Bitcoin – A Digital Currency of Modern Age

Bitcoin depends on crypto to exist, and crypto is the technique of encrypting or hiding information to protect it from being read or manipulated by the wrong people. In the case of Bitcoin, cryptography allows, among other things, that only the owner of the bitcoins can transfer them. You can trade bitcoin online and earn smartly with trading.

Now that answered the basic question, let’s move closer to the depths. Let’s understand why Bitcoin was born, who created it, how it can exist without being managed by a third party and what stage of development the technology is in. That’s what this guide is for. The objective that we set when we wrote it was that whoever read it would come out with a very good understanding of the basics and essentials and then, if they liked what they read, they would internalize on their own in our Blog and other places of those dimensions of technology where they doubts remained.

When was Bitcoin born?

Bitcoin was born in 2008 from the hand, an anonymous person (s) who published an academic paper that talked about a new form of digital “cash”. In that paper, the reason for creating this digital cash system was to eliminate the intermediaries that were historically required to transfer the digital money that we knew, such as the money that we keep in banks and that we transfer by accessing the websites of these. Satoshi was referring to that digital money, because it requires a third party – a bank – to be transferred from one person to another. And the problem was that these third parties incur significant costs to provide the services; costs that are then transferred to end users, such as:

Administrative expenses: from advertising the brand to the operational plan of people who serve the bank branches;

Security expenses: all costs associated with keeping safe the money they keep from their clients, either physically in vaults, security trucks, or guards, or digitally on their servers, employee computers, client accounts, etc;

Regulatory expenses: all the costs that these third parties must incur to respect the regulations in force in each country, which translates from state guarantees to access bank licenses, to fines or reimbursements for scams and frauds that are directly involved as institutions or indirectly through your customers.

The problem with these costs is that they are incurred by all customers and by obligation, because it is currently impossible to access digital money without being a customer of a bank. In other words, whether or not you agree with the way the financial industry operates, we are obliged to accept the terms in which it decides to manage its business if want to electronically manage our money.

In simple terms and in the eyes of those who use Bitcoin to pay, this is another form of virtual money, but “behind” Bitcoin is a computer protocol and a P2P (person-to-person) payment network that allows the transfer of economic value between people, without the need to depend on third parties.

And how can software that is not managed by anyone know how much each person has? Because Bitcoin maintains the record of the history of all historical transactions, from the first bitcoins created in 2010 to the transfers that are happening right now, as well as the balance of bitcoins that each person maintains, in a single, unique database, which is distributed and replicated in thousands of computers around the world, which “agree” on the version of history that represents reality. We call this database blockchain.

Choose a strategy and stick with it

The most important thing is to know yourself and know what is appropriate to your profile. Some people manage to make money with day trade, but it is definitely not a modality for everyone.

A more restless person may not feel comfortable holding their shares for years and checking the price every 3 months. To know your profile, you need to test it, it’s true. However, once you find out what is best suited to your profile, stick with the strategy. Each of the possible strategies has advantages and disadvantages, but changing from one to the other without criteria is a certainty of capital loss.