Bitcoin has revolutionized the transaction system and the mode of an exchange over the years. It has no physical presence but has a digital presence. The best part of this currency is it never works on the principles and the policies made by the banking system of the world. It is free from any sort of government intervention and regulations.
Now to know it more clearly you need to know What is Bitcoin? There are several aspects of Bitcoin you need to know. Therefore, it is very important that the basics of it must be clear in your mind.
What Is Bitcoin?
The most popular cryptocurrency in the world is Bitcoin. In 2009 Satoshi Nakamoto and his alias created it. There are no middlemen involved in the transaction process of bitcoin. You can use bitcoin to purchase anything you want from any part of the world as it is a digital currency. It has no physical existence. Like paper currency, the value of bitcoin does not change from one country to another. It has a uniform value all over the world.
Brief History of Bitcoin
We all know that Bitcoin is the first form of cryptocurrency. The reality is before the existence of Bitcoin many attempts have been made to create cryptocurrencies since 1998. There are many previous attempts have been made to create the cryptocurrencies that are secured by encryptions. The B-Money and Bit Gold are the two cryptocurrencies that attempted to make the first cryptocurrency in the world, but it cannot be developed successfully.
In 2009 Satoshi Nakamoto invented bitcoin that is made by the mining process using Blockchain technology. It was the first of its kind to form the decentralized form of currency. Initially, it has no selling value as it was mined later from 2010 the bitcoin has its own monetary value using which it can be sold. In 2009 it was never traded so when in 2010 first it was sold then the monetary value of bitcoin was first coming into existence.
Characteristics of Bitcoin
If you want to know What is Bitcoin? then you must know its characteristics properly. It will help you to get complete information about bitcoin and about its existence. There are several factors that you need to consider when you want to know about bitcoin.
Bitcoin is a decentralized form of currency. There is no existence of banks or any financial regulatory authority between bitcoin and its users. It is designed in such a manner that every machine and the business that is involved in the mining and the transaction process of Bitcoin becomes a part of the vast network.
If any part of the network goes down, then also the money will keep on moving. The control of the financial and regulatory bodies are not applicable here to record the details of every transaction. Blockchain Technology is a digital public ledger that records the details of every transaction.
Today, all the currencies relate to the banks and other governing authorities. These all currencies are virtually connected with the banks where your address, phone number, and all your buying habits are tracked by the banks. Bitcoin is different from this model of the transaction as all your personal information is not shared in the Bitcoin wallet and you can keep your personal information intact.
There are some people who do not like their information to get tracked or monitored by any other authority. For them, Bitcoin is the best solution. There are some arguments in this regard that due to non-traceability of the transaction may lead to transactions of unwanted items that are harmful to society.
The anonymous character of the Bitcoin is relative as every single transaction that you have made using the bitcoins is recorded in the Blockchain technology. If anyone can study your Public ledger then they can easily tell you the details of each of your transactions. If anyone has your wallet address, then they can tell every detail of your transactions. Moreover, tracing the Bitcoin address of a person is still impossible.
If you want to maintain the opaqueness of your transactions, then you must have multiple addresses and you must not transfer massive amounts of money to a single wallet. Apart from these the transactions in Bitcoin are quite transparent in nature as you can record all the transaction details using Blockchain Technology.
You can easily transfer money from your wallet to another person’s wallet within a few minutes from any part of the world. In the case of normal bank transfers, it will take several days and sometimes even months to complete the transaction process from one country to another.
Hence, it makes the transaction process faster and smoother than before. You need not wait in a queue to make your transaction as the money is transferred digitally from one place to another.
Once you send your Bitcoin money to someone you cannot get it back unless that person sends you back that money. Hence, it reflects the authenticity of the Bitcoin as you cannot get scammed in a bitcoin trading business as no one can say that you have not sent your money once you send it to them. Thus, the chances of forgery in the Bitcoin trading business are low and better to say negligible.
Hence if you want to know more about Bitcoin in detail then you must understand its pros and cons to get a better insight into it. There are multiple factors traders and investors in Bitcoin must know before they start trading in Bitcoin. There are several issues that are in doubt regarding bitcoin. Most importantly the fluctuations in the Bitcoin prices are very uneven and unpredictable. You never know when its prices will creep up or it will go down. You need to stay vigilant in this regard.
Pros and Cons About Bitcoin
There are several pros and cons of bitcoin that you must consider while you want to trade in Bitcoin. There are several factors that you need to consider if you want to do trading in Bitcoin. Therefore, let’s explore the pros and cons of Bitcoin to get a better insight into it.
Pros Of Bitcoin
There are several advantages of using a Bitcoin that its user must know.
Bitcoin is developed to provide its users the complete freedom of transaction. There are no central governing authorities in between for controlling the process of transactions. No transaction fees the user has to pay to the authority for making the transactions in the Bitcoin. You can easily buy anything you want using bitcoin. In many countries taxes on Bitcoin are not even charged hence it is the most feasible currency that you can use for the purchase of your items. You need not worry much.
2. High Portability
Bitcoin is digital money you can easily make your transactions from any part of the world at any point in time. It is easy to use and carry from one place to another. Bitcoin is a digital currency hence any amount of money can be carried in the flash drive or it can be stored in the online mode. Just you need to scan the QR code to receive or send any money from one place to another. You need not pay extra fees or charges to the government authorities for making the transactions.
3. No PCI Is Required
PCI means the Payment Card Industry it involves debit cards, credit cards, POS, and other modes of transactions. The cardholder has to maintain several strict rules and regulations of the banks. In the case of Bitcoin, you need not comply with the PCI standards. There are certain private organizations that restrict transactions with PCI cards. In the case of Bitcoin, you can venture into any industry you wish. You need not seek any further permission for that.
4. Safety and Control
You can view the status of each transaction that you made using Bitcoin. Blockchain Technology keeps the record of every transaction you made using what is cryptocurrency. It keeps the backup copies in its encryption for every transaction. Your identity and personal information will not be disclosed to anyone while you make the transactions using the Bitcoin.
Cons of Bitcoin
If you want to know what is Bitcoin? then you must be aware of various demerits of Bitcoin in the proper manner.
1. Legal Questions
The legal status of Bitcoin is a matter of question in many countries of the world. Better to say many countries of the world accept it as a legal currency while other countries have banned Bitcoin and Outlawed it. Hence, depending on the country you need to think of trading in Bitcoins.
2. Level of Recognition
The level of recognition for Bitcoin varies from country to country. In some countries, it is accepted as a medium of exchange while in some countries it is rejected. Hence, there is no stable recognition for Bitcoin as a currency that you need to consider while using it.
The price fluctuations in the case of Bitcoin is very volatile. You never know when it’s price will rise and when its price will fall. Hence you need to have the correct market idea before you want to invest your money in Bitcoins.
4. Lost Keys
An alphanumeric password is there in the Bitcoin Key to open the Bitcoin wallet. If You lose these keys, then you cannot make any transactions easily. You need to be very careful regarding this fact.
Hence, in the article, I have tried to answer all your queries regarding what is Bitcoin? About its features, pros, and cons. Before you start trading in Bitcoins you must possess the basic ideas about it clearly. Otherwise, you will lose lots of your money on it.