Since the start of the global financial crisis, there has been talk about alternative currencies or “cryptocurrencies” such as Bitcoin. This is a fairly new concept, which has gained a lot of popularity. Though it’s not perfect, it can be considered as one of the best alternatives to traditional currency. What is Bitcoin?
At its core, Bitcoin is a virtual currency. It is created and managed through the software, known as a “miner”. It is not controlled by any government. This feature of Bitcoin makes it ideal for people who have countries that refuse to recognize the dollar.
These “miners” create Bitcoins with the purpose of creating a “block” of transactions processing. Transactions are verified until there are a maximum number of Bitcoins in circulation. Only those Bitcoins that have been verified to become part of the public domain. The supply of these Bitcoins is limited to 21 million.
Unlike conventional monetary system, a person has the choice of whether to get a Bitcoin or conventional currency. The decision to convert Bitcoins to conventional currency is completely free. However, if a person tries to convert Bitcoins to conventional currency that value may become overvalued.
In some cases, the users of Bitcoin prefer to get Bitcoins to use it as virtual currency. They are usually in countries where it is illegal to get and spend money in the traditional money. With the use of a virtual currency, they are still able to buy goods, services and participate in the economy in a safe and anonymous way.
Today, the use of Bitcoin has increased in many countries, and it is starting to spread to the banking system. In many parts of the world, banks and payment service providers are accepting Bitcoins as a form of payment. The use of the virtual currency is slowly changing the way people shop and with this it is expected to impact on the entire financial system. Bitcoin is a way of buying things with convenience and safety.
With this emerging payment system, people are now in control of their own money. The process involved in converting the money into Bitcoin is very simple. The user can directly withdraw their bitcoins from the wallet of their choice. By doing this, they can now access their money without worrying about having to wait for a few days or a few weeks.
Previously, it took days for transactions to be processed, so delays were normal. Now, all transactions are usually processed within a few minutes. The potential gains from this are endless.
Another advantage of Bitcoin’s transactions is that it does not involve any intermediary. There is no need to trust a third party, like a bank, in order to transfer funds. All the transaction is done directly between the sender and the receiver.
This means that the exchange rate between money and Bitcoin is not affected. If you are from Venezuela and you send funds to Ecuador, you can make sure that you will be receiving the correct amount. For countries that do not accept dollar as a form of currency, they can make a transaction to other countries that accept the virtual currency.
With the monetary crises in many countries, countries with central banks that print money can be worried about having inflation. When inflation occurs, the value of money decreases. Bitcoin is being accepted for the first time because of the ease and security of transactions.
There are huge advantages for Bitcoin users. It’s easy, fast and private. For more information, visit our website today.