What Is Bitcoin?

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what is bitcoin

Today’s market doesn’t see this as a new currency but Bitcoin, in the grand scheme is a new way of exchanging value between parties. Bitcoin was only created in 2009 but a person who used Satoshi Nakamoto as an alias. With Bitcoin, transactions are made without banks; no middlemen. Additionally, there are no fees and no requirement to give a real name. The fact is, merchants are starting to accept this new digital currency. You can buy things like electronic services, webhosting, or even order a pizza.

But Why Bitcoins?

Bitcoins can be used to make purchases anonymously. This is where much of the mystery and intrigue surrounds the cryptocurrency. On top of it being a form of international pay, bitcoins are no tied to a specific country so it makes them very easy and affordable when it comes to payments being processed. There’s also no regulation on it (yet). But small businesses may enjoy the use of bitcoin because there are no fees when compared to other forms of payment, like credit card processing.

How Can I Acquire Bitcoins?

In terms of dollars, one bitcoin is relatively expensive. This month the price of bitcoin reached all-time highs. But if you wanted to actually purchase a bitcoin, you would start with finding a marketplace called a “bitcoin exchange”. These “Exchanges” allow people to buy or sell bitcoins using multiple currencies. Bitcoins can also be sent between users by taking advantage of mobile apps or their computers. It’s pretty similar to simply sending cash.

What Comes With Owning Bitcoins?

Bitcoins are saved in what’s called a “digital wallet”. This wallet exists on a person’s computer or in the cloud. Think of this as a virtual bank account that gives a user the ability to both send and/or receive bitcoins. It also lets users pay for goods/services or save money. It also should be noted that bitcoin wallets are not insured at all.

The FDIC usually insures banks for instance. The dangers of these wallets are that they can be hacked based on them being in the cloud and some hosting companies have actually fled with their users’ bitcoins in hand. Wallets can also be accidentally deleted and viruses can even destroy them.

Also keep in mind that these bitcoin transactions are anonymous. Even though these are recorded in a log, which is public, the names of buyers and sellers are kept secret. Only wallet ID’s are given. For this and other reasons, this is much of the reason why bitcoin has become the currency of choice for people on the dark web or those looking to undertake ‘less than savory’ activities.

What Does The Future Hold For Bitcoin?

That’s the big question right now. As the prices of bitcoin and other cryptocurrencies fluctuate, the future of digital currency still remains up in the air as far as mainstream transactions. On top of this, Governments grow concerned because it also limits the control or lack there of for collecting taxes.

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