The latest buzz word, in the world of digital currency, is Bitcoin.
Bitcoin is nothing but a virtual currency or a medium of conducting digital transactions, just like any other digital currency. So what make it better than our conventional currency?
Lately, the global interest in bitcoins has grown. So, it becomes extremely important to understand the base of this and all other forms of virtual currencies. Bitcoin, and its alternatives are all based on cryptographic algorithms which are encrypted. This makes the currency decentralized giving ownership to the user.These can be purchased through an online exchange or a Bitcoin ATM. Landmark feature of a bitcoin is that it can curb the chances of fraud and identity thefts, and hence is considered a safe mode of holding money.Bitcoins allow buying of goods and services online, as well as transferring money.
Below are a few benefits of using bitcoins which make it better than any conventional currency:
Bitcoin is digital and decentralized – With Bitcoin people get the liberty to exchange value without intermediaries which translate to greater control of funds and lower fees. It’s faster, cheaper, more secure and immutable. Cash is controlled by banks while bitcoin has owners.
Ease of online shopping: As we already know, Bitcoin can help us do online shopping. It’s like an e-wallet which can be created blockchain technology to store, track and spend digital money.
Less volatile than cash: Bitcoin has a global acceptance and is less volatile than cash / local currency. Due to this feature, it becomes easier to conduct transactions across boundaries and online.
No real way of keeping a track of conventional currency- The underlying technology behind bitcoin, which is, blockchain is what makes or breaks it. Thousands of computers in a distributed network use cryptographic techniques to create a permanent, public record of every single Bitcoin transaction that has ever occurred. This record will be very valuable for various things besides tracking payment. While there is no real way of tracking cash.
Great tool for investment- Bitcoin can be used all over the world without going through a conversion process. It is considered at par with Gold and combines the best of cash and gold while providing an open market and no restrictions imposed by banks or governments.
Bitcoin is peer-to-peer and open, yet secure and nearly frictionless - Bitcoin allows exchanging value over the internet without any intermediary and gives its users access to their balance through a password known as a private key. So it’s private, secure and at the same time,open.
Duplication impossible - There is no way of duplicating a bitcoin, unlike cash.
Great way of maintaining records for tax purposes: Once transferred, a bitcoins’ ownership also gets transferred. This means that two people cannot be transacting on the same value and this will help keep records healthy and simpler, especially for tax purposes.
Transnational digital currency – There are no boundaries to Bitcoin or cryptocurrency. No exchange values and no third party interventions. Bitcoin allows seamless transactions across nations with a ledger getting maintained at the backend.
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