Bitcoin Understanding The Benefits Of Cryptocurrency Trading
Understanding The Benefits Of Cryptocurrency Trading
Cryptocurrency is a digitalised currency that uses encrypted codes and languages to complete transactions. It is a global currency that remains untouched by the central government or any other central authority. Therefore, there are no laws, rules or regulations governing its circulation, usage and functioning.
The most popular cryptocurrency at the moment is Bitcoin. Bitcoin uses peer to peer technology to facilitate instantaneous payments. Since no one owns or controls bitcoin, there is complete transparency of transactions available to the user. They can monitor all their transactions on their personal computer or mobile phones over the internet.
Introduction to Bitcoin:
Bitcoin is a faster mode of payment as it eliminates third party intervention. A buyer and seller can transact easily without the need of any intermediary such as a bank, financial institution or a credit card. Thus, people are considering bitcoin as a replacement of the traditional medium of exchange i.e. money.
Bitcoins are obtained by a process known as Mining. Bitcoin mining involves solving of various mathematical puzzles by miners. This is how bitcoin is obtained and used in the transaction process.
Reasons Behind The Popularity Of Bitcoin:
Low inflation risk: Inflation is a general and persistent rise in prices of goods and services and fall in the purchasing value of money. Thus, due to this the value of money keeps fluctuating and there is a risk associated with it. But bitcoin price is not affected by any such changes as there is no governmental control. It only depends upon the amount of bitcoin in circulation.
Low collapse risk: Since bitcoin is free from regulations and control there is not much likeness of the currency to collapse. It is a virtual currency and thus cannot collapse unless there is lack of demand. On the other hand traditional currencies like money have a collapse risk associated with them.
Simple, safe and cheap: Bitcoin is being considered a simple, safe, fast, and secure mode of payment. It ensures complete transparency and safety of transactions as you have your own cryptocurrency wallet. Bitcoin transactions also do not require large amount of fee for completing the transaction process which makes it cheaper mode of payment as well.
Easy to carry: Large chunks of bitcoin can be carried in your virtual pocket and you do not require any safety measures. They are stored in your computer’s memory and that works as your virtual pocket. Thus, this makes bitcoin easily transferable and you do not need to possess them in banks etc.
Untraceable: Since bitcoins are not regulated there is no probability of monitoring each and every transaction. Thus their existence cannot be removed. Also every individual gets their own unique address through their registered bitcoin exchange which is why they are untraceable.