What is Bitcoin?
Bitcoin is the the world’s most popular cryptocurrency. Cryptocurrency is a form of money that relies on cryptography and computer technology to secure its payments and usually the currency’s generation, maintenance and control is not controlled by a central authority as opposed to the “money” we see everywhere.
How is Bitcoin Controlled and Recorded?
Bitcoin is controlled and maintained in a distributed ledger called the blockchain which is basically a chain of transactions that is kept up to date by thousands of users running the same software on their computers.
This distributed consensus based ledger allows it to become the safest transaction recording method ever made. It’s secure and if someone tries to come up with an incorrect or duplicate transaction, the entire system rejects it.
In Simpler Terms
Now all of this is definitely confusing for some people as these are not common terms we are hearing. So, in simpler words: Bitcoin is a secure virtual currency which is based on a distributed record keeping technology (called blockchain) which is maintained by thousands of people around the world. Even you can help maintain it and that is the beauty of it.
Bitcoin and other cryptocurrencies have faced criticisms from the banking industry and other conventional economists but they are also receiving support.
Who is Accepting Bitcoin as Payment?
Major companies like Microsoft, Overstock, DISH Network and others have started accepting Bitcoin as payment and worldwide there are more than 100,000 channels that accept it as a secondary source of payment.
While it is still now available for direct spending, its reliability cannot be in doubt because you can cash it out through bitcoin exchanges, wallets and even bitcoin ATMs that are being placed around the world to help people use Bitcoin more easily. You just need to scan the code of your bitcoin wallet and then you are able to make a withdrawal. It is just that easy.
Is Bitcoin Useful?
Bitcoin is useful in many ways. Since it completely disregards international borders, payments can be made across countries with small transaction fees and high speed with no limit on the amount of money being transferred. This surely helps the big guys, but what about average consumer? Why would they be interested in what Bitcoin has to offer?
Well, the truth is that Bitcoin is a great investment for the long-term and more and more middle class people are investing in it.
Effects on the Economy
In a way, Bitcoin is helping the economy by making it borderless, uncontrolled by higher authorities and thus become freer than it has ever been in the history of mankind. This is the first time in our lifetimes that the concept of money has changed so drastically. This is not gold or paper money, it’s an entirely new way of sending and receiving ‘money’.
Nobody owns Bitcoin or makes its decisions for it. Only a complete consensus of all stakeholders can change Bitcoin and that involves thousands of miners, node operators around the world.
There are of course other cryptocurrencies as well where you can invest and mine for more but Bitcoin has undisputedly become the ‘dollar’ of the cryptocurrency world. Everyone wants to end up with more Bitcoin in the end. It’s become the base cryptocurrency. This is why most other cryptocurrencies (alt currencies) struggle to keep up with its growth and trading volume.
Bitcoin is considered a game changer for the future. It is eating away the share of normal “fiat currencies” like dollars, pounds and their debt-based structure. It offers an alternative that is not based on the trust in the countries’ monetary systems, which in most cases haven’t been audited in years.