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How To Check If Your Bitcoin Is Genuine
Cryptocurrency is still a new technology to most retail investors, and since it is not managed by a central authority finding reliable information and how to use the service can be hard for first-time users. Add to this the introduction of forked currencies like Bitcoin Cash, Bitcoin Gold, and it only adds further to the confusion.
Previous forms of money such as gold and fiat be it paper or digital can be counterfeited. There are many stories of fake gold and counterfeit paper money being used all over the world, while banks can be hacked and are hacked regularly.
So in a world where all forms of money can be compromised, and the legitimacy questioned, how does someone know if they have purchased a legitimate Bitcoin?
Is there a way to confirm if the Bitcoin you own is genuine? Yes, there is, and, it's a pretty elegant system.
Checking Bitcoins authenticity
To check the validity of your Bitcoin, all, you will need is a non-custodial method of storing your Bitcoin. The verification could be through the help of a Hot Wallet or Cold storage as it's best to use a wallet that you have full access to and control. You may use a custodial wallet like one sitting on an exchange as it will perform the same validation, but for this case, I would recommend using one you own.
When you perform a transaction by purchasing Bitcoin and sending it to your wallet, this could be from an exchange, a company, a friend or any Bitcoin wallet also on the network.
If the network confirms the transaction with six confirmed transactions and the money is reflected in your wallet, then it is a legitimate Bitcoin. There is no need to check it after that, only a legitimately minted Bitcoin can be transferred via the network and confirmed by the miners.
Why can't Bitcoin be faked?
There is no way to get a fake Bitcoin because Bitcoins are a result of a calculation on the blockchain's data. Your wallet reads the blockchain, to find out how many coins you have.
Once transactions are confirmed on the blockchain, the bitcoins have left the originating wallet, and belong to you. Blockchain is something that cannot be altered easily.
That's why Bitcoin is called "trustless". The blockchain removes any need for an intermediary to guarantee the transaction.
How to check funds from wallets?
If you want to double-check funds you can use a tool called a block explorer. This tool is open to anyone so you can check wallets you have the addresses to so you can check wallets you own or wallets owned by people you do business with or plan to trade with in the future. All you need to do is enter the Bitcoin public address (the one you were paid into) into a public blockchain browser such as:
That will show you the relevant entries in the global shared Bitcoin ledger, which confirms that you, as the holder of the private key for that address, are the owner of those funds.
If you would like to know more about digital assets or would like to market your digital asset company then don’t be shy we’re happy to assist. Simply contact us
Are you looking to promote your business?
South African finance business owners can create your free business listing on nichemarket. The more information you provide about your business, the easier it will be for your customers to find you online. Registering with nichemarket is easy; all you will need to do is head over to our sign up form and follow the instructions.
If you require a more detailed guide on how to create your profile or your listing, then we highly recommend you check out the following articles.
If you enjoyed this post and have a little extra time to dive deeper down the rabbit hole, why not check out the following posts on cryptocurrency and blockchain.
- Why Blockchain and Cryptocurrency Is The Future Of Money
- 24 Ways To Earn Cryptocurrency
- How To Pay Tax On Cryptocurrency In South Africa
- How To Buy Bitcoin In South Africa
- Why Does Your Bitcoin Wallet Address Keep Changing?
Disclaimer: This article should not be taken as, and is not intended to provide any investment advice and is for educational purposes only. As of the time posting the writers may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency as all investments contain risk.