The Basics of Bitcoin and What You Should Know

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The world financial system was taken by storm with the introduction of Bitcoin and other cryptocurrencies in 2009. After many years, it started to gain much recognition, and many industries began to adopt the system. However, many people have yet to understand the power of Bitcoin.

If you are a bettor, you can easily place bets on Kentucky Derby odds using Bitcoin. There’s more to that, but before you dive into using Bitcoin, you should read this guide to find out about the basics of Bitcoin and all you should know as a beginner.

History of Bitcoin

The story of Bitcoin starts with an unnamed personality nicknamed Satoshi Nagamoto. The idea of Bitcoin was to create an entirely new system that disrupts the traditional financial system. As a result, bitcoin was built on a research paper written by Satoshi Nagamoto. And in 2009, the first bitcoin token was released, changing the financial system forever.

With the emergence of Bitcoin, it was met with massive skepticism since the base technology is built on trustless transactions. As a result, accepting money with no traditional backing that couldn’t be held or seen wasn’t easy. However, with the crash of 2008, the idea of a decentralized financial system started to make sense. 

However, it wasn’t until 2014/2015 before Bitcoin hit the massive break crossing the $10,000 mark. Since then, the coin’s value has mainly been upward, and we’ve seen a whole new financial system come to life.    

Uses of Bitcoin

Bitcoin has many uses today. However, it didn’t start that way, as it was basically without value. But with many industries adopting the technology, the use of Bitcoin has seen massive growth. And since there is no central government control, people find it more appealing as they can do without the threat of losing everything to a bad government policy.

In that case, we have listed below some of the significant ways to utilize Bitcoin.

  • Buying and selling goods and services online. Online vendors can now accept bitcoin as a payment option for their goods or services.
  • Store of value
  • Trading against other currencies
  • As an investment

Regardless of what you decide to use Bitcoin for, you should understand that you are on a blockchain network. So, there are no central authorities to control transactions. 

Pros and Cons of Bitcoin

Bitcoin might promise a lot of benefits. However, it comes with some issues as well. If you are not careful, you can lose plenty of money to this system. That being said, here are some of the notable pros and cons of bitcoin that you should keep in mind.

Pros

  • It has not centralized authority control
  • Transactions are safe and secure
  • You can trade with many people all over the world within seconds
  • Transactions are traceable

Cons

  • It is volatile
  • Transactions are irreversible
  • It is not yet a global standard

You should understand that developers are working on ensuring that Bitcoin’s drawbacks are mitigated. So, we might see a flawless financial system with time.

Why You Should Consider Bitcoin

With the pros and cons we have listed and the uses of Bitcoin, there are plenty of reasons to consider. Although since it is not yet widely accepted by every industry, you need to look at the one that it is being heavily used before considering. For instance, using Bitcoin offers more benefits than fiat in the gambling world.

There are plenty of other reasons to consider Bitcoin, and with many things going on in the world, having a backup for your fiat is not a bad idea. Since government policies can barely touch bitcoin, you might want to keep it just in case. But you should have enough money to spare.

Bottom Line

Bitcoin is already growing, and its popularity is now immense. Many people have heard of it, and many people are switching to the system. So, we might just be at the start of something great, and maybe a shift from the traditional banking system.

However, Bitcoin is still in its early implementation phase, so it still has a long way to go. Therefore, you should be careful how you put in money.