In the previous article I talked about:
- why bitcoin?
- beginning of bitcoin
- Bitcoin Stages
Now I'll continue to explain some points like:
- Where does Bitcoin come from?
- How does Bitcoin work?
- Bitcoin Transactional properties.
- What are the advantages ,disadvantages of Bitcoin?
I will briefly explain all these points and questions
Where does Bitcoin come from?
bitcoin come by mining ..this mining operation is similar to the extraction of gold by drilling in mines, either individually or as a group, but in the process of mining bitcoin, replacing the tools drilling computers and the more the device is capable of processing, its ability to extract currencies more quickly and replace the gold mine With a program to solve complex equations that carry currency codes, and who finds currency code this coin becomes his property, and there is a lot about the world who became obsessed with this coin and booked full-time servers working around the day to solve equations and extract coins.
How does Bitcoin work?
Bitcoin works on a vast public ledger, also called a blockchain, where all confirmed transactions are included as so-called ‘blocks.’ As each block enters the system, it is broadcast to the peer-to-peer computer network of users for validation. In this way, all users are aware of each transaction, which prevents stealing and double-spending, where someone spends the same currency twice. The process also helps blockchain users trust the system.
Bitcoin Transactional properties.
There are some things you should know very well before you start dealing with bitcoin like:
- Money sent cannot be retrieved
When you make a purchase or send bitcoin to someone, remember that no one in the world can retrieve your money again. So you should be very careful before you start sending your own bitcoin
All transactions in bitcoin are done in strict secrecy you will not be able to identify the persons you are dealing with since the transaction is based on a 30 digit and letter address. Just no names, no IDs.
Transaction is propagated nearly instantly in the network and are confirmed in a couple of minutes. Since they happen in a global network of computers they are completely indifferent of your physical location. It doesn‘t matter if I send Bitcoin to my neighbour or to someone on the other side of the world.
What are the advantages ,disadvantages of Bitcoin?
Like everything there are advantages ,disadvantages bitcoin also has some advantages and some disadvantages I'll briefly mention in these points:
Bitcoin transactions are completely anonymous and private. Unlike in payments through bank, where the transactions can be tracked and identified, bitcoin transactions cannot be identified. A person can only know the addresses of the bitcoin wallet on which the payment has been sent and received. But to whom these addresses belong to, cannot be identified
- More secured
Another advantage of bitcoin technology is that It’s almost impossible to hack your account under bitcoin. Bitcoin funds are securely locked under cryptography system. If you’re the owner of a private key, only you can send crypto-currency i.e. bitcoins. Since it is made by using solid cryptography and huge numbers, it’s impossible to hack the address.
- Payment Freedom
Paying through bitcoins provide the utmost freedom. Bitcoin can be transferred to any person in any part of the world. No intermediaries in between. No bank holidays/strikes. No boundaries or borders. No payment limit.
- Low/Minimal Fees
Paying through Bitcoin has very low and sometimes no transaction fees at all. It all depends on the priority of the person. If a person wishes that his/her transaction get’s processed fast, he has to pay a transaction fees which is still very low as compared to any financial intermediary or digital wallets.
- Swift and global
Once the transaction is initiated, it is propagated instantly to the global network; and the transaction would be confirmed within couple of minutes. And since it is done with a wide global network, physical location of the owner doesn’t count.
now disadvantages of Bitcoins:
- Degree of acceptance
Many people are still unaware of Bitcoin. Every day, more business organizations are accepting bitcoins but the list remains small and still needs to grow in order to benefit from network effects.
Bitcoin prices are very volatile and increases/decreases at a very high pace. Speculators wish to take advantage of it but genuine investors thinks of it as too risky and therefore all the investors does not invest in Bitcoins.
- Possible Government Interference
Well the government may not take your Bitcoins away but can ban it in the country, which forces bitcoin wallets and companies to shut down. The bitcoins in these wallets are freezed and access to them becomes difficult.
- Can lose your wallet
There is a possibility of losing your wallet. If you have stored the money in the form of digital currency on your phone or computer, you better remember your password and not lose those devices. Losing your coins means you won’t be able to retrieve it, even with the help of legal assistance so that is just one of Bitcoins flaws.
- No way to reverse the payment
if you mistakenly pay someone by using cryptocurrency, then there is no way to get a refund of the amount paid. All you can do is to ask the person for a refund and if your request is turned down, then just forget about the money.
- Money Laundering/Black Market
Initially bitcoins were used for money laundering and people operating in black markets, which did not wanted to reveal their personal information and get payment secured. In money laundering middleman/intermediaries would collect money from one source and transfer it to another source through Bitcoins.
Now I'm done explaining some things about bitcoin. I hope you find the benefit of what I tried to offer you.
Very important... In the next article, I'll tell you some ways in which you can get some of the bitcoin.
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