Bitcoin is a cryptocurrency and the thing about cryptocurrencies is that they are similar to traditional currencies in many ways. Cryptocurrencies are also entirely different in others. The mere fact that they are not based on any physical coins or notes that have ever existed shows this. We may be seeing some national currencies moving towards a digital-only future, but there are still some fundamental differences between these two types. Bitcoin and all cryptocurrencies do not have any physical coins or notes and never have done. They are also not controlled by any central bank or authority and are controlled by blockchain technology.
Bitcoin & It’s Unique Technology
Bitcoin was the world’s first cryptocurrency and paved the way for dozens more. It is a digital currency, as opposed to traditional money, which is mostly digital these days as well. How it works is a complicated technology but one that is very secure. The method by which funds enter the network is also the technology that enables security. Coins are released every ten minutes, and users can unlock them by solving mathematical problems. These same mathematical problems are the system used to encrypt every Bitcoin exchange. All of this is formulated in a peer to peer network, allowing a completely decentralized system that is near impossible to defraud.
As a currency, Bitcoin’s use is for the payment of goods and services. In its simplest form, you can easily arrange to send Bitcoin to another person for a prearranged transaction. Bitcoin is used to pay for something like an eBay purchase, as the eBay system doesn’t allow Bitcoin in its official checkout system, you would need to make an outside arrangement. The good news is that for owners of e-commerce stores, you can easily integrate Bitcoin into your online checkout. Even although you can’t spend Bitcoin everywhere there are certain workarounds that we can employ to increase the use of it. Take the example of Amazon while the shopping giant does not accept Bitcoin, many retailers who sell Amazon gift cards do.
Other than shopping, Bitcoin is often used for investment, and many buy and sell Bitcoin. As well as other cryptocurrencies by monitoring the market at the opportune time. Investing has become easier than ever as many banks are allowing cryptocurrency exchanges as part of your package. You could buy and sell coins directly from your online banking app, giving you the advantages of using Bitcoin but on a platform, you already know and trust.
In summary, Bitcoin is not universally accepted everywhere as many prominent platforms are not comfortable with a decentralized currency yet. Attitudes are slowly but surely changing, and we can see large firms such as Burger King, KFC, Microsoft, and more beginning to take Bitcoin. Once others see these success stories, surely more will follow.
This article has been contributed on behalf of Paxful. However, the information provided herein is not and is not intended to be, investment, financial, or other advice.