Bitcoin was created as virtual currency, it can exchanged and traded for any existing currency of any country. There is no central bank which would manage these coins - it’s completely online processing of new currency. There is no need to wait before a bank transfers money to another account in 2-3 business days - Bitcoins can be sent between accounts instantly and without delays. Let’s go into details and learn the ten most important things about the new currency.
a. What are Bitcoins?
The Bitcoin is a new virtual currency that represents a special value on the market. It can be traded or exchanged for another bank note. This value is fully digital, it has no real value on the financial market.
b. Who developed Bitcoins?
The concept of Bitcoins was developed by Satoshi Nakamoto. Nobody knows much details about this person, cause he would like to stay anonymously. He seems to come from Japan, but used different locations so it’s hard to say where he really comes from. He developed the Bitcoin system - the idea and the software - in 2009 and disappeared from the publicity in 2010.
c. What is so special about the Bitcoin system?
The Bitcoin system anonymize the payment market and makes all transactions invisible for anyone. When you buy Bitcoins, none is able to track you and places where you spend your coins. The developer created this currency as a peer-to-peer network - there is no central authority that would control transactions. Users exchange currencies and buy Bitcoins from each other without being controlled by any organization. In other way it’s the most anonymous payment service for today.
Bitcoin is getting popular from day to day. The main reason for this is the use of this currency from majority of Bittorrent, Usenet and other file-sharing services. Many companies connect the gateway to their sites to accept the new growing currency. Customers like to pay with it because it’s simple and anonymously. All Bittorrent related services, VPN providers, file-hosting companies and Usenet providers - just some merchants, who offer Bitcoin as payment method now.
d. How Bitcoins are used?
Bitcoins is digital currency and will be provided in form of a digital value. There exists an electronical wallet which you can keep on your computer or on a website online. You can have many wallets and Bit coin addresses where you receive money from other members.
Because nobody manages the transactions, it was difficult to create algorithm that would check if the user already spent his Bitcoins to other user to avoid double transaction for the same currency value. The developer solved this problem by showing all transactions in a public list. Once a transfer will be requested, the system connects to this list and checks if the digital currency was not used before.
The public list contains transaction ID and value only! The system keeps you anonymous because it doesn’t require from you any personal details like address, email, phone, name, etc. Compared to other virtual payment methods like PayPal it’s very secured way to store personal details.
e) Bitcoin facts
Bitcoins made a turnover of 207,929 million US dollars and there exist about 10.70 million Bitcoins. The system manages about 45,000 transactions daily.
Bitcoin is not a typical virtual currency that you can buy everywhere. It’s not that you go to any website, enter your credit card details and get coins. You have three possibilities of getting them: through „Mining“, using a currency exchange service or to provide services to others in return of Bitcoins.
„Mining“ is a process of extracting Bitcoins through a special software known as Bitcoin Miner. This software tries to find a new block in the chain of Bitcoin network and get some coins for you. If you find it then you will be rewarded with 50 Bitcoins.
You can spend Bitcoins in many ways: send it to any specific person, buy virtual goods online, make donations, pay bills, order any digital service and much more. All you need is to have a Bitcoin address of the person who should receive from your coins.
The grafic below shows the devlopment of a value for every Bitcoin in last years.
The Bitcoin system is a development everyone could only dream of. Millions of people using it to exchange currencies and pay for different services to keep their identity undercover. The value of one Bitcoin on the exchange market raised from $6 to $19 and continues growing.
Visa and Mastercard together with Paypal continue to make pressure for all Bittorrent, Usenet and other P2P services and make them loose their credit card acquiring. This is a way when they will loose their monopoly while systems like Bitcoin come to the market. About 40% of all Internet traffic will be generated by Bittorrent. Just imagine how much customers you can get if you will work with this industry.
We think Bitcoin is amazing development and wish the service all the best for the future!