Saturday, May 28, 2011
What is Bitcoin ?
Bitcoin is a digital crypto currency that could replace the fiat currencies of the world.
The bitcoin currency differs from national currencies because there is not central bank or other central controlling interest. It is entirely decentralized. Bitcoins are transferred between individuals or businesses by specifying their Bitcoin address. Transactions travel through the peer-to-peer network created by those who are running the Bitcoin client software.
Bitcoin is a peer-to-peer digital currency. Peer-to-peer (P2P) means that there is no central authority to issue new money or keep track of transactions. Instead, these tasks are managed collectively by the nodes of the network. Advantages:
Bitcoins can be sent easily through the Internet, without having to trust middlemen.
Transactions are designed to be irreversible.
Be safe from instability caused by fractional reserve banking and central banks. The limited inflation of the Bitcoin system's money supply is distributed evenly (by CPU power) throughout the network, not monopolized by banks.
Besides being important for maintaining the transaction database, mining is also the mechanism by which bitcoins get created and distributed among the people in the bitcoin economy. The network rules are such that over the next hundred years, give or take a few decades, a total of 21 million bitcoins will be created. Rather than dropping money out of a helicopter, the bitcoins are awarded to those who contribute to the network by creating blocks in the block chain." Bitcoins are potentially a better store of value than dollars . Paypal is based on dollars. Your account cannot be frozen and payments cannot be reversed. You can achieve better anonymity with bitcoin compared to paypal, because governments want payment services to track everything. Because of this bitcoin has the potential to rise in price even more than gold. Bitcoin is more like digital cash. Notice that cash dollars may disappear soon..
The bitcoin currency differs from national currencies because there is not central bank or other central controlling interest. It is entirely decentralized. Bitcoins are transferred between individuals or businesses by specifying their Bitcoin address. Transactions travel through the peer-to-peer network created by those who are running the Bitcoin client software.
Bitcoin is a peer-to-peer digital currency. Peer-to-peer (P2P) means that there is no central authority to issue new money or keep track of transactions. Instead, these tasks are managed collectively by the nodes of the network. Advantages:
Bitcoins can be sent easily through the Internet, without having to trust middlemen.
Transactions are designed to be irreversible.
Be safe from instability caused by fractional reserve banking and central banks. The limited inflation of the Bitcoin system's money supply is distributed evenly (by CPU power) throughout the network, not monopolized by banks.
Besides being important for maintaining the transaction database, mining is also the mechanism by which bitcoins get created and distributed among the people in the bitcoin economy. The network rules are such that over the next hundred years, give or take a few decades, a total of 21 million bitcoins will be created. Rather than dropping money out of a helicopter, the bitcoins are awarded to those who contribute to the network by creating blocks in the block chain." Bitcoins are potentially a better store of value than dollars . Paypal is based on dollars. Your account cannot be frozen and payments cannot be reversed. You can achieve better anonymity with bitcoin compared to paypal, because governments want payment services to track everything. Because of this bitcoin has the potential to rise in price even more than gold. Bitcoin is more like digital cash. Notice that cash dollars may disappear soon..
1 comment:
...sounds like hacker's heaven...
(I want to be encrypted...)
What's next? The Big Mac Teraburger?
Super-size it...uh, make that a quantum-size...and lots of ketchup
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