Back in October of 2008, a group of programmers under Satoshi Nakamoto released a cryptography mailing list that was entitled, Bitcoin. The Bitcoin system is quickly growing on a global basis. This is because it is being utilized more and more often on a day to day basis by people everywhere. While this new currency is somewhat complicated to understand, it can be simply broken down so that everyone can easily understand it and begin to use it. Visit the Bitcoin website for a detailed and distinct description of how the entire system works. Continue reading here for a simple breakdown of the new currency- Bitcoin.
This consensus network named Bitcoin is a payment system which enables the trade of digital money. It works on a peer to peer network that is decentralized and powered through the people that use it. The only dangerous part is that it has no central authority. It has been referred to as cash accessible online. The very first Bitcoin block was mined about 7 years ago in 2009. The biggest distinction between money and Bitcoin is that Bitcoin is not by any means real money. It is digital money. It is a virtual currency exchange.
There are many advantages to using Bitcoin. One of them being the freedom when you are paying for things. You can send and receive the bitcoins at any given time and any given place. Bank holidays are a bitter memory. There are no borders and no sense of bureaucracy. It truly allows the people using it to be in control of the money they are transferring. Another advantage is that you choose your own fees. Receiving bitcoins does not come with a fee. When you are spending, there are various options that you choose the amount of the fee in which you pay. In some cases, when you pay a higher fee there can be a faster confirmation rate for the transaction with the higher fee. The fees are not correlated to the amount of money transferred. You can spend thousands in bitcoins and pay the same fee that you would if you were paying to send a single
Another advantage is that there are fewer risks that merchants need to take. Transactions through bitcoin are secure. They are irreversible but secure. They do not require personal information from a customer. Merchants are then protected from losses that can occur from fraudulent acts. New markets are easily expandable and merchants can see that their net results are lower fee wise. They also experience fewer administrative losses and costs. The amount of security and control that bitcoin offers is just another advantage. Users will be able to hold complete control over their transactions. Merchants cannot force charges that went unnoticed. Payments are made without information that can be sensitive from the user and tied to the transaction they played. Identity theft is then highly protected against. Encryption backs up and protects the money of the user as well.
Why do people trust Bitcoin you ask? Well, there is a variety of reasons. Bitcoin does not require trust whatsoever. It is an open source system that is not centralized. Developers all over the world have access to the source codes which explains exactly how the entire system works. There is no reliance on a third party to complete transactions through Bitcoin. A cryptographic algorithm is what protects the system and it has been peer reviewed. To understand more as to how Bitcoin works, visit the website for further information and the algorithm behind the process. Check it out!