Many so-called orthodox traders smile condescendingly at the mere mention of Bitcoin trading. Technically, trading cryptocurrency is no different from trading conventional currencies or other assets. Yet there’s no central bank whose chairman can clarify market conditions or outlook for Bitcoin — no key economic announcements, no official policy statements. In short: pure exoticism.
The situation shifted dramatically in 2017, when the Bitcoin to USD exchange rate surged spectacularly, reaching $3,000 per coin. Both novice and experienced traders took a closer look at this digital currency. Below is a concise crypto primer covering everything essential about Bitcoin.
- Who invented Bitcoin?
- Why did the Bitcoin price rise so sharply?
- How many Bitcoins can be ‘minted’?
- When will Bitcoin mining end?
- Can Bitcoin become a global currency, replacing traditional money?
- Is solo Bitcoin mining profitable?
- How to set up your own Bitcoin wallet?
- How to earn money with Bitcoin?
- How do news and macroeconomic data affect Bitcoin’s price?
- Does technical analysis work for BTC/USD trading?
- Scalping and Bitcoin are incompatible
- Frequent gaps in Bitcoin price action
- Which trading sessions suit Bitcoin best?
- Are there dedicated Bitcoin trading strategies?
- Should you start trading Bitcoin?
Who invented Bitcoin?
Bitcoin was first introduced to the public in 2009 by an individual (or possibly group) using the pseudonym Satoshi Nakamoto. Whether Satoshi Nakamoto is a real person or a collective remains unknown. Communication occurred exclusively via online forums and email.
No public statements have been issued under that name in recent years. Nevertheless, the original Bitcoin network rules and open-source software created by Satoshi remain fully operational — and the network is designed so that its creator holds no special privileges over other users.
Is Bitcoin used only by criminals and terrorists?
Bitcoin is purely digital — it has no physical form. Naturally, early adopters included highly computer-literate individuals and those seeking financial anonymity. Media coverage further cemented negative associations — notably linking Bitcoin to the Silk Road, an anonymous dark-web marketplace for illicit goods.
High-profile security breaches also damaged Bitcoin’s reputation — most notably the Mt. Gox exchange hack. However, it is false to claim Bitcoin is used exclusively by criminals. Its adoption is expanding globally: more businesses, e-commerce platforms, and service providers now accept Bitcoin as payment.
Why did the Bitcoin price rise so sharply?
Bitcoin is fully decentralized — unlinked to any country, central bank, or geopolitical context. Its initial price surge was driven primarily by speculation.
In March of that year, U.S. media widely reported that the Securities and Exchange Commission (SEC) would approve the first Bitcoin ETF. The SEC ultimately rejected the proposal, citing concerns over lack of transparency and regulation on Bitcoin exchanges and markets.
Nonetheless, speculative interest surged — pushing the BTC/USD rate to a new all-time high above $3,000, though it later dipped briefly to around $2,500.
How many Bitcoins can be ‘minted’?
Cryptocurrency is often called “digital gold.” There’s a clear analogy: like Earth’s finite gold reserves, Bitcoin supply is strictly capped. Satoshi Nakamoto designed the Bitcoin network to produce a maximum of 21 million Bitcoins. After that, the network will sustain itself through transaction fees.
Mining Bitcoin is computationally intensive. Mathematically, each Bitcoin block is solved by finding a specific cryptographic hash — one that begins with a defined number of leading zeros (e.g., 15). The network iterates through countless hash candidates until it finds a valid “beautiful” hash. When found, the block is declared solved, and newly minted coins are awarded to the miner who discovered it. All verified transactions for that period are recorded in the block before the network proceeds to the next.
This is a simplified explanation. In reality, the process is far more complex. Here’s a short video showing how a Bitcoin mining farm operates:
When will Bitcoin mining end?
