What is “Bitcoin” ?
In this post i am going share about What is bitcoin.
One of the more interesting recent developments on the Internet, has been the rise of so-called crypto currencies.Of which Bitcoin is probably the most famous and the first.
What is Bitcoin ?
Bitcoin is a digital distributed currency.It meets the requirements of a currency system .In ways that are very difficult an how they’re typically met today.
So there were other requirements that have to be meet in order for money. To actually have value so you might wonder why does this dollar bill in my pocket have value? why can I use it to? why can I exchange it for goods? and services.
Let understand with an example.
For most currencies the reasons that they have value come down. To essentially national power strength guns and black helicopters . for example if I could set up a printing press to make dollar bills .
In this building let’s say now obviously the government, US government and other governance make it difficult to do this on purpose. But if I could do that let’s say I can somehow set up a printing press. That makes dollar bills that are indistinguishable from the ones.
That are produced by the Treasury Department. I’m not going to be able to do that for very long before.The Secret Service shows up with their weapons drawn and I’m going to be in trouble.
So to some degree one of the reasons that money has value is because there are force there’s force. That is required to enforce the value of that currency.
What’s fascinating about Bitcoin and other digital currencies, they managed to do this without some sort of central powerful authority. That has an army. bitcoin has value you can go out today and you can use it to buy things.You can accept it as a form of payment you can exchange it for other currencies.So you can take bitcoins and convert them to dollars.
And you can use dollars to buy bitcoins. it has managed to maintain its value without any sort of black helicopters or men with guns.That’s really fascinating the technical details of Bitcoin.
I would encourage you to look at it.If you understand how and you understand sort of a little bit of the basics of how distributed systems work.
You’re pretty much ready to understand how Bitcoin works and you know. This might think about some of the common problems that occurrence II system. Particularly an online currency system.
Like Bitcoin has to handle so for example in a distributed currency system. How do I ensure that somebody doesn’t use the same virtual dollar.
Or virtual currency twice and this is a problem that Bitcoin solves. Along with a variety of other different problems that are required to produce a currency system. So I think it’s a really interesting testament to the power and the reach of the internet.
That we can actually use internet technologies and use sort of distributed systems. To start to replicate some of the core functions of governments and of entire countries.
- One of the primary functions of the US government is to maintain the value of dollars.If the value of dollar is somehow you know went away there are an entire society would crumble.
- I mean nothing that you got paid would be worth.Anything nobody would know how much money they were supposed to except for a particular product or service. Everything would just totally go haywire.
- And so somehow using you know very elegant cryptography Bitcoin is an open-source system. Which is really interesting so people can validate a lot people looked at it.
- But using these tools we’ve actually managed to recreate an entire currency system. that’s actually pretty cool so go online find out more about Bitcoin.
Advantages of purchasing “Bitcoin”.
Maybe try purchasing some bitcoins and using them. There are now a lot of different online vendors. That take Bitcoin in various forms for different types of transaction.
So that’s kind of fun it makes you feel futuristic to use bitcoins. To purchase something online bitcoins have an advantage. Which is that because of the technology behind them.
Rather than sort of the requirement of some sort of national power. The transaction fees that you pay to use bitcoins. When you purchase things and the transaction piece of immersions have to pay are much smaller.
Because a lot of the work of automating the work of that and verifying the transaction.
- And things like that is completely automate. Anyway you know bitcoin is an entire fascinating system. You could tell you teach an entire course based on Bitcoin.
- And the type of impact it’s having but it’s certainly something that is extremely interesting to think. How this is going to evolve in the future.
- If we start to be able to replicate core functions of governments online on the Internet.In a distribut system without any centraliz control. what sort of core functions will government’s need to perform in the future.