What Is Bitcoin
Have you ever heard of bitcoin? It is a virtual currency, which only exists on the Internet. Since its creation in 2009, bitcoin has been used more and more. It has even just been recognized as the official currency by El Salvador, a country in Central America.
It is a currency, like the euro or the dollar. Like all currencies, bitcoin is used as a unit of measure to value the price of things. It also serves as a means of payment, that is to say that you can exchange it for what you want to buy. But is bitcoin a currency like any other?
No, because it is virtual and only exists on the Web! No need for coins or banknotes: bitcoin takes the form of encrypted codes, which are bought and stored on the Internet. These codes can then be redeemed, much like e-mails, in order to make online purchases quickly and anonymously.
Unlike conventional currencies, bitcoin was not created by a state, but by computer scientists, in 2009. Consequence? No government controls its value, which can therefore vary greatly depending on demand.
Bitcoin has no physical existence and is not dependent on any central bank. It cannot be turned off: its system is based on a network, the “blockchain”, powered by tens of thousands of computers across the planet.
It should be seen as a giant ledger, reputed to be tamper-proof, in which the history of all transactions is listed. Little is known about the creator of bitcoin, the very mysterious Satoshi Nakamoto. Its existence boils down to a few traces on the Internet. There are no photos of him and it is very likely that his name is a pseudonym.
Most of its work was done in late 2008, as the financial crisis began. Many specialists see his project as a way of freeing himself from banks and states, whose responsibility was then called into question.
But Satoshi Nakamoto has never confirmed these claims. Evoking in his writings the origin of bitcoin, he is content to point out the technical shortcomings of the time. Its ambition is therefore to develop a more efficient alternative system. The mathematician starts from the premise that we are forced, in order to guarantee our transactions, to have recourse to financial institutions.
This situation, he said, leads to excessive costs and the acceptance of a certain amount of fraud. “What we need,” writes Nakamoto, “is an electronic payment system based on cryptographic evidence, which would allow two parties who so wish to transact directly with each other without resorting to a trusted third party. ” Thus was born bitcoin.
In recent years, for example, the value of bitcoin has skyrocketed because more and more people have applied for this currency. This is a good deal for those who bought inexpensive bitcoin some time ago and are now going to resell it for a high price.
But beware of the risks! Because, if one day the demand drops, the value of bitcoin will fall and the savings will fly away. And then no one is safe from hackers who sometimes commit thefts online. So it is better to think carefully before converting your money!
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