Currently, solving one block across the entire network takes approximately 10 minutes, yielding a reward of 12.5 BTC. Crucially, block rewards halve roughly every four years — or about every 200,000 blocks. For example, before mid-2016, the reward was 50 BTC per block. By ~2140, the final Bitcoin will be mined and the reward will approach zero.
The Bitcoin network enforces strict emission timing and volume via a built-in parameter called difficulty. If network computing power increases and blocks are found faster than every 10 minutes, the system recalibrates difficulty every 2016 blocks — raising computational requirements to restore the 10-minute average.
Thus, Bitcoin self-regulates its issuance schedule — preventing deviations and safeguarding against potential collapse due to miner collusion.
Can Bitcoin become a global currency, replacing traditional money?
As noted, Bitcoin’s total supply is capped at 21 million. Is that enough?
To the uninitiated, it may seem small — but it isn’t.
Fiat currencies divide into 100 subunits (e.g., 1 USD = 100 cents). Bitcoin divides into 10 million units — named satoshi, after its creator. So, 1 BTC = 10 million satoshi. You’ll also see terms like microbitcoin (100 satoshi = 0.000001 BTC) and millibitcoin (100,000 satoshi = 0.001 BTC).
At present, ~16 million BTC exist — equivalent to 160 trillion satoshi. Global GDP stands at ~$70–80 trillion. Theoretically, Bitcoin’s divisible unit economy could replace all fiat money worldwide — a testament to Satoshi Nakamoto’s foresight.
Is solo Bitcoin mining profitable?
At first glance, mining seems like a golden opportunity: just connect your PC to the Bitcoin network and start earning. But reality is more complex.
Bitcoin runs on a peer-to-peer network: the more computing power added, the harder the math becomes. Early miners used CPUs and GPUs — even home PCs sufficed. It turned out GPUs were far more efficient, causing shortages of ATI Radeon cards.
Today, specialized ASIC chips dominate mining — drastically increasing network hash rate and difficulty.
Your chance of solving a block scales with your computing power — faster hardware solves hashes quicker. Internet speed also matters: once a miner finds a valid block, they must broadcast it across the network faster than competitors.
In practice, successful miners join pools — combining their hash power. Rewards are shared proportionally. This resembles a lottery pool: smaller but more frequent payouts, smoothing income over time.
Today, the top 10 mining pools generate ~90% of all blocks — with Chinese pools alone accounting for over 60%.
How to set up your own Bitcoin wallet?
Creating a Bitcoin wallet is simpler than it sounds. No ID, income proof, or personal verification is required.
For newcomers, choosing the right wallet type can be confusing. This video explains how Bitcoin wallets work and helps you select the optimal option:
To create a wallet, visit the official Bitcoin website. It supports Russian and offers a beginner-friendly interface.
On the homepage, click “Get Started with Bitcoin”.
You’ll be redirected to the beginner section, “New to Bitcoin,” where you’ll learn how to send, receive, and store Bitcoin — including setting up your own wallet.
Click “Choose your wallet” to view available options:
Wallet types include:
- Desktop wallet;
- Hardware wallet;
- Mobile wallet;
- Web wallet.
For step-by-step guidance, watch this video tutorial:
How to earn money with Bitcoin?
You can earn Bitcoin through several methods — ranked below from simplest to most complex.
Method #1: Solving CAPTCHAs, lotteries, and games
This requires minimal effort. Users earn tiny amounts of satoshi for simple online tasks. One user calculated it would take over 200 years to earn 1 BTC this way.
Method #2: Direct Bitcoin mining
This is more demanding — and falls into two categories:
1. Solo mining
Detailed guides are freely available online. You’ll need open-source mining software, a powerful (ideally high-end) computer, and significant time investment.
2. Cloud mining
You purchase hashing power from a remote mining farm. Returns scale with your investment. While accessible, don’t expect $100 to turn into $1 million in a year — realistic returns are modest. Review contract terms carefully before committing.
