How was Bitcoin born?
In 2008 the global financial crisis occurred due to the US real estate bubble. This was followed by Lehman Brothers - the fourth largest US investment bank declared bankruptcy with a debt of 4 billion USD.
The US economy and the world wobble. A series of corollary such as unemployment, business losses, ...
Doubts about the traditional banking system arose from it. At this time, the domain name bitcoin.org was registered on August 18, 08.
On October 31, 10, the Bitcoin whitepaper was released by Satoshi Nakamoto.
January 3, 1 Genesis Block - the first block in Bitcoin's Blockchain was born. For the first time money is not under the control of a government or central bank.
How does Bitcoin work?
Bitcoin works based on Blockchain Technology. This technology helps you trade without going through a third party.
Blockchain provides a ledger. It contains all network transactions.
When you make a transaction, it is first verified by the Miner (miner). The miner here is actually a computer.
This machine performs authentication for transactions. In return they often get BTC.
Then, if there is no fraud, your transaction will be added to this ledger. This means that your money transfer is successful.
Blogtienao.com Please give an example to better understand:
Example:
You have relatives in England. If they want to send you money, they need to go to the bank or transfer to your VISA card or some online payment gateway.
Generally, all parties must go to an arbitrator and pay a fee. It may take a few hours or even days for the funds to be transferred to you.
Once the money has passed, you need to go to the bank and wait for the withdrawal procedures or withdraw the ATM. This process takes time, effort and money.
Moreover, you and your relatives choose a form of bank trust.
What happens if the bank is attacked by hackers? Or did an individual at the bank redeem your transaction?
But if your loved one uses Bitcoin, it is different. You can still send money without having to go through an intermediary.
All you need is an internet connection, it only takes 5-10 minutes. They can send you BTC from anywhere in the world.
And of course in Vietnam you will also receive Bitcoin. The transfer fee is almost = 0 Selling it is as easy as gold or dollars at current exchange rates on exchanges.
Why do we trust Bitcoin?
We can trust Bitcoin because we do not have to trust anything. Sounds awkward doesn't it? But the truth is it is.
With virtual virtual currency you can transfer it from one person to another without going through a third party like a bank to build trust.
In addition, Bitcoin is open source and fully decentralized. If you are a programmer you can check how it works.
All transactions on the Bitcoin network are public and can be reviewed by anyone. When you make a transaction, no one can edit or reverse it.
Because it is not under the control of anyone even the creator of BTC.
Bitcoin unit
The virtual currency bitcoin also has a unit called "Satoshi", named after its creator "Satoshi Nakamoto". Satoshi is the smallest unit of this currency.
We can convert 1 BTC = 100,000,000 Satoshi. That is a satoshi = 0.00000001 BTC. Compared to vnd, a satoshi costs more than 1 VND at the time of writing.
Advantages of BTC cryptocurrencies
As leading experts have pointed out, the birth of bitcoin marked a historic turning point in electronic payments. Bitcoin with tremendous advantages and superior to other currencies:
Convenient to transactions
Bitcoin cannot be fake
High security and safe
High security and safe
Extremely low transaction costs
Potential for e-commerce development
Convenient to transactions
For banks or online payment services (transaction intermediaries), there is usually a limit on the transfer and receipt of money on the day and time.
But in bitcoin there is absolutely no. You can send unlimited amount of money, anywhere in the world at any time to relatives and friends without anyone managing the amount you send.
Bitcoin cannot be fake
An additional advantage of bitcoin is that it cannot be counterfeit, as bitcoin does not exist in physical form like other currencies.
Moreover, verifying bitcoins is costly while gold is very high.
High security and safe
All bitcoin transaction information is displayed on the internet but the identity of the trader does not appear, so the information security is high.
As of now, the bitcoin protocol still has no security holes to lose users' bitcoins.
Extremely low transaction costs
Since there are no intermediaries managing bitcoin transactions, the cost = 0. you only charge the processing fee to the systems but very low.
The transfer of 49552 BTC (~ 480 million USD) moved only about 0.18 USD. A transaction of hundreds of millions of dollars with less than 5,000 VND fees.
Can you imagine how low it is?
Environmental protection
Bitcoin coins do not have to use printing or mining chemicals to create them, so they are environmentally safe.
The computer system that processes Bitcoin transactions consumes more power than the current financial system.
Potential for e-commerce development
Currently, there are many businesses, companies, stores, that allow the use of bitcoin to pay fees.
All bitcoin transactions cannot be reversed or reversed, so any fraud is useless.
Cons of Bitcoin Cryptocurrencies
Although BTC has many advantages, nothing is perfect. The disadvantages of this radical proposal are as follows:
The number of users is small
Bitcoin is not easy to use
Bitcoin prices fluctuate frequently
Hackers, criminal launching money
The number of users is small
Bitcoin is mainly used in developed countries like the US, China, ... and in non-developed countries like Vietnam, the use of paper and gold currency is familiar.
And most people are not aware of cryptocurrencies. Some groups of people do not have enough knowledge What is bitcoin then said that Virtual the BTC is unreliable. So they are still scared and afraid to use bitcoin currency.
Not easy to use
Without knowledge of technology and a real understanding of bitcoin, it is difficult to use and trade it. As mentioned above to use this money you need to create 1 bitcoin wallet, and exchange it for cash.
Therefore, for those who do not know anything about information technology, they need experienced people who can guide them to perform these jobs.
Prices fluctuate frequently
Like the dollar, euro, gold or stock market, bitcoin also changes in real time.
With a sharp rise, sometimes a sharp decline, most of the changes in the world affecting cryptocurrency could make the price of bitcoin.
For example, when the first bitcoin was released, the price was said to be only a few dollars, but currently the price of 1 bitcoin reaches more than $ 1000.
Hackers, criminal launching money
Due to the uncontrollable form of bitcoin trading, many criminal groups use this money as a means of transaction.
Hackers can also find and attack many bitcoin exchanges and steal. Besides money laundering can also take place at any time.
Why is Bitcoin worth it?
Bitcoin is important because it contains features such as currency, silver and gold:
Efficiency
Mobility
Exchange features
Scarcity
Can be divided
Identifiable
It all depends on the technology, not on the trust of the central bank like fiat money. There is also no need to rely on physical properties such as gold, silver.
But all of the above factors do not determine the value of Bitcoin. The key to the value of Bitcoin is its acceptance and trust.
Today many businesses accept Bitcoin as a form of payment. This proves that bitcoin is important, not important
