WHAT IS BITCOIN (Basics)

Who created Bitcoin?

A person or group of people named Satoshi Nakamoto.

What is Bitcoin?

Bitcoin is a transparent peer-to-peer version of electronic cash that allows for instant online payments between one party and another without a financial institution. Bitcoin is public, open access, open source, borderless, secure, decentralized and censorship resistant.

When was Bitcoin created?

The Bitcoin network was started on January 3, 2009 with the Genesis Block and has continued to run without any interruptions or downtime.

Why is Bitcoin important?

Bitcoin is important because it does not rely on trust, it relies on cryptographic proofs which are a strict set of rules that cannot be changed without a general consensus within the community. When you store your money with a bank, it is no longer your money, it is the banks money. With bitcoin you have full control and ownership of your own hard-earned money.

Where can I get bitcoin (BTC)?

Bitcoin can be purchased at your local Bitcoin Mart ATM with cash, a variety of online exchanges with card and in rare cases in person exchange.

What is the difference between ‘Bitcoin’ and ‘bitcoin’?

‘Bitcoin’ refers to the Bitcoin network whereas ‘bitcoin’ refers to the unit of currency that is exchanged over the Bitcoin network.

How many bitcoins are there?

Bitcoin is a fixed supply asset with over 19 million bitcoins in circulation today. With a maximum lifetime supply of 21 million coins, this means that over 90% of bitcoins are currently in circulation and the last 10% will be distributed up until the year 2140.

What is a satoshi?

A satoshi is similar to a cent or penny. A satoshi or commonly referred to as ‘sats,’ is 1-100 millionth of a bitcoin (0.00000001 BTC) and is the smallest denomination of a bitcoin. For example, 0.001 BTC is 100,000 satoshis or sats.

WHAT IS BITCOIN (Advanced)

How does Bitcoin work?

Bitcoin works as electronic cash by storing the information of transactions inside a block which is then linked to the previous blocks and this forms the blockchain. The information on the Bitcoin blockchain is kept fully secured by its Proof of Work consensus mechanism.

What is the Bitcoin network?

In short, the Bitcoin network is an interconnected set of computers that stores and verifies transactions on a fully transparent public ledger. The Bitcoin network is completely decentralized with no central server or trusted parties.

What is the Proof of Work consensus mechanism?

The Proof of Work consensus mechanism is a permissionless lottery system, with a regular difficulty adjustment, that ensures that the integrity of each block is protected by a majority decision. The Proof of Work mechanism ensures information stored in the past cannot be altered without approval of every transaction that occurred after it.

What is the Bitcoin protocol?

The Bitcoin protocol is a predefined set of rules that dictate how the Bitcoin blockchain operates and provides a structure for all network participants to follow in order for the blockchain to function.

Can Bitcoin be hacked?

Due to the decentralized nature of the Bitcoin, it is nearly impossible to ‘hack’ the Bitcoin network.

Does Bitcoin require internet to use?

Although, internet is not required to receive bitcoin, it is required to send bitcoin over the Bitcoin network.

What happens if the internet is down does the Bitcoin network stop?

No, if the internet is shut down across Canada there are other computers around the world confirming transactions on the Bitcoin network. If all the internet went down across the world the Bitcoin network would stop and then resume when one computer resumed operating on the Bitcoin network.

HOW TO BITCOIN

What can I use bitcoin for?

Bitcoin can be used to purchase a variety of goods and services online and in person. There are 250+ major companies that allow for bitcoin and other crypto currencies to be exchanged for goods and services. Click here to see which companies accept bitcoin today!

How can I buy bitcoin?

The most secure and anonymous way to purchase bitcoin is with cash from a Bitcoin ATM. Purchasing bitcoin with cash allows you to directly take ownership of the bitcoin and not rely on a third party to keep and secure your coins.

When you hear about people losing their bitcoins due to a hack this is a result of people trusting third party online exchanges to safely and securely store their money. The Bitcoin network itself is nearly un-hackable.

Do I have to buy a full bitcoin?

No, this is a common misconception that you must purchase a whole or full bitcoin. Bitcoin can be purchased in any increment; start stacking sats today with as little as $20 at your local Bitcoin Mart ATM.

