Bitcoin is finding its way more and more into the public consciousness. Since their rapid increase in value in January of this year, everyone who regularly watches the news has probably already heard of this crypto currency. Even if Bitcoin has lost a lot of value at the end of this bubble formation, it is well known and has earned its place among the recognized currencies and capital goods. Increasingly Bitcoin is also used as a means of payment – those who enjoy gambling are asking themselves whether they can also use Bitcoin. That is quite possible among other things with sport bets, about which one can inform for instance with https://www.bonus.net/ca/
How does Bitcoin work?
Bitcoin is a crypto currency. Like all other currencies of this kind, Bitcoin is based on algorithms. However, these must first be fed with data resulting from Internet use. Without the Internet, there could be no crypto currencies. With the help of the algorithms, the data is evaluated in a complicated process that consumes a great deal of computer power. This is called “mining”. The algorithm ends with the actual bit coins, which can be found here in the form of so-called digital coins. These are first “excavated” by the algorithm, so they only begin to exist here.
The total number of bit coins that can be mined is limited to 21 million. The more data is produced and the more computing power is available for Bitcoin, the faster all 21 million of these coins can be mined. So far only a small part of it is available. The limited number of coins also has a measurable effect on their value. If you understand a little about the laws of supply and demand, you know that the value of a good can increase immeasurably if there is strong demand for it, but its availability is limited. So a Bitcoin can become very valuable. However, the current fluctuating demand also causes the considerable price fluctuations at Bitcoin.
Bitcoin as a means of payment
Bitcoin is also increasingly establishing itself as a means of payment. In order for a currency to be truly full-fledged, it must be usable as an asset investment, as a unit of account and as a means of payment. Bitcoin can currently be used conveniently as a means of payment, but it is a rather risky investment and can only be used to a very limited extent as a unit of account because exchange rates fluctuate so much. Today, Bitcoin is mainly used by investors who are willing to take risks and by people who want to pay something. For example, some bars, hotels and restaurants already offer to settle their bills in Bitcoin.
Bitcoin is also becoming increasingly popular for transactions between private individuals. This is mainly due to the fact that you can buy and sell Bitcoin from almost any location, whereas with classic currencies you can’t do much with foreign exchange. Not only can Bitcoin be used from anywhere, it is also easy to make transnational transfers. In contrast to traditional banks, the Bitcoin system does not charge any fees, which makes this alternative very attractive. Furthermore, a certain waiting time has to be accepted for a traditional transfer outside the SEPA area. Bitcoin, on the other hand, is transferred almost immediately from one user account to another.
Convenience and anonymity
Bitcoin is a very pleasant means of payment. This assessment is based on the fact that Bitcoin enables a very unbureaucratic transfer almost in real time. Users are mainly in favour of Bitcoin as a means of payment because it allows them to enjoy relative anonymity. All you need is a user account at one of the provider portals and you’re ready to go. The transfer with the help of Bitcoin is unbureaucratic in the sense that a protocol is created directly, which is stored in the system and made accessible to both transaction partners. This means that Bitcoin does not have a central location that has to verify the data, as the data is immediately taken over by the process.
The appeal of Bitcoin
Bitcoin is particularly attractive for investors who want to make high profits with their money and are prepared to accept a high risk. But also those who do not want to rely on the traditional banking system for all their transactions may like Bitcoin. In contrast to established banks, Bitcoin is not supervised by a central body such as a central bank or a state. Rather, a decentralised system has been created in which the users of the currency can act autonomously.