If Bitcoin is new to you, you will probably Google the most searched phrase nowadays. You will find ''what is bitcoin?'' Bitcoin is a digital form of money. However, have you ever wondered what money is? Money is anything of value, or money is something that brings you anything of value. You are giving money to the shopkeeper you do your daily groceries from, and in exchange, he provides your groceries. There was a time when people used to carry gold with them, and there was no paper money. In those ages, gold was of value to them. Furthermore, there existed the barter system.
Revolution of paper money
People carry paper money instead and do all the exchange through them. They will not have to cut their gold into a hundred pieces to buy a cup of coffee. This money is called fiat and operates under the government's authorized system. This centralized system can generate as much money as they want. Nevertheless, what will backfire is the inflation produced in the market, and the value of that currency will erode. If your government makes money, you will have to pay more for your purchases. This authority of doubling money rests in the hands of the government only. People call it ''the double-spend problem.'' One cannot fold their money even through credit cards. Due to the centralized government keeps track of what you own and whatnot. The government can freeze your accounts and deny your excess anytime.
Concept of digital currency
Many people tried to invent digital money, but none successfully created digital money without a centralized authority before developing bitcoin in 2009. An online document came out, also known as ''whitepaper.'' The owner, Satoshi Nakamoto, suggested creating a decentralized system of digital currency which solves the problem of double-spending.
Difference between physical and digital currency
The difference between our digital money in banks and bitcoin is that you cannot know the information regarding transactions. As everything from a bank's system as you are not allowed access. However, you can sneak and peek into the design of bitcoin. It gives you transparent access to see several transactions. However, you cannot know who made the transaction and who owns the digital balance. Sneaking and peaking does not make the system of bitcoin insecure. The system is decentralized and manages all the information by only one method. Data is stored in thousands of computers, constantly copying and updating data. The techniques which keep copies of every single transaction are called blockchains. Therefore, nobody can hack a thousand computers participating in this system. Moreover, even if they know the number of transactions and the date.
Bitcoin: Your complete control Over Your Money
Bitcoin is a type of cryptocurrency which gives you complete control over your money. Unlike fiat money, you do not have to ask the bank to transfer your cash from your account. You do not need any permission to complete transactions, and you can do whatever you want with your money.
Bitcoin as an inflation controller
First, those who invest in digital currency sign up and solve complex puzzles to verify the blockchains. Then they have to continue doing so to mine money and receive rewards for doing so. If it is this simple to earn digital money, why would someone not solve math problems and puzzles to increase their balance? The answer is pretty basic. Satoshi designed the algorithm of bitcoin in a way to control inflation. The more problems people crack and the difficulty level of the problems are directly proportional. More people would join this plate form and be able to nail the puzzles, and they would be rewarded, but the difficulty level of the next question will increase with it.
Moreover, the probability is improbable that the same person who cracked a problem would translate the upcoming ones. Thus, it limits one person from earning much bitcoin. Like credit cards and debit cards for paper money, you can have your bitcoin credit cards to make transactions. You can do money transfers to buy tickets, book a hotel room, or order a pizza. Digital currency is getting accepted in many places, and it is not so far that cryptocurrency will be the primary way to exchange.
Future of Bitcoin
Although bitcoin is still a volatile currency in the market, it has made its grip on the ground. Various digital currencies came after it to take over and are all extinct. On the other hand, bitcoin is still present and making its worth. According to various successful entrepreneurs, the future of bitcoin is evident and bright. The future is digital, and people who embrace digital currency will be successful. People are switching and buying bitcoin as a long-term investment and asset. The best part about bitcoin is decentralized, as it cannot be stolen or hacked. People who own bitcoins are still worth millions and trading them for a better lifestyle and business purposes. In conclusion, Bitcoin is the future.
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