Technologies have dramatically altered people’s lives in the 21st century. We do a lot of things through the internet. Who would have believed a hundred years ago that today we could work, entertain and buy things just in a mouse click. Technologies serve to make our lives easier.
What is Bitcoin?If you have ever heard about Bitcoin you would probably asked yourself what it actually is? Is it a payment system or is it a new kind of money? Bitcoin is not complicated as it can seem at the first sight. Well, let’s sort the things out.
Bitcoin is a cryptocurrency based on mathematics. In simple words we can say that Bitcoin is the digital cash used in the internet. This currency doesn’t have paper equivalent or any other physical form and is fully virtual. Bitcoin has gained its popularity around the world due to its simplicity and usability. It is global and it blurs the borders between countries.
The difference from other currencies
The difference is that Bitcoin is not based on gold or raw materials like other international currencies. It is based on mathematics.
In contrast to conventional currency systems Bitcoin is not controlled by one central authority. Nobody owns or controls the bitcoin network. It would be right to say that it is managed by the users. Bitcoin is a technology that lets you send and receive any amount of the funds through the internet without middlemen.
Banks can produce more money to influence the economics by devaluing their currency. It cannot happen with Bitcoin as there is a limited amount of them. There can’t be produced more than 21 million of bitcoins.
There is a database which maintains all of the bitcoin transactions. It is called Blockchain. Let’s compare Blockchain with a book where all the actions with bitcoin are written down. Blockchain consists of blocks. They can be compared to the pages of the book. And all the transactions are notes on the pages. The transaction includes the sender’s address, the sum you send and the recipient’s address. The transaction is written in the block. And the blocks are inside the blockchain so that everybody can see it. It means that Bitcoin is a decentralized transparent system. Every single transaction is stored in blockchain.
Although everyone can see the bitcoin transactions it is impossible to see who is a person who uses it. One of the most attractive features of using Bitcoin is anonymity. As you can see in blockchain there are no names or any other private user’s data is given. No one can check what you do with bitcoins. You don’t have to provide any personal information. Your name, your email and other things are kept hidden from other people.
A lot of banks take large fees for international cash transfers. It is absolutely different with Bitcoin. All transactions are free from fees. Bitcoins are transferred within seconds through the web. The thing is that free transactions can take days while fees may speed up the whole process. The fees are too small and they help to protect the network from overloading.
When it comes to money either paper or virtual cash we care about safety. You don’t have to worry about it as Bitcoin cannot be stolen. You are in control of your money.
Another thing about Bitcoin that you should know is that it is irreversible. Once you sent the funds you cannot reverse them. It means that you should do business only with trustworthy organizations and people like in real life.
It is unquestionably true that the one who has the information rules the world. I hope now you have the general idea what is Bitcoin and you will benefit from using it.