February 28, 2014

What is Bitcoin?

Last night while I still awake and just watching international news on TV; there’s a quick flash that shows current market exchange along with bitcoin. Bitcoin is new to me so I began to research further on this. 

What is bitcoin? 
Bitcoin is a form of electronic money independent of traditional banking; it started circulating in 2009 and has become the most prominent of several fledgling digital currencies. 

Bitcoins has no central authority that governs its supply. Like other commodities and currencies, its value depends on people's confidence in it. 

 Its virtual currency relies on a network of computers that solve complex mathematical problems as part of a process that verifies and permanently records the details of every bitcoin transaction that is made. 

 How safe and volatile is it? 
 Bitcoins price in dollar was quoted on online exchange Bitstamp spiked from around $30 last year to $1,100 in December. By January it is equivalent to around $900 per bitcoin and on Tuesday price steadily decline to around $530. 

 In addition, critics say that bitcoin is too volatile to be widely adopted and warn of its lack of regulation and its use to pay for illegal drugs and other notorious transactions. 

 Where to use bitcoins? 
 Experts say bitcoins could be widely used on internet by consumers for online shopping and other electronic transactions. Some online retailers are now accepting bitcoin as payment but the number of online store is just limited yet for the next year it won’t be impossible to be implemented. 

 If this happen I can use the bitcoin I won last year from gathering likes for fan-page and buy travelite mandolin case at guitar center. 

How do we store, trade and spend bitcoins? 
 Bitcoins are kept in virtual wallets with unique keys. Transactions are made by sending bitcoins from one wallet to another unique key associated with another wallet in a cryptographic process that is verified by computers across the bitcoin network. 

 Bitcoin wallets can be stored offline or online at exchanges like Bitstamp and BTC-E.

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