How do I store my bitcoin?

Bitcoin can only be stored in a Bitcoin wallet which can be an app on your phone or computer, a dedicated hardware device or on paper. You must have a wallet to purchase or use bitcoin.

It is crucial that you DO NOT lose access to your Bitcoin wallet as your funds will be lost forever.

What is a Bitcoin wallet

A Bitcoin wallet is a software that manages your private and public keys and gives you access to your funds that are stored on the Bitcoin blockchain. A Bitcoin wallet is not a physical wallet that you store bank cards and cash in.

What is a Bitcoin private Key?

A Bitcoin private key allows you to access your bitcoin on the blockchain. The private key allows you to sign transactions on the Bitcoin network to send bitcoin to someone. Having the private keys of a bitcoin wallet is similar to having a cheque book. A cheque cannot be cashed unless the owner of the cheque signs it.

The private key of a wallet is sometimes called a recovery seed or pneumonic seed phrase. Your private key SHOULD NEVER be shared with anyone. The recovery seed or pneumonic seed phrase should be written down on paper and stored securely. The private key should never be stored on: your computer, your phone or online.

What is a Bitcoin public key?

The Bitcoin public key is the address you give to other people when you want them to send you bitcoin. The public key is linked to the wallets private key, and it is impossible for someone to get the private key from the public key.

How do Bitcoin transactions work

As a user, Bitcoin transactions work similar to auto deposit E-transfers except the address you are sending Bitcoin to is someone’s public key.

Example: bc1qj4mr5djetj9ah0qsrhmlta6ash9ha027tx74xc

It is VERY IMPORTANT that you double or triple check the public wallet address you are sending your bitcoin to. Sending bitcoin to an incorrect wallet address will create permanent lose of funds.

Can I send bitcoin to someone across the world?

Yes bitcoin is borderless, you can send as much or as little bitcoin to anyone across the world for as little as $3-5 CAD.

Can I take bitcoin anywhere in the world?

Yes, bitcoin is borderless! As long as you have access to your wallet you can use or take bitcoin anywhere in the world with you and nobody can stop you from doing so. Bitcoin allows for full control over your own money, unlike the traditional banking system.

What happens if I lose my bitcoin?

If you lose access to your wallet you have lost your ability to access your bitcoin on the blockchain and therefore have lost your funds forever. Losing access to your wallet means losing your private key/ pneumonic seed phrase. It is critical that you DO NOT lose access to your private key/ pneumonic seed phrase.

Are bitcoin transactions reversible?

Bitcoin transactions by nature are unreversible, this is one way it solves the ‘double-spend’ problem that many other electronic cash protocols in the past failed to deliver on. It is VERY IMPORTANT that you double or triple check the public wallet address you are sending your bitcoin to.

Is Bitcoin trackable?

In short yes and no, although the transactions made on the Bitcoin network are fully viewable by the public, the identities involved with the transactions are unknown to the public. This information is only available to businesses or institutions who you have personally given your information to.

Is Bitcoin illegal to own in Canada?

Although Bitcoin is not legal tender in Canada, it is not illegal to own, send or mine Bitcoin in Canada. Bitcoin transactions and institutions are regulated by FINTRAC, which is the Financial Transactions and Reports Analysis Center of Canada. Bitcoin Mart Ltd is fully registered and follows the guidelines of FINTRAC.

Do I need to pay taxes on Bitcoin?

The Canadian Revenue Agency (CRA) does not consider holding or storing bitcoin a taxable event. You may be involved in a taxable scenario in some of the following examples:

• Selling or converting Bitcoin into Canadian Dollar.
• Selling or converting Bitcoin into another virtual/ crypto currency, such as Ether, Litecoin, etc.
• Buying goods or services with Bitcoin or other cryptocurrencies

Click here for full information regarding taxes in Canada with Bitcoin or other cryptocurrencies

Bitcoin Mart Ltd is not able to offer tax advice regarding the cryptocurrency it offers. It is advised to speak with a certified tax professional regarding questions about your potentially taxable scenarios.