What is Bitcoin?
Bitcoin is a cryptocurrency which has had lots of mainstream success in media and on the internet recently. In short, it is a worldwide payment system and is the very first decentralized digital currency, because the whole Bitcoin network works without there being a bank at the centre of it.
There is no single administrator, owner or regulator of the Bitcoin cryptocurrency and all transactions take place between users. There are no middlemen or intermediaries, and this is why this currency can be used for a lot of purposes where you need to keep your identity anonymous, such as Bitcoin gambling, for example. Using Bitcoin for gambling easily bypasses territorial restrictions, making the cryptocurrency a particularly good option for certain countries.
Bitcoin was designed in 2008 by ‘Satoshi Nakamoto’, which is a pseudonym for the creator. This ‘Satoshi’ person could be an individual or a large group of people – we have no idea and may never know.
This person or these people designed Bitcoin and created the original reference implementation of it, which created the very first blockchain database. ‘Satoshi’ is estimated to own around $16.5 billion worth of Bitcoin.
Bitcoin is stored in a digital wallet which exists either on the owner’s computer or in cloud storage, and is a virtual bank account which enables its owner to send and receive bitcoins. Around eight years ago, 10,000 bitcoins was worth just about enough to buy a couple of pizzas. Now, the same amount would make you a millionaire, even after the large drop in its value.
This is just scratching the surface of Bitcoin; there is so much to be learned about this innovative and modern way to pay for things.
Is Bitcoin Falling?
The gains which Bitcoin made in late 2017 have gone into reverse, so it would seem. In January 2018, Bitcoin saw significant drops in value – more than $44 billion! This fall was spurred on by India’s ban on cryptocurrency trading and Facebook’s ban on digital currency adverts.
Just before Christmas 2017, Bitcoin was worth almost $20,000 per coin, yet this has fallen by over half. In early February, Bitcoin was worth less than $6,000 per coin. It is as if the ‘Bitcoin bubble’ leading economists warned us about has come about, and may soon burst.
The latest fall in Bitcoin came about after news that one of the largest online cryptocurrency exchange centres was being investigated by US regulators over its links to a digital asset which is accused of inflating Bitcoin’s price by billions.
But, will Bitcoin’s price keep falling? Well, there is no such way to make an accurate and reliable Bitcoin price prediction due to its model and core structure. Trading itself is too thin to be a useful indication and, until the volume of Bitcoin increases, prices are vulnerable to gaming. Also, major exchange platforms have incentives to front run, which can dramatically manipulate prices. Plus, market manipulation is as rampant as ever and it is structurally impossible to solve without regulation.
It seems as though Bitcoin’s biggest positives are turning on it and making it impossible for us to predict just what exactly is going on with Bitcoin at the moment.
If you want to learn more about Bitcoin, check out our infographic below or go to the url
Contributor: Karthik Reddy, Webmastersjury