Something is changing the world of finance and it does not weigh anything in a literal sense. Just when we thought money was always going to be paper, there is, in fact, a new kind.
What are Bitcoins?
Founded by Satoshi Nakamoto, these revolutionary intangible entities are called bitcoins, the first decentralized digital currency that has made instant payments to anyone, anywhere in the world the easiest it has ever been. Bitcoin utilizes peer-to-peer technology in its operations without any central authority. Transactions and issuing money are collectively carried out by the network itself.
The conception of Bitcoin is upon the notion that money could be any object accepted and received as payment for products and services in a certain country or within a socioeconomic context. Bitcoin is one of the successfully pioneering implementations of a distributed crypto-currency. This is a type of digital currency that depends on cryptography in order for the creation and management of the currency.
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How Bitcoins Work
To have a clearer picture of how Bitcoins work, they are basically digital coins that you could send through the Internet. Bitcoin allows you to send money anywhere for less than a centavo per transaction without any outside authority controlling it- not a bank, not a party, not the government.
One of the advantages of Bitcoins is that they could be transferred online from person to person without having to go through a bank or any clearing house. Hence, it is a cheaper alternative when sending money because fees are much lower. Moreover, Bitcoins come without prerequisites, can be used anywhere in the world and your account could not be frozen.
The Bitcoin Miner is the free application used to manage and make transactions using the digital currency. The Bitcoin software is open source and anyone could possibly review the codes. Your Bitcoins are stored in a digital wallet and transferring them requires an electronic signature to ensure safety. You just have to wait a few minutes until a transaction is verified by a miner and it will be permanently and anonymously stored in the network.
What does the future look like for Bitcoins?
Bitcoins have received criticisms here and there, but it is apparent that is changing the way money works and the dynamics behind global markets and exchanges. More and more people have been using Bitcoins in their everyday lives such as buying online (video games, presents, books, computer parts, clothes, and even animals).
There are even currency exchanges that accept Bitcoins to be traded for several established currencies such as US Dollars, Euros, Yen, among others. Many small and start up businesses and people who work freelance have found good use for Bitcoins primarily because there is no acceptance fee, no charge backs and no additional fees.
The Internet age has definitely paved way for breakthroughs and Bitcoins has been the latest among them. The mechanics of investment, purchasing and selling will never be the same. Though many are unaware of the existence of Bitcoins, currently used by around 100,000 people, sooner or later they will change the face of finance entirely.
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