Cryptocurrencies are considered a digital subset of currencies and, as such, have no physical representation. There are thousands of cryptocurrencies worldwide and among them, bitcoin is the most famous name. Bitcoin was created during the financial crisis and its purpose was to address economic problems related to centralized currency. Bitcoin can be bought and sold online and can be used to buy products and services, and those who do this are guaranteed privacy and anonymity. When discussing the bitcoin concept, it is important to understand its purpose, how it works, and that even though it is a new technology, it can be the currency of the future.
Bitcoin was created during the financial crisis of 2009. It was founded and developed by an unknown person using the alias Satoshi Nakamoto. He founded this new currency because he saw a need for a new kind of electronic payment system. His idea was to produce a global currency independent from any central authority, transferable electronically, and with very low transaction fees, different from our standard currencies such as the dollar and the euro that are controlled by governments and banks. As an example of how bitcoin works, if someone in Japan buys something from an American seller and pays with bitcoin, there is no conversion rate, no bank delay, and no bank fee. That said, many people believe that bitcoin can be the currency of the future.
But why can bitcoin be considered the currency of the future? as our society evolves, new technologies are needed to improve and facilitate people’s lives, as the paper bill was created to facilitate payments bitcoin was also created with the same purpose but with further vision. A long time ago people used goods, gold, and silver as a method of trade and currency. Many years later the government saw a need for a new kind of currency exchange and created metal coins and paper bills. But actually, a piece of paper and a round piece of metal is not really worth anything; however, people value it the same way cryptocurrencies are being valued by people. In addition, bitcoin is easy to buy, sell, and use online. People can buy, sell, or use it to buy things by using “digital wallets,” which exist either in the cloud or on a user’s computer. As an example of bitcoin use, people can buy games, apps, food, jewelry, etc. Moreover, the names of buyers and sellers are never revealed – only their wallet IDs. Due to this fact, bitcoin is also protected against identity theft. Further, the value of bitcoin is growing every day and even banks and celebrities are investing in it. As outlined previously, bitcoin has many advantages compared to our standard currencies.
So, cryptocurrency and bitcoin included will be the currencies of the future because they are the only currencies that are following technology and facilitating people’s lives at the same time without a need for banks and government to control it. However, bitcoin is considered a new technology, so it is important to understand that new technologies can take months, years, or even decades to reach critical mass. Bitcoin was created to make digital payments easier. Also, since bitcoins are an international currency, people can use them in any country without converting between currencies. And much like the internet, no one wants to miss out on this new kind of currency, so for now bitcoin is considered the biggest thing yet.
Source
https://en.wikipedia.org/wiki/Bitcoin#Blockchain
http://money.cnn.com/infographic/technology/what-is-bitcoin/
https://www.coindesk.com/information/what-can-you-buy-with-bitcoins/
Written by Ana Da Silva
