Bitcoin came on the scene around 8 years ago with the idea that it would take digital currency mainstream. However, like many other start-ups with the same idea at that time, it has not fared as well as it thought it would and its mission has since changed.
How bitcoin works
Bitcoin works with encryption methods to regulate the production of units of currency as well as verify the transfer of funds that operates independently of a central bank. Both people and business around the world to exchange money between other people and business, you can also mine for bitcoins by using specific software that solves mathematical equations. You need a bitcoin wallet in order to use or earn this digital currency.
How do you earn money with bitcoin?
You can earn bitcoins with mining using the specific software available, sell items to others, or perform functions such as writing a press release or a blog post for someone who will pay you in bitcoins.
You can also purchase bitcoins at the bitcoin exchange which can present some problems in itself.
Problems such as:
• Long wait times on the exchange.
• How to know you are getting the best price.
• Is it a real deal or a scam; like anything you need to do due diligence and be aware that scammers are out there – if it sounds too good to be true it probably is!
• The cost of the currency, since the value changes so quickly could change dramatically from the time you purchase it to the next morning when you go to use it.
What are the issues with this digital currency?
There are a few issues with bitcoin digital currency;
• The fact that it is digital means it is not a dollar bill or euro. It can be used online and only with those who accept it.
• There is no banking or governmental regulations with it. How do you recoup your money if there is a digital currency crash; such as the 1920s market crash that helped to bring about the great depression. On the other hand, because it has no governmental control or regulations on it the private person is in total control of their currency.
• Also, violent criminals or black markets could also use it.
• There are also other forms of digital banking and currency available that work as well or better than bitcoin.
• It is not entirely anonymous, while no names there are addresses.
Does it hold any real value?
While it does hold value, that value changes daily and by the hour. It could be worth $200.00 dollars per unit this hour and in two hours or the next day only is worth $20.00. The rise and fall of value seem to hold a certain risk to it, maybe even a greater risk than the stock market. The value of bitcoin only holds real value with those merchants and individuals who use it. In order to spend it, you must use a merchant who accepts bitcoins; unlike a debit card you cannot go to your local grocery store and purchase food with bitcoins.
The pros and cons
• The individual retains control of his or her currency without bank or governmental regulations and taxes.
• It can be used globally with merchants who accept it.
• Encryption is pretty good.
• You can use one of the exchanges to sell your bitcoins and have that money transferred to your bank account.
• There is not complete confidentially as address are attached to transactions even though names are not.
• It can be used by people who promote criminal activity easier than regular money can.
• There is no federal insurance like a bank, which if the market crashes your money will be safe.
What changes have happened and what will happen?
As with all technology, bitcoin included new upgrades and ways to use that technology have appeared, goals have changed with time and will continue to do so as each new technological breakthrough happens. Many companies such as Circle and Coin base are moving away from bitcoin, they see it as more of a large institution based currency instead of individuals using it to purchase stuff.
Many of the changes that these kinds of companies are looking it in order to turn into a way for large institutions and business to move money between them for purchases and payments are a long way from happening. Things to remember and think about. It is important to remember the pros and cons when deciding if using bitcoin is for you. Are you willing to take the risk of your digital currency with such a volatile change in worth from day to day even over hours?
You can purchase bitcoins; you can also transfer them to dollars on an exchange and have the dollar amount transferred to your bank account.
Will bitcoin stay available to private users or will it become only for businesses and conglomerates?
Where will bitcoin be in the future?
The future of bitcoin I believe will depend on the number of things:
• New technological breakthroughs.
• People who truly want to spend bitcoin money globally. Such as send money back home to relatives in another country, purchase something from a company without the need to use a credit card.
• Will it say accessible to the individual or will it become business only?