The Bitcoin Era

Lately, Bitcoin has become a rather popular term. But you’d be forgiven for not knowing what a Bitcoin really is — it’s still got large markets to tap.

There are plenty of cryptocurrencies around the world (over 1000 of them at last count!), and Bitcoin is the most famous of them all. In fact, it’s what started it all. A cryptocurrency is designed to work as a medium of monetary exchange, which uses the concept of cryptography to ensure safety, security and weed out the problems with digital currencies (such as double spending).

It was in 2008 when a man named Satoshi Nakamoto posted a research paper on an obscure cryptography listserv (an emailing list), describing his research on a digital currency. Initially, it wasn’t seen as groundbreaking research and did not catch the world by storm. The idea of decentralized money was definitely promising, but at that time, the masses did not have faith in it. Today, price of 1 Bitcoin is over $4500!

On its journey from the price of a few cents to over $4500, Bitcoin has impacted the world in irreversible ways, and made millionaires out of thousands of people! Let’s dive into some of the biggest ones.

How does Bitcoin work?

Bitcoin is a decentralised currency — it is not tied to any organisation, unlike the currencies we use. The question is — who manages and controls this currency? It is the users themselves.

All people who use Bitcoins are the ones responsible for running its blockchain network by providing their computing power. There exists a public ledger which is operated on this blockchain technology. The ledger contains a list of every Bitcoin transaction that has ever occurred, and this list is visible to anyone who wants to see it. This also prevents fraud as transactions cannot be modified or overwritten since everyone on the network has access to them!

The Bitcoin Impact

Ever since the evolution of Bitcoins, many computer experts started using their skills to make the network more advanced and better. These people came to be known as “miners.” These miners use special mathematics software, with the help of which they get new Bitcoins and support the block-chain network. With the advancement of Bitcoins, the role of these miners have increased manifold (even though mining itself isn’t nearly as profitable now, but more on that later). In other words, Bitcoins along with being a smart currency have created work incentives for numerous people.

Bitcoins have brought about an irreversible change in the lives of all the people using it. What is so special about this currency?

With Bitcoins, it is now possible to send money in any part of the world at any time and with no limitations at all.

Bitcoin transactions protect your privacy. We have heard about how all your financial data gets repeatedly leaked on the internet due to hacks of credit card data. This is not possible with bitcoins.

Transaction costs are minimal. The fees compared to credit cards and online banking are negligible.

The bitcoin network is extremely secure — it is very difficult to seize or steal coins unless you’re following bad security practices. It is also impossible to manipulate the system, again — because of the public blockchain. Anyone at anytime can verify transactions in the block-chain.

Because of the non-reversal property of the bitcoins, merchants remain protected from losses that might occur from fraud.

The World Is Joining The Bitcoin Bandwagon

All of us know that in the past few years, internet users have increased exponentially, which has obviously changed the path of the industrial world and has shifted everything online. Since people have started spending money online, Bitcoins turn out to be an innovative discovery.

Large firms such as Microsoft, Expedia, Dell, etc have joined the bitcoins network and have started accepting payments in Bitcoins — giving the currency even more credibility.

In many developed countries, small vendors have started shifting towards bitcoins instead of other kinds of online payments because it’s so much safer!

The number of bitcoins users continues to rise — having reached approximately 16 million, in less than a decade.

From July 2015 to August 2017, number of Bitcoins ATM’s increased from 415 to 1402.

Venture capital investment in Bitcoin shot up significantly, from $98 million in 2013 to $1 billion in 2015.

With Japan legalizing Bitcoins, it has become the largest bitcoin market in the world. Bitcoins saw a 8% hike in price after Japan passed laws legalizing it.

Future Potential

Bitcoin remains unique because of its features of privacy and its decentralized model. It has helped in economic growth too, which makes it a really powerful platform. Since the total production of bitcoins is to be limited to 21 million, the demand is only set to increase.

Like Japan, expect many countries all across the globe to legalise the currency — which will bring with itself larger hikes in price!

Bitcoins may not be a household name right now, with the common man in developing countries still struggling to make online payments. But the one-directional growth in this industry is a clear indicator of that fact this is on its way to being the world’s most accepted cryptocurrency. If you haven’t joined the bitcoin train yet, it’s not too late.

Disclaimer: Bitcoins and cryptocurrencies face several legal and technical risks. Please be cautious before you invest in them.