BITCOIN (BTC) A quick rundown of what Bitcoin is and how it works:
Bitcoin… the first of its kind: Bitcoin got so large mostly due to its pioneering status as it was the first real-world cryptocurrency, This combined with BTC having a limited supply that could ever be minted, growing demand and enthusiasm just tipped it over the edge. Now we have the giant that is Bitcoin.
What is Bitcoin?: Bitcoin to put it simply is a decentralized cryptocurrency working on proof of work. It is a fully decentralized network allowing for all kinds of peer-to-peer exchanging using cryptography, decentralized protocol, and a mechanism enabling it to achieve a consensus on the state of any given periodically updated public transition ledger known as the blockchain.
Bitcoin is not just a currency it is also a software protocol and the monetary side is symbolized or marked with the “BTC” you can see at the top of every list on your chosen trading platform.
A quick history of Bitcoin: So this giant of a currency shook the world in 2021 when it exploded and shot right up to the moon, but it came from humble beginnings.
So BTC (as we will call it from this point on) was anonymously launched back in 2009 to a niche selection of Technologists. Bitcoin soon became a whale as of today (/0406/23) bitcoin transactions every day are in thebillions and 10s of them.
Pros and cons of Bitcoin:
PROS
BTC is fully decentralized meaning it’s not easily controlled or exploited by corrupt officials.
With BTC you have full custody over your assets, this means all of the control is in your own hands, and that makes things easier by eradicating the need for any third parties or intermediaries.
BTC is permissionless, enabling anyone in the world to access it completely separated from limitations such as Location, wealth, or identity. This makes BTC an open and very inclusive option.
Given the technological feats achieved with BTC, it probably comes as very little surprise that the security is amazing too, yet so simple. Using what is called Public Key Cryptography, this system can uphold the integrity and authenticity of transactions. Then if that wasn’t enough all transactions are irreversible and inviolated meaning, If transaction history can not be tampered with in any way on top of this there is no other way or option for hackers to Change transactions in transit.
The short version is, BTC transactions are safe because they are anonymous and unchangeable.
CONS
Unfortunately, BTC comes with its cons too and one of them being the price volatility making it trickier to use for average people on day-to-day spending because it is not as stable as Fiat currencies.
There are issues regarding scalability with BTC too as the blockchain BTC runs on has its limitations such as transaction speed and the growth of more new transactions can lead to congestion resulting in slightly higher transaction fees. As can be seen with Ethereum trading fees right now going to the moon, by itself by the looks of things.
There is also one level of market manipulation to be aware of, this can happen when very large holders of the crypto known as “whales’ ‘ make huge transactions sometimes disrupting the value of BTC both positively and negatively.
The final con I will share with you all today is that of the Energy consumption to support minding and transactions. The mining process of BTC, that proof of work I mentioned earlier is a very long and technologically strenuous one in that large computers are running 24 hours a day 7 days a week. When you have a warehouse full of these “computers” the energy consumption is tremendous, to say the least. Hopefully, within the next few years, the world will come together and figure out reusable energy in a big way as we have seen in companies like Tesla and SpaceX.
To conclude this article I’d first like to say that although cryptocurrency makes a lot of people wealthy there are a great many inherent risks to watch out for along the way.
It is a scary journey learning and investing in new technology but there was once a time when the wheel wasn’t there or the internet to bring it back to the 21st century.
I have laid out some useful context here in the hopes that a complete beginner will read it to gain a bit more understanding of exactly what this BTC they keep seeing and hearing about is and means for the world.
In my humble/non-expert opinion, BTC will be a safe bet for many years to come, Providing you are in it for the long run. There is a projected rise in all Crypto set to happen in 2024 many experts have said.
I used https://www.forbes.com/advisor/in/investing/cryptocurrency/bitcoin-prediction/ for some of the research, I implore you to delve deeperinto the exciting world of Cryptocurrencies and I wish you the best of luck in your future ventures into it.
Thank you very much for your time reading this today. If you have any feedback or questions for me I will reply very fast and ill try my best to be of help to anyone.