What who chooses to participate in the
What is bitcoin and how does it work?Bitcoin has been called the money of the internet however it is more like the internet than actual money.
It is not a company, It’s not a product. It can never be owned by anyone. It is a standard or a protocol just like the internet. Bitcoin operates by simple mathematical rules that everyone who chooses to participate in the network agrees on. Through this invention, Bitcoin is able to allow a completely decentralised network of computers to agree on what transactions have occurred on that network, essentially agreeing on who has the money. Transactions are made without the use of middle men – meaning, a bank does not have to be utilised.
More merchants are beginning to accept them. In addition, international payments are easy and cheap because bitcoins are not tied to any country or subject to regulation. A transaction is a transfer of value between two Bitcoin wallets that gets recorded onto the blockchain. Bitcoin wallets keep a secret piece of data or encryption called a private key which is used to sign transactions, providing a mathematical proof that they have come from the owner of the wallet.Where did Bitcoin come from and how has it become so popular.It is unknown who designed Bitcoin or who created its original reference implementation. It is claimed that the creation of bitcoin has been accredited to Satoshi Nakamoto a japanese programmer or this is the alias used by the unknown person or people.
In august 2008 the domain name bitcoin.org was registered. Later that year a paper supposedly authored by someone with the alias Satoshi Nakamoto was posted to a mailing list. this paper specified and documented methods of utilising a peer-to-peer network to generate what was described as “a system for electronic transactions without relying on trust. Fast-forward to january 2009 and the bitcoin network comes into existence with the release of the first open source bitcoin client and issue of the first bitcoins. The value of the first bitcoin transactions were negotiated by individuals on the bitcoin forum with one notable transaction of 10,000 BTC used to indirectly purchase two pizzas.
The only time in the history of bitcoin where the vulnerability was exploited occurred in August 2010, where transactions were not being properly verified before they were included in the transaction log, which then allowed users to bypass bitcoin’s economic restrictions and create an indefinite number of bitcoins. Over 150 billion bitcoins were created in a a single transaction, and sent to two different addresses on the network. Within the space of a few hours, the transaction was located and erased from the transaction log after the bug was fixed and the network forked to an updated version of the bitcoin protocol.The popularity of bitcoin soared in 2017 gaining its highest price to date. Starting the year off at around $1300 per coin in january and peaking at $26800 Mid december. Some reasons for this rapid growth in popularity can be attributed to the media hype of get rich quick schemes and strategies or the actual technology behind it and what it allows an individual to do.
A recent report from goldman sachs discovered that 33% of millennials believe they will not need a bank account in 5 years citing that we are quickly moving past the days of carrying cash or utilising a credit card. The convenience of Bitcoin goes several steps further than the use of credit cards by offering significantly lower transaction fees and virtually immediate transaction time and is also accessible through the many bitcoin wallets available. On top of convenience it offers credit card users freedom and security from identity theft, high interest rates and fraud.
How and where can you buy Bitcoin?In order to purchase bitcoin one must first create a wallet in which to store coins. There are many wallets available such as a hardware device or paper wallet, an online wallet utilising an exchange platform or via an independent provider. The choice is up to the individual and how secure they want to keep their coins. To purchase bitcoin one must sign up and open an account on an exchange of which the are hundreds currently operating with differing rates and fees.
Most exchanges accept payment via bank transfer or credit card and once your payment has been cleared you are free to purchase bitcoin at current price or set buy orders for predicted price drops. Some australian exchanges currently selling bitcoin are BTC markets, Coinbase and independent reserve.The future of Bitcoin.There are mixed feeling towards the future of bitcoin with some experts claiming it will soar to 10 times the current price while others believe it is in a bubble and advise against investing in it.
It has been said that Bitcoin maybe overtaken by another cryptocurrency with better security and even faster transactions citing that the bitcoin technology is the key not the actual coin itself.