Nothing trended more than Bitcoin in 2017. It is however surprising that two years down the line, a generous number of people are still not well versed with the terminology. If you are among this huge crowd, consider yourself lucky to have come across this piece. This is because this article, other than enlightening you about what Bitcoin is in the simplest way possible, goes ahead to show you how Bitcoin is generated and further provides you with its merits as well as its demerits. Sounds amazing, right? Well, without wasting any second, let's get straight into it.
What is Bitcoin?
Bitcoin is simply a virtual currency that is not controlled or owned by intermediaries like the banks. You’ll realise that some people refer to it as a cryptocurrency. Yes, they are correct because Bitcoin is a form of electronic cash that can be sent from one user to the next using a peer-to-peer Bitcoin network.
How did Bitcoin begin?
If you did not understand a thing from the above definition, you would perhaps want to grasp something about its origin as this will make the understanding easier. Although there is still no affirmed history of Bitcoin, reports has it that it emerged in 2008, almost immediately after big banks were accused of misusing their client's money by Occupy Wall Street. Therefore, its aim was to eliminate the intermediaries (banks) in an attempt to protect the money of the people, and what other way to do it other than through the introduction of a virtual currency (Bitcoin) in such a digitalized era?
How it works
It’s not anything complex. Trading with Bitcoins entails downloading a certain app called the digital wallet. Every digital wallet comprises of a private key which is basically a username and a password. With this, it is easy to send money from one digital wallet to the next, and each transaction is stored in what is known as the blockchain.
There are various advantages that you get to enjoy while trading with Bitcoins
You are most likely aware that in all the banks, regionally and globally, you can only send money up to a certain limit. This can sometimes be inconvenient, especially if you have to send large sums of money to another individual or company as this will mean double transaction and double fee. With Bitcoin, however, there is no limit to the amount of money you can send or the
amount of cash that you can receive.
Close to minimal transaction fees
No bank allows people to conduct a transaction without charging a certain amount of money. For Bitcoin, fortunately, this is not the case as no transactions are involved unless in some few instances and the fees are normally quite minimal.
How long do you take to send an email? Yes, that’s the exact time Bitcoin transactions take to go through, making it quite efficient compared to other forms of exchange.
Not controlled by the government
Another top advantage with Bitcoin is that government entities don't manage it. Therefore, abrupt changes that don't favour the users can't take place overnight.
Protection from hacking and credit card fraud
This is perhaps the best advantages of all. Bitcoin users are not allowed to share their secret details like identification cards on the system. As a result, the users stay protected from untrustworthy merchants.
Although Bitcoin enjoys a chain of merits, it also has some disadvantages.
It is almost a decade since Bitcoin became introduced into the market. However, most businesses have not accepted its use yet, which is quite a big setback.
Possible future interference
Bitcoin is in the next couple of years going to become a big thing. Perhaps, this is why it is called the future of money. With that, there is a possibility of governments interfering with its mode of operation, thereby lessening the advantages that users are enjoying today.
With this simple, yet enriched content, we hope that you now have an idea of what Bitcoin for money is, as well as the advantages and disadvantages that it comes with.