Beware of scams
The biggest risk in cloud mining is fraud. Many so-called mining companies operate Ponzi schemes: early payouts come from new investors’ funds — not actual mining profits. Eventually, they vanish — often with clients’ money — to tropical destinations.
If you pursue cloud mining, conduct thorough due diligence.
Method #3: Bitcoin trading
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This method is familiar to traders. Many Forex brokers offer BTC/USD trading via MetaTrader 4.
Technically, Bitcoin trading follows the same principles as forex: technical analysis works, standard indicators apply, and automated trading systems function normally.
The main difference is the absence of fundamental analysis — Bitcoin lacks a central bank, monetary policy, or direct ties to national economies. We explore nuances of Bitcoin exchange trading below.
How do news and macroeconomic data affect Bitcoin’s price?
Unlike traditional forex pairs, BTC/USD shows almost no reaction to U.S. macroeconomic releases (e.g., Non-Farm Payrolls). That’s logical — Bitcoin isn’t tied to any nation’s economy.
News, however, moves the market decisively. Monitor cryptocurrency headlines closely: major institutional investments signal bullish momentum — consider long positions. Conversely, exchange hacks or regulatory crackdowns often trigger sharp sell-offs.
Bitcoin news also has longer-lasting impact. While NFP causes an immediate EUR/USD spike, Bitcoin price reactions typically unfold over several days.
Does technical analysis work for BTC/USD trading?
Yes — classic technical analysis applies fully to Bitcoin. As noted, BTC/USD charts behave identically to other forex pairs: trends form, chart patterns emerge, and all standard indicators perform reliably.
Scalping and Bitcoin are incompatible
Scalping requires ultra-low spreads — but BTC/USD spreads are relatively wide (often >1 BTC). Therefore, Bitcoin trading is best suited to higher timeframes — H1 and above.
Frequent gaps in Bitcoin price action
Gaps in forex usually occur after weekends. Bitcoin trades 24/7 — yet price gaps still appear frequently on BTC/USD charts. The cause is low liquidity during sudden news events — leading to abrupt price jumps.
Which trading sessions suit Bitcoin best?
Bitcoin has no central issuer or geographic anchor. There’s no central bank printing coins or managing its value. Nor is it tied to any single economy. Consequently, trader activity isn’t session-dependent — sharp price moves can happen anytime.
Are there dedicated Bitcoin trading strategies?
Surprisingly, Bitcoin is often easier to trade than traditional currencies. Its price is less prone to manipulation — meaning fewer fakeouts, stop hunts, or artificial volatility common in forex. As a result, no specialized Bitcoin strategies exist — because they’re unnecessary.
Simple trend-following strategies work well for BTC/USD. Channel-based and breakout strategies also perform reliably — provided sound risk management is applied (as with any asset).
Should you start trading Bitcoin?
As shown, Bitcoin trading isn’t overly complex. Even beginners can analyze H1 and H4 charts effectively — and technical analysis rules apply perfectly. Just stay updated on news — and avoid greed.
Additionally, Bitcoin serves a valuable portfolio function: it exhibits near-zero correlation with traditional assets — making it ideal for portfolio diversification.
We hope this article demystifies Bitcoin — and that satoshi in your wallet steadily accumulate into full BTC.
FAQ
Is Bitcoin mining still profitable for individuals?
No — solo mining is no longer viable due to extreme difficulty, high electricity costs, and ASIC dominance. Pool mining or cloud services are alternatives, but returns are often marginal after expenses.
Do technical indicators work for Bitcoin trading?
Yes — standard tools like MACD, RSI, moving averages, and support/resistance levels work reliably on BTC/USD charts, especially on H1 and higher timeframes.
Can Bitcoin replace traditional money globally?
Theoretically yes — its fixed supply (21M BTC) and divisibility (down to 1 satoshi) support broad adoption. However, scalability, regulation, and volatility remain key barriers to widespread use as legal tender.
