Bitcoin is the first cryptocurrency created in 2008 by unknown person (or a group of persons) under the pseudonym Satoshi Nakamoto. Blockchain technology which serves as a basis for Bitcoin cryptocurrency allows to transfer money between the parties without intermediaries (such as the Banks) and much lower cost of remittances than the Bank's fee. But the main excitement about it is caused by a chance to make a fortune by investing to Bitcoin, since this tool has been growing in price since its emergence and the experts forecast a bright future for Bitcoin and blockchain technology.
Advantages Of Bitcoin
The use of Bitcoin enables to make payments anonymously and cheaply worldwide, as it is not bound to any country and is not regulated by any government; the money in your Bitcoin wallet cannot be frozen or withdrawn by third parties. Only you have access to your money.
The differences of Bitcoin from conventional fiat electronic money
Let's talk about the main differences of Bitcoin from traditional money in simple words.
Information on all transactions over the whole history is stored by all members of the network on their computers all the time. While making a money transfer, you add a new entry (block) in your repository (blockchain) and information of the new block is immediately synchronized among all users. Authenticity of the new blocks is verified by so-called miners; these are computers with large computational capacity which, with the help of special software, mathematical functions, and cryptography confirm the correctness of transactions and receive a reward for it. This is how new bitcoins are issued.
2. Limited issue
Bitcoin is the open source software designed in a way that the maximal amount of bitcoins which can be issued makes 21 million coins. This fact makes Bitcoin even more attractive tool for investors, since the demand for bitcoin will grow, while the number of coins is limited, which will significantly increase bitcoin value.
Unlike traditional electronic money where the payer has to pass verification procedure, Bitcoin users can act semi-anonymously. What does it mean? Since Bitcoin has no central administrator or verifier, hence there is no need to verify the person's identity to make a translation.
In practice, every user, if necessary, can be identified by the wallet address and the complete transparency of blockchain makes all transactions of any wallet visible to anyone. In addition, most exchanges require passing verification procedure prior to allowing you to buy or sell Bitcoin.
Bitcoin transaction, unlike fiat currencies, cannot be cancelled once the transfer information is recorded in blockchain and at least 1 hour passes; your actions cannot be cancelled.
The smallest unit of bitcoin is called satoshi, after the creator (Satoshi Nakamoto) and makes 0.00000001 of bitcoin (one to a hundred million); currently it makes one-hundredth of a cent. This allows you to transfer very small amounts, which cannot be done with traditional money.
6. Versatility and rate
You can transfer money within several minutes; location of recipient - whether it is a next room or the other corner of the world - does not matter for the system.
Cryptographic system public key protects your funds securely against unauthorized access; only the private key owner can control the money.
8. No obligations
To open a Bitcoin account you don't have to go anywhere, fill and sign any papers, etc. All you need to do is to download the software, generate a new wallet, and start receiving and sending money.
9. Easy integration
Bitcoin can be easily integrated into your business to receive payment for your goods or services; thus, there is no need to register a company officially and pay taxes.
10. Bright prospects
The above mentioned advantages make Bitcoin a very attractive asset, which promotes the inflow of new investors and positively affects the price of bitcoin which is constantly growing.
Watch a short video on Bitcoin:
Past, present, and future of Bitcoin
This can be called a small miracle, but Bitcoin was born in 2008, right after a famous move - "Occupy Wall Street" during which the demonstrators accused the large banks of misuse of the borrowed money, cheating the customers, and charging enormous fees. People simply got tired of debts they had to live with. Coincidence? I don't think so.
Bitcoin was invented by so-called crypto-punks as an alternative to modern banking system - to get rid of its flaws and drawbacks.
In 2010, a man called Laszlo Hanyecz decided to prove the value of bitcoin to bitcoin community and posted a message on the forum and offered 10.000 bitcoin (which made about $30 at that time) to a person who would bring him 2 pizzas. Transaction was performed and May 22, 2010, the day when Laszlo Hanyecz got his pizzas, went down in history as Bitcoin Pizza Day.
To date, you can buy almost anything with Bitcoin. It seems no one contests the value of the new currency.
No one knows what will happen to bitcoin tomorrow, but the fact it cannot be prohibited or regulated provides us with a very good reason to believe we are living the era of essential changes in the financial sector, and governments have no choice but to accept the new currency (like Japan has done it, for example), or to remain blind as if nothing was happening.