Bitcoin

Bitcoin is a digital form of currency that is created and usually held electronically. No single person has the power to control it. They are not printed like euros and dollars. They are produced by people. The difference between Bitcoin and other forms of currency is that it can be used to purchase items electronically. In this sense, it is like the conventional currencies like euros, dollars and yen which are also traded electronically.Bitcoin_euro
However, the thing that differentiates it most from other forms of currencies is that it is decentralized, unlike conventional currency. There is no single institution in the world that controls the Bitcoin network. This puts most people at ease in the buy bitcoin system since their money cannot be controlled by a large bank.
The idea of Bitcoin was brought about by a software developer who is known as Satoshi Nakamoto. It was an electronic payment system that is based on mathematical proof. The major reason was to come up with a currency that transferable electronically, not dependent on a central authority and that has very low fees of transaction.
Other forms of conventional currency are mainly based on gold or silver. In theory, you know that if a person hands over a dollar at a bank, he or she will get some gold in return even though it is not the case in practice. However, Bitcoin is not in any single way based on gold. It is based on mathematics.
All round the world, people are using software programs that are following a mathematical formula so as to produce bitcoins. The formula is freely available so that any single person can access it. The software itself is open source meaning that any person can look at it to ensure that it is doing what it is supposed to do.

Bitcoin has a number of characteristics that distinguishes it from other forms of currency. First of all, it is decentralized. It is not controlled by a central authority. Every single machine that deals with bitcoin transactions is part of the network, and all the machines work together as a whole. The advantage of this is that one central authority cannot interfere with the monetary policy or cause a meltdown.
Bitcoin is also quite easy to set up. Conventional banks will make you jump through hoops to do a simple thing like open a bank account. Setting up a merchant account to receive payment is another tedious process that is full of bureaucracy. However, you can set up a bitcoin address in a matter of seconds without any questions asked and without having to pay any fee.
Another characteristic feature of bitcoin is that it is anonymous and fully transparent. A user can hold many bitcoin addresses and they cannot be linked to physical addresses, names or any information that can be used to identify him or her. It stores every single detail of every transaction that happens in the network in a ledger known as the blockchain. As a result it is very difficult for any one user to make his or her activities opaque on the network.

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