BITCOIN, CRYPTOCURRENCIES, PUBLIC CHAINS - Steemit Crypto Academy Season 4 - Homework Post for Task 5.
Homework Task 5
- Question
What Is Bitcoin and what was the Aim Behind Bitcoin Invention? Is Cryptocurrency Good For A Business To accept As Payment? Why?
Prior to explain Bitcoin, I will briefly explain what cryptocurrency and Blockchain is, because Bitcoin is the 1st cryptocurrency to run on Blockchain.
Cryptocurrency
Cryptocurrency is a kind of digital or virtual money which we cannot see physically to our naked eyes. In some countries, Cryptocurrency can be used as a payment method for the goods and services in our day to day life.
Cryptocurrency is using a methodology called cryptography; an algorithm, a decentralized data base, which allows encryption and decryption of data.
As you can see in the below screenshot, it shows you some of Cryptocurrencies and their respective data like price, market cap, market supply volume etc.
Blockchain
The data base which has the fullest record of the Cryptocurrency transactions is called as a Blockchain.It is a public ledger which can store immutable data of transactions of cryptocurrency.
Using of Blockchain is more secure because, here in blockchain, it consists of many blocks which records all the Crypto transactions. So, no one can change a block without changing all the other blocks because of the decentralization feature.
Bitcoin is crowned as the first decentralized digital currency which was developed in 2008 and released in 2009. At the initial stages of this new invention, people could not understand the concept behind this, but when the time passed by now it has become the world’s most popular Cryptocurrency. Sathoshi Nakamoto, a mystery person or a group was found to be behind the invention of this digital currency.
Initially, Sathoshi Nakamoto wanted to find an alternative method for the conventional payments and transactions. So, Sathoshi Nakamoto came up with an idea of a decentralized digital payment method. As we are experiencing now, Bitcoin is a digital currency payment method without an interference of a third party. Not only that nowadays some countries accept Bitcoin as a payment method for goods and services. For am example, In recent past world many people funded one Bitcoin for the Covid 19 affected people in South Asia.
At the moment, right from the beginning of the innovation of Bitcoin, it has crowned as the no 1 ranking in the Cryptocurrency list and at the moment it has a price of $61,064.51, market supply of 18,852,175 BTC, market cap of$1,149,657,225,281.
As we all know, cryptocurrency is high volatile. So this Bitcoin is also same as that and can experience price fluctuations at any time.
Decentralization, Faster and transparency of transaction are some of the special features in Bitcoin and people can earn or acquire Bitcoin by joining with Bitcoin mining process or buying with transferring fiat money and buy BTC.
Aim Behind Bitcoin Invention
Before the invention of Cryptocurrency, conventional fiat currency system has been used in the world. But Sathoshi Nakamoto wanted to take out the regime of that normal conventional bank system, which had a central authority. Then he came up with a new idea of decentralization which use cryptography algorithm and runs on blockchain.
When considering conventional money transferring method from one country to another, it has to undergo a big process but, using decentralization exchanges one can transfer assets in any part of the world with faster and easier.
Another aim is to get rid of the high bank fees that are being charged in the conventional bank system.
Reducing the gap between the sender (who is having the full power of the assets), and receiver is another aim and by that transaction transparency will be implement in a secure platform.
Creating jobs and reducing poverty is another big aim and at the moment also we are experience in such that because we have seen many users who are now crowned as millioners.
Is Cryptocurrency Good For A Business To accept As Payment? Why?
According to my knowledge, I would say it would be great if Cryptocurrency is being accepted as a payment method for businesses. To get into that position, the following reasons help me a lot.
Quick transaction
As I mentioned earlier, when considering traditional method, it may take more than a day to transfer money from one country to another. Not only that, sender and receiver have to fill so many papers as well. But in cryptocurrency, within minutes the transfer can be completed anywhere any time without an interference of a 3rd party. Just get a good connection of internet, use your mobile or laptop and do the transfer. In nutshell not only this transfer is faster but also it is very user-friendly too.
High security
As stated earlier, it is a really impossible thing to hack the Blockchain algorithm and decrypt the data in it. If someone wants to do so, then he/she must be change the data in all the connected computers. Another thing is that in decentralized wallets or exchanges they do not need your personal data while the registration. So because of this accept cryptocurrency payment as a payment method will give you a high security than the normal fiat currency does.
Low Transaction fees
When performing fiat currency transactions, your bank may charge a high transaction fee. Especially when you are transferring fiat currency to abroad you can experience this. But with crypto transactions for a low transaction fee, you can transfer crypto currency anywhere in the world.
High profits and passive incomes.
As we all know volatility of Cryptocurrency is very high. The person who is smart in analyzing and trading and hold assets can get a good profit when the market price goes up. Also the options like staking will give you a compensation fee and with that you can earn a very good passive income as well.
Thank you @stream4u for organizing such valuable lessons for all of us and I learned a lot through this.