In this brief article I share some important points Bitcoin 4W1H format - What, Why, Where, Who, How. |
What is Bitcoin?
Bitcoin (symbol: BTC or XBT) is actually an online currency used to make online transactions without intermediaries by the central authorities. Meaning no body like the Federal Reserve or the banks that control Bitcoin. Bitcoin concept was introduced around 2008 by the developer by the nickname "Satoshi Nakamoto".
If we look today, fiat money (paper money) that we use today comes from supply its central bank or federal reserve their respective countries but to print money without reliance upon any. In other words printed money supply is unlimited. In fact even today the U.S. government prints $ 85 billion per month under the Quantitative Easing 3 (QE3).
Interestingly supply of online currency Bitcoin is not as unlimited. Bitcoin to be 'mined' by the 'miners' Bitcoin. Bitcoin mining is not out there but online as well. How to get Bitcoin miners is to solve a mathematical algorithm. Bitcoin miners are getting more and more difficult mathematical algorithm to be solved.
Because of that, Bitcoin limited supply, which as of today number around 12 million bitcoins. Bitcoin is traded 24 hours a day, every day. There is a short video that explains what the Bitcoin in easy to understand format and can be viewed on youtube.com
How Bitcoin Used?
This present age , we do a lot of transactions made online. The concept of shopping is also getting changed . No doubt there are many who like to go to stores or shopping malls to see and experience the first items to be purchased. But there are also some things we do not necessarily want to store to hold , reconciliation, see yourself live just about to buy .
For example, the book , just go to Amazon.com and we can find the books we want , but also can preview content before purchasing the book . If that is just a click on the ' Check Out ' . Many other examples , including gadgets . My sister bought the Samsung Note her own online.
If the seller of the item is in Malaysia may be we use online banking such as Maybank2u , CIMB Clicks and others, but if the seller is at Oversea we need a credit card, paypal ( paypal is also linked to a credit card & paypal charges around 4 % . Again high ! ) and the internationally accepted .
Here comes the role of Bitcoin actually . If we use a credit card there is an intermediary bank in the middle of our transaction while Bitcoin - an online currency , there is no intermediary between sellers and buyers. Managing more direct and simple.
Why Bitcoin ?
When a credit card transaction , the bank will usually charge around 2 % - 3 % per transaction . So this is seen as a drawback for a business reason to lower profit margins or some dealers charge 2 % - 3 % of this to their customers back .
Imagine if we buy gold at $100, 000 and payment is made by credit card . Then we charged 3 % of the transaction of $100 , 000 . How much is 3 % ?
That is also why Public Gold does not accept credit cards as a payment method at the moment as not to burden the customer .
So why Bitcoin ?
Moreover it is no intermediary to every transaction between the seller and buyer and also safe for use kryptografi strong charges by Bitcoin is low. Much lower than that charged 2 % -3 % credit card .
In addition, by using Bitcoin issue of cloning or identity theft online credit card can be avoided. Kryptografi sound system makes Bitcoin is very safe to use .
Controversy
In 2012, The Economist reported Bitcoin is gaining popularity because of its role in the market 'crafty' online. What is meant by 'market crafty'?
In October 2013, the FBI has shut down a market 'cunning' is the name of the Silk Road. Silk Road is a black market like ebay or amazon but goods are drugs! In operation the raid on the Silk Road, the FBI seized 1.5% of the total bitcoins available in the market.
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| Screen capture Silk Road before it closed the authorities |
On 27 November 2013, Bitcoin prices have surged to a record above $ 1,000 for the first time, an increase of 400% in less than a month. Bitcoin reached a high of $ 1.073 in the exchange market in Tokyo base of Mt. Gox, Bitcoin opertor best known in the market, compared to the $ 900 price of the previous day.
At the beginning of the month, the price of Bitcoin is only about $ 215.
Rise so dramatically in a short time makes some thought Bitcoin is as overvalued as well as demand & supply factors are also driving the increase. For some they see it as a 'bubble' of the asset is still considered a mystery by this crowd.
Where & Who?
Bitcoin is not backed by any physical asset and Bitcoin is also not carried out by any individual or group. Bitcoin value depends on the public's trust in the online currency.
Bitcoin has been legally adopted in the public community, business and investment is growing every day, but not yet accepted by large retailers like Amazon.com for the moment.
"Not just the Bitcoin community only say use Bitcoin is good and also has enormous potential. Even members of Congress and U.S. government agencies also agree with the statement "
Jinyoung Lee Englund
Bitcoin Foundation spokesman in Washington
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What Is Bitcoin