Bitcoin is a digital money that was created in 2008 by Satoshi Nakamoto. Bitcoin can also be considered as a digital asset and a decentralized currency which secures peer to peer transaction on internet without involving any central bank or third party. Unlike traditional currencies Bitcoin involves internet and blockchain for completing a transaction.
BTC is an abbreviation of Bitcoin, there are only 21 million Bitcoins available. A fraction of Bitcoin is called SATS. There are 100 million SATS available in one bitcoin.
It’s easily divisible
You can divide one bitcoin into 100 million pieces (100 million sats), whereas 1 US dollar can be broken into 100 pieces (100 cents). This means that the world will never “run out” of Bitcoin. It can always be divided into smaller and smaller pieces.
Bitcoin: The King of Digital Currency
Bitcoin’s value is driven by its enforceable scarcity. One of the greatest characteristics of bitcoin’s properties is its scarcity. Not only is bitcoin scarce, but unlike gold it is also provably finite. There will only ever be 21 million bitcoin. Of which 95.5% are mined till date i.e. 20.05 million and last Bitcoin will be mined in year 2140. No other digital asset possesses an immutable monetary policy on the level of bitcoin. In other words, bitcoin’s monetary policy may be viewed as the most credible.
What makes Bitcoin different?
How Bitcoin works?
Bitcoin is a decentralized digital currency that uses cryptography to secure and verify transactions. Here’s a simplified overview of how it works:
- Decentralized Network: Bitcoin operates on a peer-to-peer network, with no central authority controlling it.
- Mining: New Bitcoins are created through a process called mining, where powerful computers solve complex mathematical problems.
- Transactions: When a user wants to send Bitcoins, they create a transaction and broadcast it to the network.
- Verification: Miners verify transactions using complex algorithms and cryptography.
- Blockchain: Verified transactions are added to a public ledger called the blockchain, which records all Bitcoin transactions.
- Wallets: Users store their Bitcoins in digital wallets, which can be accessed through software or hardware.
- Private Keys: Each wallet has a unique private key, used to sign transactions and prove ownership.
- Cryptography: Bitcoin uses advanced cryptography to secure transactions and control the creation of new units.
How to Get Bitcoin?
There is no need to buy a single Bitcoin has Bitcoin can be purchased in fractions. One way to get Bitcoin is to mine it using internet any person who has the availability of internet can mine Bitcoin.
The easiest way to purchase Bitcoin is through online exchanges that is like Binance, Coinbase etc. finance makes it easy for customers to buy, sell, send, receive and store Bitcoin without using any keys.
Decentarlization Of Bitcoin
Decentralization refers to how much control any one person, entity, or group may have on a system or network. In a decentralized network, consensus is achieved through a kind of voting mechanism. This system no single entity can control or restrict the data. In an open decentralized network, anyone is also free to join and no entity can exclude them as long as they follow the rules or protocol of the network. This allows the network to operate without intermediaries. The cost of higher decentralization is lower throughout of the network, or the speed at which information can pass due to the need for a larger consensus. The opposite of a decentralized network would be a completely centralized network where one intermediary controls all aspects of the network. The advantage to this is incredible speed and throughput as there does not need to be a consensus, but the disadvantage is the need to then trust this single intermediary.
The first is bitcoin’s decentralization. No one person, corporation, or government owns or controls the Bitcoin network or the rules that govern the network. As a completely decentralized network that is running open-source code, the participants in the network must adhere to the code’s rules that govern the network. The 21 million supply cap was written in the original bitcoin source code, which continues to run the bitcoin network.
What was the need for Bitcoin Invention?
Bitcoin has been the most important invention in an era of 5000 years.
As said earlier Bitcoin was created into 2008, the reason behind the creation or say the invention of Bitcoin has been the reason because of the corrupt policies used by the governments of the world. Rise of inflation, rise of corruption are the major requirements that Bitcoin eliminate as Bitcoin cannot be controlled by any third party by any government by any bank.
Bitcoin usually works on blockchain, that if any transaction has been made using Bitcoin it will be stored on blockchain and can be viewed by any person or organization who has been the part of the network.
Can Bitcoin be Considered a Real Currency in India?
In India, Bitcoin’s status as a currency is still uncertain. Following is the summary of the current situation:
- RBI’s Stance: The Reserve Bank of India (RBI) has not recognized Bitcoin as a legal tender or currency.
- Regulatory Framework: India lacks a clear regulatory framework for cryptocurrencies like Bitcoin.
- Supreme Court’s Verdict: In 2020, the Supreme Court lifted the RBI’s ban on banking services for cryptocurrency exchanges, allowing Indians to trade Bitcoins.
- Taxation: The Indian government has taxed cryptocurrency gains as income, indicating recognition of Bitcoin’s value.