If somebody mentioned Bitcoin sometimes back, nobody would have bothered to know what it is. However, Bitcoin is now a popular virtual currency that everybody wants to learn about and, perhaps, own. You can also read about Bitcoin on the internet as many websites and blogs have information about this virtual currency.
The recent increase in Bitcoin price is, perhaps, the primary reason for the heightened popularity and interest in this digital currency. Today, a high number of people are trading this virtual currency on crypto exchanges. Platforms like Brexit Millionaire are having more new users signing up for accounts every day. Such platforms allow individuals to purchase this virtual currency, sell it, or trade it for profits.
All these activities hint at the increasing popularity of this digital currency. But why should you care about Bitcoin anyway?
Understanding Bitcoin Better
Bitcoin is a blockchain-based platform that is entirely decentralized. Using this system, people can transfer and receive value without involving any monetary authority like a central bank or government. A peer-to-peer community comprising a computers network maintains this system. These computers are called nodes, and their distribution forms a public ledger in the blockchain. People use these computers to generate new tokens by validating transactions. The people validating Bitcoin transactions are known as miners because the process is called mining. And the new Bitcoins are their rewards. While Bitcoin transactions are fundamentally anonymous, the blockchain ledger recording the information is public and global. Thus, people can trace every transaction via cryptography.
Why is Bitcoin Important?
While the world has many digital currencies today, Bitcoin was the first one. Satoshi Nakamoto, who is an individual or a group, created it back in 2008. This virtual currency's value has increased exponentially to a ridiculous level. But, its price has been fluctuating since its introduction. However, this doesn't mean Bitcoin investors have lost all their money. If somebody invested $100 in Bitcoin in 2010, they would have sold it for more than $100 million in 2018.
Additionally, more internet sellers and local retailers now accept Bitcoin payments. And this indicates that this virtual currency is slowly becoming a mainstream payment method. This virtual currency is also essential because institutional investors are also spending on it. Some companies are converting their fiat money holdings into Bitcoin.
Unlike fiat currency that central banks and governments can control or mint more, the amount of Bitcoin in circulation depends on what miners generate. What's more, Bitcoin's supply can't exceed 21 million tokens. After miners have generated this amount, the world won't have additional Bitcoins.
That means Bitcoin can suffer the consequences of government acts like minting more money leading to inflation. For this reason, some people compare Bitcoin to gold. Others invest in it as a hedge against government-instituted inflation.
Why Should You Care?
Bitcoin is a successful digital currency. And there's no secret that the current world is digital. That means Bitcoin could be the currency that the world needs right now. Some banks spend money by collaborating with crypto clients.
Countries like El Salvador are in the process of making legislation that will make Bitcoin a legal tender. There is also an increasing number of businesses accepting Bitcoin globally. Additionally, Bitcoin's value increases as miners near the limit of the tokens that will ever exist in the world. What's more, the world is embracing blockchain, the technology behind Bitcoin.
All these are indicators that Bitcoin is on the right path. Eventually, Bitcoin could be the world's digital currency. When this happens, people will be using Bitcoin as a financial system facilitating real-time transactions regardless of the sender and recipient locations. Now is the right time to learn about Bitcoin and perhaps, invest some of your money in it.