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Bitcoins and all you need to Know about them

Updated on June 1, 2016

Bitcoin has injected itself among many conversations about technology, finance and the internet and has come a long way from mysterious currency to broadly known medium of exchange.

If you want to explore about Bitcoin, here are answers to few questions that might just pop in your mind.

What is Bitcoin?

Bitcoin is a type of digital currency, which is online-only alternative form of currency. There is no middleman – that means no banks! The basic idea is that you can make payments without third-party like the government or bank. With no central authority, two people can transact freely anywhere in the world, with no fees or bank account. The idea behind Bitcoin is to take the power out of hands of the government and central bankers, who control the flow.

Do people even use Bitcoin?

Yes. Although Bitcoin is a new phenomenon, it is growing fast. Email lets us send mails anywhere for free; Skype lets us call anywhere for free, now there’s Bitcoin. It lets you send money anywhere online. Growing number of businesses are using Bitcoin, including brick and mortar businesses, online services such as WordPress and Reddit.

So far the skeptics are wrong in that Bitcoins can’t work:

The recent price trend clearly explains it all. Bitcoins will be eventually adopted in the same way the computers were adopted.

Who created Bitcoin?

No one knows for sure. Not conclusively. The idea was developed by Satoshi Nakamoto, who resides in complete anonymity. While the name sounds Japanese, the creator never provided any kind of personal detail.

He collaborated with people through online forums but never met anyone face-to-face. In 2010, he gradually reduced his involvement in the development of this digital currency.

However, many assume that the name is just the name of a group of people working on it together.

What is it about mining?

You must have speculated where Bitcoin comes from and gets into the transmission. The answer to this is that it gets mined into existence. No one is provided Bitcoin per se, you got to earn them and a little luck too.

There have been a lot of currencies that have been emerged in the years but this one has a lot new technology being used.

Consider bitcoin as a big ledger shared by all users: When you make transactions through bitcoin, it is recorded on the ledger. Programs then compete to confirm the transaction by cracking complex equations. The winner is rewarded with more bitcoins. Try not to get too wrapped up in that.

The history of transaction can also be tracked back to the point from where bitcoins were produced. People have already started using Bitcoins and but unless there is something that keeps a record of things, no-one would be able to get hold of things.

Why use Bitcoin?

Bitcoins are replacing the means of transferring value from one place to another. Wire transfer, cheques, and bank transfers usually suffer from delays and human error since there are different people involved in the process from both ends of transaction.

1. It is our generation

What we mean by this is that Bitcoin is made for internet generation. We are slowly moving past the days of carrying cash or credit card. The concept of Bitcoin goes further than the convenience of credit card users with a payment option that provides virtually immediate transaction time.

2. Bitcoins are cheap

The fees of Bitcoin as a method of payment is cheaper when compared to bank transfer or online transfer systems like PayPal. Why to pay so much to just move your hard earned money. Bitcoin transaction fees are negligible, or even free in some cases.

3. Its fast

Wire transfer, cheques and bank transfers usually suffer from delays and human err as different people are involved in the process. Bitcoin transactions are much faster and if the user goes for ‘zero confirmations’, it can be processed instantly.

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    • nabinkhadka profile image

      Nabin Khadka 2 years ago from Kathmandu, Nepal

      No money to PayPal. Saves a lot. Thanks for information. :-)