What is Bitcoin and how does it work ?

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Bitcoin is a digital currency used in order to transfer money digitally with no need for a third party like a bank or government.

It’s completely anonymous, meaning that users can stay true to their privacy without fear of the government or other parties hacking and gaining access to their private information. Additionally, it’s decentralized which means there are no central points of failure and there is no risk of catastrophic loss like what happened during the financial crisis.


Bitcoin is the currency that transfers money instantly and securely all over the world. The system exists within a massive peer-to-peer network where everyone who has a bitcoin wallet can send or receive funds. Bitcoins are transferred automatically from one person to another without the need for an intermediary like a third party or bank.

Bitcoin was invented in 2009 by an unknown person using the alias Satoshi Nakamoto. Shortly after its invention, Satoshi released an open source code that allowed anyone to mine bitcoins with their computers.

Why should you care about bitcoin?

There are several advantages in using bitcoins. First, it has no transaction fees. There is no waiting period for fiat currency or bank transfers. It’s a simple and fast way to send money all over the world.
Not only is bitcoin easy and simple to send, but it’s also safer than other payment methods because there are no middlemen to exploit sensitive information like credit card numbers, security code etc. Additionally, it can be sent without disclosing the identity of the sender or receiver of the funds.
Bitcoin, as a currency, is less volatile and more predictable than other forms of currency. It’s often referred to as a store of value and is a great alternative to fiat money.

The Value of Bitcoin


The value of bitcoins are determined by supply and demand with the exchange rate between one unit of bitcoin and another fiat currency such as the U.S Dollar or Euros. The price on any given day, at any given time, depends on supply and demand which in turn affect its price.

The risks of investing in Bitcoin

Bitcoins are new and there are risks involved with investing. The currency has a high level of volatility at times, which can be both good and bad. On one hand, when it’s low, It can be used as a currency to purchase goods and services around the world or as an investment for those looking to cash in on the future potential.

Whenever It goes up in price it can cause some concern for those who have made investments due to its excessive fluctuations in value.

Furthermore, like any other currency, It is subject to inflation. Over time the value of one bitcoins will rise as others will need it and want to buy bitcoins. However, bitcoins are limited in supply which could eventually lead to deflation if more isn’t produced.

Finally, there are risks associated with the digital wallet and its security. Bitcoins stored in digital wallets may be susceptible to various threats like an online attack or physical thieves, who steal your wallet’s contents.

How to invest in Bitcoins safely and securely?


There are a number of ways to invest in Bitcoin. Here are some of the most popular ways:

Buy Bitcoins through a Buying Platform : There are many platforms that allow users to purchase bitcoins with credit cards or via bank transfer. They might offer a better price and allow you to monitor your investment since you’re not leaving your money on an unregulated exchange such as Coinbase.

There are many platforms that allow users to purchase bitcoins with credit cards or via bank transfer. The easiest way to get a hold of bitcoins is through bitcoin ATMS. With the current ATMs available, these machines allow the user to insert cash in exchange for bitcoin.

What are the pros and cons of investing in Bitcoin?


Pros


The value of Bitcoin is increasing every day.
Bitcoin’s exchange rate to the U.S Dollar is much more stable than most other currencies.
Anyone with a computer can mine bitcoins, which means anyone can create new Bitcoins and invest in them at any time.

Cons


There is no established value for Bitcoin since it’s relatively new and unregulated, so it’s difficult to determine how much one bitcoin will be worth in the future.
While convenient, bitcoin ATMs may not be available in your area.
Not all bitcoin transactions are completed successfully.
No one controls Bitcoin, so you can never be 100% certain who’s behind Bitcoin or what they’ll do to it next.
Bitcoin’s Extreme Volatility: As a new form of currency, the values for Bitcoin are extremely volatile and unpredictable. This makes investing in them a riskier decision than investing in fiat currency.

Conclusion

Bitcoin offers many advantages over other payment systems like the U.S dollar and the Euro. However, there are risks involved as well. One of the biggest challenges to using bitcoins is securing your digital wallet and storing your bitcoins safely at home.

About the author

Anwesha Mukherjee

Anwesha Mukherjee is a Digital Media Publisher and freelance writer. She has been working in the publishing industry for over 6 years now, holding various positions at different publishing houses across India. Her work experience includes managing marketing campaigns, content development and website maintenance for various industries including healthcare, IT, finance and education.

She also offers ghostwriting services to help aspiring authors get their book published while maintaining creative control over the project.

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Anwesha Mukherjee

Anwesha Mukherjee is a Digital Media Publisher and freelance writer. She has been working in the publishing industry for over 6 years now, holding various positions at different publishing houses across India. Her work experience includes managing marketing campaigns, content development and website maintenance for various industries including healthcare, IT, finance and education.

She also offers ghostwriting services to help aspiring authors get their book published while maintaining creative control over the project.

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Mars Blogging launched in January 2019. Mars Blogging is an independent website publishing news related to business and major technology developments across the world.

The website also strives to create one of the most comprehensive financial glossaries online.

Mars Blogging is based in United States of America. The company also has offices in Louisiana, United States.

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