Bitcoin is known to be the first digital cryptocurrency that has made its way into the mainstream. It is a total advanced currency that has gained huge popularity across the world. Individuals and businesses have started accepting bitcoin as a form of payment. The creator of bitcoin, Satoshi Nakamoto, tried to create a system that eliminates intermediaries’ needs.
Therefore, his creation led to the development of a system that is completely an electronic form of payment that is controlled by its users. With bitcoin, its users can purchase almost every single thing they wish to buy. You can know about Bitcoin Union and know more about its network.
How is Bitcoin traded?
Bitcoins are stored in a cryptocurrency wallet, and therefore bitcoin can only be exchanged using the cryptocurrency wallet. The bitcoin network transactions are recorded in a distributed public ledger where a network of computers communicates. Bitcoin trade is made where the users purchase or sold the bitcoins in the open market at a particular exchange rate. The coins can be traded or exchanged in bitcoin exchanges or ATMs.
Important points to know about Bitcoin
Bitcoin is a digital currency, and it can only be created through the process of mining. Bitcoin mining is a process where the miners, the specialized computers, tend to solve the multifaceted mathematical problems and get rewards for solving algorithms. Other than the ways of making bitcoins, mining is one of the processes from which miners tend to earn bitcoins for their efforts.
A large number of miners tend to compete with each other to solve the mathematical algorithms. They are given a time of 10 minutes to solve a block of transactions. 1 MB of transactions makes a block, which is first verified and then added into the blockchain. A miner who solves the complex algorithms first wins the bitcoins as a reward.
It is important to note that bitcoin transactions are irreversible. There is no exchange of sensitive personal information while carrying out the bitcoin transactions. The users are no required to provide their personal information to exchanges or save in bitcoin wallets. The identity of users remains mysterious in the bitcoin network. The exchange is carried out by knowing the bitcoin address, which is instantly recognizable.
Characteristics of Bitcoin that make it a great medium of exchange
Easy and simple to use
In banks, the users need to follow a long procedure to perform the transactions. The users also need to stand in lines, wait for their turn, and then wait for transactions to get completed in some days. In the Bitcoin network, the address can be made in seconds, no credit checks are required, and the users are charged no transaction fees.
It is easy and simple to set up a bitcoin wallet and complete the transactions. But before you perform a transaction, consider that transactions are irreversible and carry out the transactions carefully.
Decentralized currency
The only goal of the creator of bitcoin was to create a system free from banks and government involvement. The bitcoin network is created to provide businesses and individuals the benefit of carrying out the transactions without involving central authority. The creation of Satoshi Nakamoto turned out to be a tremendous decentralized currency that is appreciated by the whole world.
Anonymous
Banks tend to have every single information about their customers, including their way of handling money, their addresses, financial records, phone numbers, and more. Bitcoin is different as the wallet doesn’t require its users to share their personal information. The bitcoin network carries out all the transactions anonymously. It allows its users to hide their real identity and trade with bitcoins.
Users can keep their personal information safe and hide their cash flow. No banks or government bodies can track the cash flow or transactions of bitcoin users.
Transparent
Some people get confused between the feature anonymous and transparent. They think about how the network can be transparent if it allows its users to transact anonymously. They feature transparency means that the bitcoin network is based on blockchain. The blockchain does the work of verifying the bitcoin transactions and record them into the public shared ledger. This makes the network transparent, but along with it, no one can know your bitcoin address or your number of bitcoins.
