What is Bitcoin?
Bitcoin has brought new sensation in the modern cyber based economic world. It has vividly revolutionized the concept of money and commerce by providing fast, inexpensive, reliable and easy to access method for financial transactions. It’s the first ever internationally recognized digital money that has witnessed enormous increase in its reputation in the recent decade. People want to know more than ever about Bitcoin. They are curiously asking, searching, writing and discussing about Bitcoin.
To understand what Bitcoin actually is, we need to know a little about its history.
History of Bitcoin
Bitcoin was created in 2009 by an unknown person or persons named Satoshi Nakamoto. Nakamoto not only has created and originated the concept of Bitcoin but also has designed and deployed original reference implementation of Bitcoin. As part of implementation the first blockchain database was devised and the problem of double spending for online transactions was successfully resolved through blockchain technology.
How Bitcoin works?
Bitcoin is unlike anything which the world has witnessed or experienced before. It has been designed using combination of different hardware and software technologies. Without going into the detail of these technologies, you need to install Bitcoin Wallet on your computer to get started with. After this installation system generates the first Bitcoin address which can be disclosed to public so that people can pay you and vice versa.
The whole network of Bitcoin relies on the blockchain which can be considered as a shared public ledger. This public ledger holds all details of past transactions. A transaction in Bitcoin system can be defined as the value shifting from one Bitcoin Wallet to another. Each Bitcoin Wallet is assigned with a unique private key (i.e a number) to sign transactions and to provide mathematical proof to the network. Eventually these transactions are broadcasted on the entire network and then they are verified or confirmed by the system through a process called mining. To get verified these transactions strictly follow cryptography rules which prevent previous transactions to get modified or altered.
How Bitcoin is different from regular currencies?
Unlike regular currencies Bitcoin can’t be stolen from one another. It gives such promising security through cryptography. Bitcoin transactions are made directly from one node to another using peer to peer network and without involving any middle man or organization. Thus these transactions are inexpensive and fast. No one controls Bitcoin and hence no need to reveal private information to any organization or entity. This very feature makes Bitcoin more reliable as users become controllers of their own data. Bitcoin is not printed like dollars or any other regular money.
Future Prospects of Bitcoin
“It’s something we are looking at very carefully and will continue to look at,” Mnuchin said. “The first issue and the most important issue is to make sure that people can’t use bitcoin for illicit activities. So we want to make sure that you don’t have the dark web funded in bitcoins. And that’s something that is a concern of ours today.” – Yahoo Finance
Nothing about future of Bitcoin can be said with absolute certainty but it has been reported that the US Treasury has identified Bitcoin as virtual currency. Many well known companies like Microsoft, Dell, Amazon, Apple Expedia, Subway and Reddit have started to accept payments in Bitcoin. It has also been described as the first and the largest cryptocurrency with its total market value of approximately $19.2 billion as time of writing. These trends show bright prospects for Bitcoin future.