The Bitcoin is the first decentralized digital currency used
all around the world. It was created in 2009 by an unknown source using the alias Satoshi Nakamoto. Bitcoins
are digital currency created and contained electronically. When you buy stuff
electronically it is like digital trading. Bitcoins are not physically printed,
but instead created within a small network of computers.
Bitcoins are transferred from one person to another through the Internet
just like a text or e-mail. Bitcoins work in all countries as the same unit
rather than having to convert US dollars to the currency of the region. Bitcoin
owners can use several currencies to buy and sell Bitcoins for dollars, euros,
and other currencies. Bitcoins are said to be kept safe and secure in your
computer’s digital wallet. Bitcoin miners secure and protect Bitcoins while
also creating more Bitcoins to use. When a miner verifies a transaction they
are rewarded with more Bitcoins. Bitcoin promoters say that using Bitcoins can
sometimes lower company transaction fees as well.
The Bitcoin currency is based on gold and silver, supposedly, and
currently worth $354.98 per unit on November 21, 2014. In 2013, Cameron and
Tyler Winklevoss, the athletic twins who helped dream up Facebook, purchased 1
percent of all Bitcoins in circulation at the time and were the keynote
speakers at the Bitcoin 2013 convention.
Realistically Bitcoins are hard to use because so few merchants allow payment
of goods to be paid with Bitcoins as currency. Several people have tried to
live solely on Bitcoins for short periods of time. In my opinion, they failed
since the Bitcoin users had to trade Bitcoins for real currency to buy the
things they really needed or spend more time looking for a merchant that
actually would allow Bitcoins as payment.
Living on Bitcoins would only be a successful option for mainstream
customers if you lived in Berlin, Germany, as it has more merchants currently
accepting Bitcoins. I would not say these experiments were successful, but they
did prove you could technically live on Bitcoins if you were willing to live in
a barter and trade economy.
Many advocates say a favorable trait of Bitcoins is how easy they are to
set up and remain anonymous, but that implies setting up a traditional bank
account is difficult. And even though promoters claim Bitcoins are a completely
transparent system, users are supposed to feel confident that miners are busy
creating new Bitcoins and watching the system to keep it error free. Bitcoins are
also not printed, instead they are produced by lots of people running computers
around the world with special software that solves mathematical problems.
While Bitcoins may work for
some people, I believe that the prices are not consistent and there is no way
to create a budget with fluctuating prices. As an example if one-day milk was 5
Bitcoins and another day it was 25 Bitcoins you would never know how much it
would cost. Therefore, it doesn’t sound like a very consistent or stable use of
money.
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