Things You Need To Know About Bitcoin
Bitcoin is a digital payment system that is neither issued nor regulated by governments or banks. This cryptocurrency was created in 2009 by Satoshi Nakamoto and has been dominating the crypto world since. Many coins have been introduced in its wake but Bitcoin continues to be the highest in terms of market capitalization. There are many interesting facts about the Bitcoin that you should know about; here are some of them:
- To begin with, just like real money, Bitcoins must be stored in wallets to keep them secure. Bitcoins are however stored in digital wallets that you can download and install on your computer or smartphone. Before choosing a wallet to store these you must evaluate its security features.
- Bitcoin prices are volatile and swing dramatically. Prices can soar and fall in a matter of days; so, it is advisable to invest in Bitcoins with caution. A smart investor should not put all his eggs into one basket. This means you should ideally spread your investments across multiple digital assets to make sure that losses in any one get offset by gains in another. Besides, you should only invest what you can afford to lose and not any more.
- Bitcoin transactions cannot be reversed; so, you need to engage in transactions with only those who can be trusted as reliable. While double-spending is unlikely in Bitcoin since it can detect typos, it is wiser to ensure that additional safety measures are in place.
- Unlike what most people think, Bitcoins are not completely anonymous. Al Bitcoin transactions are stored in the blockchain which can be viewed by one and all. However, the identity of users will not be visible. It is the onus of the holder to deploy good practices to protect privacy.
- Transactions made in Bitcoins have to be verified by miners before they are added to the blockchain. So, transactions are not really irreversible at the start; they have to get confirmation from the miners and this can take time; usually, within 10 minutes. Since the Bitcoin is still in a nascent stage, every improvement will make this crypto more appealing but challenges to its adoption will continue to increase also. It is during such times that confirmations may take longer than usual and fees may be higher. This is why it is best to consult technical experts before investing in Bitcoins. At the same time, you have to understand that none can predict its future.
- It is a well-known fact that the Bitcoin is not issued or regulated by national governments. While Japan and Australia are open to embracing it, Lebanon and Jordon have issued declarations saying they do no support it.
- At the time of its creation, the Bitcoin creator stated that there can only be a maximum of 21 million Bitcoins. Today, almost 18 million are in circulation and new coins continue to be mined.
- Since Bitcoin transactions were private and anonymous, it attracted cyber criminals and people engaging in money-laundering and purchase of illicit drugs and weapons. In spite of this, Bitcoin has been accepted by companies like Dell and Microsoft, Overstock.com and Expedia. With this crypto gaining more popularity, it can be expected that more and more businesses will start embracing this payment system.