Bitcoin happens to be the oldest and most popular cryptocurrency in the world. Beginning with the basics, there are three major aspects of Bitcoin; its origin, the technology behind it (or how it works) and the utility of Bitcoin as money. It was launched on 3rd January 2009 by the mysterious developer or group of developers called “Satoshi Nakamoto”.
The Bitcoin network is not governed by a central authority. You don’t need a middleman to carry out financial transactions; moreover, bitcoins are stored electronically, which is why Bitcoin was launched as a “Peer-to-Peer Electronic Cash System”. Bitcoin possesses multiple qualities that distinguish it from traditional fiat currencies.
It does not exist physically; it is mined independently by people that have the resources to do so; it is stored and maintained using strong cryptographic keys (or passwords), which is why it is called a ‘cryptocurrency’. It runs on a distributed ledger technology called blockchain that records every transaction on the network.
Since its inception, Bitcoin has come a long way, steadily rising from its initial price of $0.30 in 2011 to its all-time high of $19,783.06 in 2017. However, the Bitcoin price depends on a number of factors, most of which cannot be clearly defined by anyone. Below are Bitcoin’s significant price movements since its creation:
Bitcoins received acceptance in 2011 from an international non-profit digital rights group called the Electronic Frontier Foundation, who later stopped accepting Bitcoins due to regulatory uncertainty. In 2012, the Bitcoin Foundation was launched, with more than 1000 merchants accepting it as a payment service.
In February 2013, the price of one Bitcoin rose to $22. A cryptocurrency exchange in the US got an endorsement in late 2014 from the US Commodity Futures Trading Commission (CFTC) regarding the listing of an OTC (Over the Counter) product that would be based on the price of Bitcoin, marking the first instance of a Bitcoin financial product being approved.
These two years were a disaster for bitcoins as multiple cryptocurrency exchanges were hacked. However, this period had several positives, of them being the deployment of around 700 Bitcoin ATMs across the world to help people access their Bitcoins conveniently.
The number of merchants and businesses accepting BTC as payment continued to rise exponentially. In December 2017, as the Bitcoin price increased astronomically to its all-time high of $20,000, Bitcoin started gaining further mainstream attention. The rate of transactions increased threefold. However, in 2018, BTC started a bearish run that saw it drop to $3,000 by the start of 2019.
By mid-2019, the price of Bitcoin had surged to $13,000 again, before retracing back to the mid-6,000s and 7-000s. 2019 saw the launch of Bakkt, the Bitcoin futures exchange. Late 2019 and early 2020 also saw the launch of Bakkt Options and CME Options respectively. Bitcoin is being widely adopted as currency as time goes on. The Bitcoin price has dropped to $4,800 since the turn of the last decade, but the future of BTC looks as promising as ever.
Bitcoin as a payment system has some significant advantages over traditional fiat currency. They are as follows:
● Traders get freedom from peer-to-peer trading and there are no interruptions from third parties such as the government, banks and other financial institutions.
● No sales tax is payable on Bitcoin transactions.
● Transaction fees are comparatively lower than standard wire transfers.
● International Bitcoin transactions are massively quick as compared to standard bank transfers.
Bitcoin is all about its underlying technology called ‘blockchain’ – a secure, time-efficient and decentralized record-keeping ledger system. It makes Bitcoin an incredibly powerful payment tool, specifically in the unbanked and underbanked regions.
However, the market sets its price. As it is listed on almost every cryptocurrency exchange platform, the price varies according to its selling price on each of them.
Secondly, market liquidity also impacts the price of bitcoins to a great extent. Political events and technological developments have varying degrees of influence over the Bitcoin price. One needs to be extremely careful while investing in bitcoins as its price can be very volatile and many people do regard it as a high-risk asset.
For novices in the crypto universe, Bitcoin is almost always the first entry point, the “gateway drug” that leads to one of the biggest technological innovations of all time. With a market capitalization of $157 billion and a name that has become almost synonymous with the concept of cryptocurrency, Bitcoin is probably the biggest phenomenon in finance since the invention of paper money.
The legality of Bitcoin for you depends on where you are in the world. Bitcoin is not legal in all countries; there are countries where you could be punished for buying bitcoins with your own money or for even holding bitcoins. However, the level of anonymity afforded by BTC is enough to keep you secure. Do your research on the legality of Bitcoin in your country before you decide to invest in the coin.
Bitcoin has the biggest market capitalization among all cryptocurrencies. It goes without saying that Bitcoin is almost always the first option on every cryptocurrency exchange, and several other cryptocurrencies can actually only be traded against BTC. If you’d like to purchase BTC or get introduced to cryptocurrency for whatever reason, here are a few websites you can check out:
● FreeBitco.in: FreeBitco.in is a Bitcoin faucet where you can earn up to $200 in Free BTC every hour, doing nothing but solving simple captchas. The website has distributed more than $1.5 billion in BTC to users since its launch in 2013. Earning BTC at FreeBitco.in is easy, and withdrawing your winnings is even easier.
● Coinbase: It is a cryptocurrency exchange platform based out of California and it currently operates in more than 32 countries worldwide. It is one of the most secure platforms in the world for crypto enthusiasts looking to buy or trade bitcoins and other cryptocurrencies such as Ethereum, Litecoin, Bitcoin Cash, etc.
● Coinmama: Coinmama is a leading cryptocurrency exchange based out of Israel. It lets you buy bitcoins easily using your credit or debit card. It has an affiliate program that pays you 15% for every transaction your referral makes.
Investors used to assume that Bitcoin might take several years to make a global impact. They never did believe in the digital currency because of its prevalent use on the dark web and it primarily existing on the internet, which is a haven for hackers and cyber attacks.
However, the Bitcoin network is run by thousands of computers (nodes) and every block in the blockchain is secured with strong cryptography to protect it from theft. As a result, in recent years, bitcoin has gained in value significantly and has become the most trusted crypto in the world. The developments in Bitcoin are driving it further and further towards global adoption, and it is absolutely the right time to invest in BTC.
No one controls the Bitcoin network, and that’s the best part. The blockchain it is based on is entirely public, making transactions completely transparent to anyone. There’s no central authority that controls the Bitcoin network; the network belongs to every computer or node on the network that verifies every single transaction and maintains the public ledger that is the underlying blockchain.
Miners or traders that are selected through the Proof-of-Work system validate all the transactions and store/record those transactions in the Blockchain. Mining a Bitcoin has a high degree of difficulty and requires dedicated, expensive machinery and a high amount of energy to do so. Every 10 minutes, a new block is created on the blockchain.
Even the developers behind the Bitcoin network don’t control it. They introduce updates and innovations in accordance with the miner and user consensus, constantly making the network better.
A number of financial forecasters are expecting a huge transformation within the crypto space in coming years. According to them, the Bitcoin payment system is in need of faster transaction speeds and a higher degree of privacy. Developers are constantly working to make Bitcoin better and more suitable for global adoption as time goes on.
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