BITCOIN, CRYPTOCURRENCIES, PUBLIC CHAIN - STEEMIT CRYPTO ACADEMY SEASON 5 - HOMEWORK POST FOR TASK 5 BY @kingkenny042
INTRODUCTION
Happy new year everyone! Well, it feels really good to be here once again to submit my homework post for the task 5. I want to also use this opportunity to thank the whole crypto academy for the opportunity to learn, and to @stream4u thanks for the interesting lecture.
Today, i would be attempting question two (2) for the task 5 on the topic BITCOIN, CRYPTOCURRENCIES AND PUBLIC CHAIN
2.) WHAT IS BITCOIN AND WHAT WAS THE AIM BEHIND BITCOIN INVENTION? IS CRYPTOCURRENCY GOOD FOR A BUSINESS TO ACEEPT AS PAYMENT? WHY?
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"Change is the only constant thing in this world"
Man is constantly looking for a way to make life easier, faster and less stressful. This has lead to constant transformation and evolution in all aspect of life. Bitcoins and cryptocurriencies are just an aspect of this evolution. So what then are Bitcoins?
Bitcoins just like every other cryptocurrency is a form of money that exists virtually online. What this implies is that bitcoins are a form of money or cash that exists digitally on the internet and can only be traded online using computers and mobile phones. Since Bitcoins are a form of cash, they can be used to make payment for goods and services provided that they are accepted as a means of payment by that particular shop or company.
Bitcoins can also be referred to as BTC's. They where first introduced in 2009. And therefore is regarded as the first ever cryptocurrency to be known by mankind. Furthermore Bitcoins are generally regarded as the grand patron of all other cryptocurriencies, as it gave space for the creation of thousands of other digital currencies like Steem, Tron, Ethereum, Solana, FTM etc. Bitcoins is linked to have been started by a mysterious person known as Satoshi Nakamoto in 2007. Satoshi Nakamoto is a Japanese name but Nobody actually knows who he is or whether he is an actual person or whether it a group of people, indeed his existence is really a mystery to everyone.
It is believed that Satoshi Nakamoto created bitcoins, during the time known as the global financial crises with the idea of creating a payment system totally free from manipulation from a central system or the government. This is totally unlike the traditional banking system whereby the central banks controls and manipulates the banking system. The traditional banking system is highly centralised while that of bitcoin is decentralised this allows individuals to have full control of there digital asset. The peer to peer system is used to send bitcoins as well as other cryptocurrency from one individual to another without any intervention from a central system.
Bitcoins are also moulded on the blockhain technology. The blockchain technology increases the level of decentralisation as well as the level of efficiency and transparency of transaction on the bitcoin network since data are shared among thousands of computers making it impossible for a central authority to have control over the server.
Blockchain technology is a secured system that records transaction on cryptocurriencies. the data are stored in blocks and are linked by cryptography. When performing a Transaction on the blockchain the user has to be very careful since an error in transaction can result to a total loss of funds.
The first transaction involving the use of bitcoin was in 2010, when Laszlo Hanyecz bought two boxes of pizza for ₿10,000 from Jeremy Sturdivant. Since then bitcoins has evolved from been just a mere experiment to become one of the most valuable asset in the world. In November 2021, the market capitalization of bitcoin was more than $1Trillion this was bigger than that of some top companies in the world like Facebook and Tesla. Bitcoins are not sold as shares but per one presently the price of one bitcoin is as shown in the screenshot below. As of the time this article was written.
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HOW CAN I BUY BITCOINS?
Now that we've learnt about what bitcoin is, i think that it is also important to understand it's benefit too.
below are just a few benefits of bitcoins
User autonomy: the real owners of a particular unit of bitcoin would not be known since bitcoins make use of secure address system written in codes, therefore the real owners of Btc's are highly protected as no single trace can be linked to them. So the real owners of bitcoins are highly autonomous and unknown. Users information are highly protected.
