Bitcoins are world’s first decentralised
cryptocurrency. They have evidently become the buzzword of 2017 with its values
going stratospheric. However, no one knows who created them initially but they
first appeared in the year 2009 with the developer allegedly named Satoshi
Nakamoto . Bitcoins are virtual coins which can be transferred through internet
from one person to another which is more like peer-to-peer communication . They
are encrypted in order to prevent duplication. Top companies like Microsoft,
Wikipedia, Tesla are encouraging and accepting payments in bitcoins. There are
also similar cryptocurrencies like bitcoins which are Ethereum (ETH), Litecoin (LTC), Zcash, Dash and
In 2008, a domain named bitcoin.org was
registered anonymously. Satoshi Nakamoto was the first person to mine a block in
the year 2009 and to earn 50 bitcoins which is called the genesis – the first
mined block. World’s first bitcoin transaction happened between Satoshi and
programmer, contributor and adopter of bitcoins – Hal Finney who had downloaded
the bitcoin software and earned 10 coins.
does it work?
Bitcoins can be generated
by anybody from anywhere in the world with internet Total number of bitcoins
are predictable and limitedBitcoins are stored in
digital wallet which is supported with high private and security keysWhen bitcoins are
transferred, an e-signature is added which is verified by the miner and
permanently stored in the network Storage of bitcoins can
also be offline which prevents it from being stolen which can be stored in
hard-drives or mobile phonesIt is an open- source and
free software where anyone can renew the codeMain motive of bitcoins
is to support complete anonymity where the digital address of each wallet can
be recorded whereas names of individuals who own them cannot be.
They can be accepted
through payments for goods or services provided Exchanging them for
Mining is more like solving a puzzle. But,
as more people join the race, it becomes more cumbersome to acquire one. More
it is mined, the less they are to be found. As miners do it prominently, the
problems or puzzles might become more easier to solve in order to show that the
flow is steady, value is boosted and to remain inflation proof. Every bitcoin transaction is recorded
using a block chain which acts like a ledger and prevents people from spending
it more than once.
Bitcoins are highly used
to buy video games , gifts, books etc.,They can be traded to
dollars, Euros and moreGreat way for small
businesses and freelancers to get noticed Companies are making use of Third-party services like Bitpay &
Cryptopay to have direct access to the Bitcoin Markets, allowing Merchants a
solution to avoid speculating Bitcoin as an investment but instead use it
rather as form of payment method.NGO’s are encouraging
donations through bitcoins and are supporting digital currency.
and how does it grow?
The value of bitcoins are growing day by
day and are skyrocketing. This is because bitcoins are the most convenient way
of transaction which totally surpasses the banks. There is no central
administrator to regulate them. No additional banking charges and less
procedures to follow are making it more opportune for black marketing . From 2011
– 2013 criminal traders invested millions of dollars to buy bitcoins to safely
move money from the eyes of law. This made the worth of bitcoins to go sky high
within a short period of time.
Currently, about 21 million bitcoins exist
. Out of which, about 16 million have been mined and are in rotation in the market. 4 million will be mined in
another 10 years and the last one million will take at least a 100 years to
mine where all of them are to be mined by the year 2140 !
Even though bitcoins entered the market in
2009, its price significantly began to grow up only in 2013 April where 1
bitcoin was between $500 to 1000. In 2017, the price rose above $1000 for the
first time and by November 2017 it crossed a whopping $11000 in less than a
decade since it was introduced.
Currently ,one bitcoin is an equivalent of
13193.27 USD or 842755.74 Indian Rupee.
In a recent study out of 4000 respondents,
about 55% are millennials who are bitcoin users and about 90% of them are male.
the bubble burst?
As everything has its own pros and cons ,
even bitcoins do have their own. Since, they promote anonymity, there are
increasingly used for tax invasion, black marketing and fraud and the
government is under extreme pressure to end that. The value of bitcoins
fluctuate wildly. Even if they are backed up with high security keys they are
also more prone to hackers and it is difficult to track their identity.
Cryptocurrency is always inclined to high risks and the rise or fall in market
is always unpredictable.
Eventually, bitcoins are highly
provocative because they take the power of making money away from central
federal banks, and give it to the general public. They can ultimately change
the way we spend and save.