoin Reserves to compile the asset to achieve economic primacy in the technological age. Americans can use Bitcoin as a store of value and a hedge against the inflationary and big spending policies made by US Government and the Federal Reserve.

How is Bitcoin different than other cryptocurrency?

Bitcoin is decentralized while other cryptocurrencies are centralized. There is no choke point where Bitcoin can be targeted. There is no central area in which the Bitcoin network can be attacked to take it down. There is no group of founders who control the issuance of Bitcoin like there is for other cryptocurrencies. There are far more users, programmers and entrepreneurs within the Bitcoin network compared to other cryptocurrencies, and they are always working to improve and add value to the Bitcoin network. 

How does Bitcoin measure up to Gold?

Gold is a great and time-tested storage of purchasing power but it is not easy to send $100,000 oz worth of gold across the Atlantic Ocean in 10 minutes because it takes a long time to transport gold. You can perform this sort of transaction in Bitcoin quickly, making Bitcoin a far more convenient means to conduct monetary transactions than gold. Additionally, the Bitcoin code enables users to instantly divide bitcoin into smaller chunks while being able to seamlessly verify that the division still consists of real Bitcoin.

How does Bitcoin measure up to U.S. dollar?

The US Dollar is prone to unexpected money printing and massive amounts of inflation. The bitcoin code has a pre-programmed issuance that limits the amount that can be created. It gets much more difficult to create, or “mine”, Bitcoin as time progresses. We know precisely how much bitcoin will be created over the next 100 years. When will the next big trillion-dollar government bailout occur? How many trillions will it be? We have absolutely no clue on when or how much US Dollars the government is going to print as that power is controlled by the whims of political officials, not by computer code that is virtually impossible to change.

Can Bitcoin be used for everyday purchases?

Yes, but not many people use Bitcoin on a regular basis as a currency. It will become far more frequently used as a currency as more people buy Bitcoin. The Bitcoin Network is working on technological improvements to improve the user experience of doing daily transactions. Governments changing their legal tender laws will result in a massive increase of daily transactions because Bitcoin purchases are currently taxed under capital gains in most jurisdictions. It is not practical for Bitcoin users to track the capital gains every time they buy their groceries, for example. As legal codes are modernized, it will make more sense for Bitcoin to be used in regular transactions.

Why does Bitcoin use so much energy?

Bitcoin is designed to convert energy into currency. Its use of energy is a benefit not a hindrance. Bitcoin uses a lot of energy to make the computer network secure. The more energy Bitcoin uses, the harder it becomes for a bad actor to hijack the network because the bad actor will need to use more energy. Additionally, Bitcoin makes energy grids more efficient by putting excess energy to use and preventing seepage and spillage from energy-producing operations.

Can Bitcoin code be hacked or the Bitcoin network be shutdown?  

Bitcoin is fully decentralized and governed by code that resides in tens of thousands of computers from all over the world. Half of those computers would need to be destroyed or simultaneously hacked for Bitcoin to be taken down. Bitcoin’s inherently decentralized design makes it extremely difficult to sabotage.

How does Bitcoin stop inflation?

There are only 21 million Bitcoin that can ever be created. It is programmed into its computer code and inalterable. The value of Bitcoin cannot be printed or counterfeited away. Inflation, defined as money printing by government or central banking institutions, is impossible under Bitcoin.

What if the government cracks down on Bitcoin? 

Many governments throughout the world have tried to crack down on Bitcoin for years. It hasn’t worked. It has gone up consistently despite government interference. Now, governments are embracing Bitcoin out of ‘if you can’t beat em, join em’ syndrome. Many countries and states are researching Bitcoin and considering buying substantial sums of Bitcoin to protect the wealth of their nations. This will further push Bitcoin’s price upward.

How do I buy/sell Bitcoin? 

River Financial is a good, stable app to buy bitcoin from. You can get the River app on your smart phone. Learn more at https://river.com/signup?r=5DNFVVUY. You can also buy bitcoin in the form of an exchange-traded fund (ETF) on the New York Stock Exchange, but keep in mind that you don’t truly “own” your bitcoin when you buy it from an ETF. ETFs are entities that stockpile Bitcoin and other crypto to give investors exposure to digital assets. They have grown massively in recent years as Bitcoin’s value has risen.