Bitcoin: A peer-to-peer electronic cash system

Cryptocurrencies or digital currencies have been able to capture the interest of investors around the whole world. The rise of attention towards cryptocurrencies mainly started in 2017.

Bitcoin is a type of cryptocurrency, or you can say electronic money. Satoshi Nakamoto is considered to be the inventor of bitcoins. Though for unknown reasons, the idea of Satoshi remains unknown the public.

Bitcoin was created to provide a new global form of global currencies that can be used instead of other forms of traditional currencies- U.S. dollars, euros, etc.  Nakamoto describes this form of crypto currency as “peer-to-peer electronic cash system.” No third party mediator (bank or any other financial intermediaries) is involved in this kind of system.

The main intention behind finding Bitcoin is to resolve the problem regarding electronic cash payment. Nakamoto identified lack of trust between counterparties making and receiving payments due to the underlying risk of fraud. The current electronic cash payment system depends on third parties. They verify and keep a record of monetary transactions and protect users from fraud. Nakamoto mentioned that we need to pay for this through the loss of privacy and transaction fees.

But, Bitcoin can solve this problem. Here’s how:

Bitcoin was designed to be decentralized, that means no central government, no company, or no interference of any other third party to determine its value. Also, the system comes up with a predetermined eventual fixed supply of 21 million units of Bitcoin. So, there is a very little risk of the devaluation of currency because of the rise in the money supply.

Not only has this, Bitcoin solved the issue of trust and its associated costs that you have to incur in the current electronic payment system. Bitcoin provides us with a feature of distributed ledger, called a “blockchain.”

A distributed ledger is a public and complete record of all payment transactions that can provide us with the proof of ownership of every Bitcoin in circulation. It’s like an open book, anybody can see it.’ A network of several computers, referred as “nodes” maintains the copies of the distributed ledger. This dismisses the want for the interference of any third party to maintain a ledger.

Individuals or companies do the job of maintaining the ledger of verifying accounts and are called “miners”. Miners receive Bitcoin as a form of reward because they put efforts and time to maintain the blockchain. The blockchain technology enabled Bitcoin to introduce itself to the system of extraordinary and transformative ability that has the ability to decentralise the process of payments.

Now the question is, why you should invest your money in Bitcoin:

Bitcoin is an investment platform where you can invest capital and can earn good profits with the application of some good strategies.

For example, if you mine $100, you can earn up to $500 within just twenty-four hours.

You can use Bitcoin to buy merchandise and can hide your identity. Also, with the help of Bitcoin international payments become very easy and cheap, as Bitcoin is not tied to any country or is subjected to regulation.

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Bitcoins are stored in the form of “digital wallet”, either in the form of cloud or in the user’s computer, the wallet is very similar to bank accounts that allow you to send or receive bitcoins, pay for goods and save money.

Bitcoin mining has helped a lot of people to fulfil their financial expenses and to reach their aims.


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