Easily accessible: users of bitcoins all over the world, can easily assess there funds wherever they are around the globe. All they need to do is to log into the mobile wallet and they can perform transaction just from there mobile phones or with the use of a laptop. So bitcoins creates an easy access for fund withdrawal for users.
Security: unlike physical cash where a person can be robbed, bitcoins are quite secured and well stored in a wallet online. This makes it absolutely impossible for it to be stolen from a person unless if the hacker has access to the owners wallet keys.
Zero bank charges: bitcoin transactions are free from bank charges, what they use is gas fee which is relatelively lower than the conventional bank charges.
No need for a bank account: all you need to own and make use of btc's are just a wallet. There is no need to own a bank account, this makes it easier for owners all over the world to own a pair of btc's
Bitcoins where first invented during the global financial crises for following aims:
Transparency and effenciency : one of the major reasons why bitcoin was invented is to help bring transparency and efficiency to the financial sector. Bitcoin is built on the blockchain technology this makes it highly decentralised and away from the control and manipulation of banks. Unlike the traditional banking sector transaction on the bitcoin network are stored on the blockchain technology which means that the general public can access and see how and when transactions where made thereby leading to a more transparent system of payment.
Reduction in the cost of transaction: The cost of buying, selling and storing bitcoins is relatively cheaper compared to the traditional banking system. So one of the major reasons of the invention of bitcoin is to reduce the cost of transaction which is relatively higher in the traditional banking system where a person has to pay chargers for keeping money in a bank, while leaving your bitcoins in your wallet would require no cost and you can easily send funds to other part of the world at a cheaper rate.
Complete ownership of funds: when you purchase bitcoins into your wallet. You would have complete assess to your invested funds, since you can decide to pull out and withdraw the money anytime you like. But this is not so in the traditional banking system as you might be asked to withdraw only a limited amount of money. You would have complete assess to your bitcoins and you would decide to spend and use it how you deem it fit. So one of the major reasons why bitcoins where created is to help to ensure a system where individuals have complete access to there money.
Reduction of intermediaries in financial transaction: Banks and other financial institution usually acts like a third party during a traditional financial transaction now this implies that traditional banking is usually highly centralised, but this is not so in a bitcoin transaction since a system known as the peer to peer system is used for transaction. So one of the major reasons for the invention of bitcoin is to encourage a system that is highly decentralised.
Irreversible transaction: bitcoin is bulit on the blockchain technology and one of the major features of the blockchain technology is that transaction is irreversible this is done to ensure that buyers and sellers are protected from fraud.
Personally, from my own perspective the answer is yes, cryptocurriencies should be accepted as a good payment option by buiness and here is why;
Low transaction fees: the cost of making transactions in cryptocurriencies is relatively lower compared to the traditional banking system where chargers are deducted for transactions made, now this is good for business as this would guarantee more profit for them. Also the recurrent issue of international payment problems as regarding businesses that have customers in other countries would be solved since payment would be made with cryptocurriencies.
Reduction of fraud: often times we hear about businesses getting scammed by debit and credit card fraud. Now accepting crypto as a means of payment would help reduce this fraudulent activities since bitcoins and other cryptocurriencies are digitalised this would make it impossible for this fraudulent acts.
Removal of Intermediates: crypto are highly decentralised. So accepting crypto as a means of payment would help reduce the stress of going through a central body before transcation is approved. This would help to enhance the speed of doing business.
Irreversible payment : accepting crypto as a means of payment would help solve the problem associated with payment bouncing back, as transactions on crypto are usually irreversible and payment is payment so business would know exactly when there money is coming in.
At the initial stage when bitcoins started, most people didn't believe in it. But today cryptocurriencies and bitcoins are seen as money of the future as more and more people are beginning to get on board and even some countries of the world are beginning to accept them as a means of payment. This are interesting times and indeed the future of cryptocurriencies is looking bright.
Thanks for reading!