The currency that you’ve never heard of still has many secrets left to unveil, but you’re familiar with its name: Bitcoin. What is it and what was Bitcoin explode about? The answer to that question is a lot more complex.
Some people think that it was the Silk Road. That’s right, sadly it’s true, and whatever your views on the infamous online marketplace (where you could purchase anything from drugs to firearms) but it brought Bitcoin into the limelight. For example, when Ross Ulbricht was arrested for his crimes, he had $28 million in BTC stashed away, which the FBI seized.
There are four main reasons why Bitcoin is here, and it won’t go away:
- As a solution against hyperinflation, Bitcoin explode :
This is probably the most popular reason why Bitcoins grabbed everyone’s attention in the first place — Argentina, Venezuela, and Zimbabwe are perfect examples of countries that could benefit from an independent currency like Bitcoin.
- As a solution against government seizure of funds, Bitcoin explode :
This one is probably less known than the previous one, but many people still remember when the US government banned citizens from owning gold or taxed away 75% of everyone’s savings in Cyprus. Bitcoin would be impossible to confiscate by any government, making it an ideal currency for anyone with something to hide.
- As a solution against payment blockades :
This is another one that fewer people know. Some countries block their citizens from sending money to foreign countries like Iran and Pakistan. Bitcoin circumvents these payment blockades, which is one of the reasons why it started gaining popularity in those countries.
- As a solution against payment censorship :
And finally, the fourth reason Bitcoin is here to stay; Bitcoin transactions are censorship-resistant, meaning that nobody can block you from sending or receiving money with Bitcoin. This makes it perfect for anyone who wants to circumvent big corporations like PayPal or banks when sending or receiving money.
This article will focus on the fourth reason Bitcoin came into existence; censorship-resistant transactions.
Bitcoin is censorship-resistant because its transactions happen through a decentralized network of computers (called “miners”) worldwide, and each transaction has to be confirmed by at least six different miners. This makes it impossible for anyone to attack the Bitcoin network successfully; whoever wishes to do so would have to control more than half of the network’s computational power.
This also means that nobody can block you from sending or receiving money with Bitcoin; this money (unlike your bank account) cannot be frozen, and there are no prerequisites for opening a Bitcoin wallet.
You can use it without exposing any personal information, but you don’t even need to do that since it’s possible to send and receive money with Bitcoin without having a wallet at all.
And last but not least: if you manage to lose your private keys or your password, there is no way anyone can recover them for you. That means that losing access to your Bitcoins has truly dire consequences; nobody will be able to help you get your coins back, and they will forever stay in the blockchain. This makes it safer than banking methods.
There is a reason why this currency skyrocketed to fame in the past few years, and it’s not going away anytime soon. If anything, its popularity is only expected to grow as time goes by, and while its current price is a little inflated, it will continue to rise in the long term. To get more info, check the things to know when spending bitcoin.
There is a lot of hype surrounding Bitcoin, but if you truly understand what it’s trying to accomplish and the reasons why people are using it, that hype makes perfect sense.
If you decide to invest in Bitcoin anyway, make sure not to keep your coins in an exchange; instead, consider getting a hardware wallet like the Ledger Nano S or Trezor. If you already own some Bitcoin, make sure to keep your coins safe by storing them in a wallet other than the one provided by your exchange.