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Bitcoin and Its Significance

Bitcoin, in other terms, refers to currency that is created and used electronically. No one can control bitcoin and it can’t be printed as well unlike other forms of currency such as dollars. Bitcoins are mainly used by people to purchase items electronically. What sets this kind of currency apart from other types of currencies is that it is decentralized. The bitcoin network can’t be controlled by anyone including institutions or large banks. Bitcoin is based on mathematics unlike conventional currency which is based on silver or gold. In order to produce bitcoins, one needs to be well equipped with a software that follow a designed mathematical formula for producing these coins. This software is an open source and the formula is made available to anyone who wants to use it.

Bitcoin is very easy to set up unlike other forms of currency. Conventional banks take most people in circles whenever they are trying to open bank accounts. When it comes to bitcoin, one is simply required to get a bitcoin address within seconds without being charged. With bitcoin, one can be able to open as many bitcoin addresses as they want without their identity being known. Your identifying information such as address or name isn’t linked to these addresses. Bitcoin however keeps a record of every transaction that takes place within the bitcoin network. Once you use the bitcoins publicly, one can tell the number of bitcoins stored within an address.

When performing a transaction using bitcoin, one isn’t charged any fee which is a major benefit of using it. Bitcoin is a very efficient way of transacting as one can send money to any part of the world and it arrives within a matter of seconds. As soon as the payment is processed, the money is able to get to the recipient. Bitcoin cannot be easily refunded. One cannot get the bitcoins back after sending them unless the recipient chooses to send them back.

Most businesses are turning to bitcoin when performing various transactions. The transfer rate for bitcoins isn’t affected by time or distance as it is fast. Each and every transaction conducted through bitcoin is very safe as it is encrypted. Since every transaction involving bitcoin happen online, they are well documented.

Creation of bitcoin acts as a form of reward during a competition whereby users offer computing power to record and verify bitcoin transactions into the block chain. Transaction fees and newly created bitcoins are the rewards for those users who are successful in the process which is also referred to as mining. Other forms of currencies, products as well as services can be exchanged using bitcoins.

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