You are reading this because you have heard a lot about Bitcoin. However, you may already be familiar with this digital currency. Blockchain and cryptocurrency technologies are in their early stages. And like most innovations, these technologies promise to change the way people live and do business. At the same time, some people are skeptical of Bitcoin’s ability to change conventional banking systems. If you are interested in trading bitcoin, visit bitcoin-code.it for a complete guide to trading cryptocurrencies.
The concept of Bitcoin began as a grassroots movement with people who saw the limitations of traditional banking systems. These people realized that conventional banking was dangerous because it did not protect their privacy and their money. Consequently, they did not give people peace of mind. Therefore, they have developed something that a handful of influential people or a single government cannot control. Instead, all people could access and use this payment system as long as they have access to the internet. Today the world has Bitcoin, a virtual currency with no regulatory bodies, governments or geographic boundary restrictions.
But Bitcoin may not usurp fiat currencies, credit, and traditional banks anytime soon. When credit and paper money replaced gold as a medium of exchange, this precious metal retained its value. However, Bitcoin has several advantages that make it better than traditional banking services. Here are a few.
Bitcoin eliminates the middlemen
To understand how Bitcoin removes middlemen, think about what happens when you make a significant purchase like a car, house or property. The process is long, with several obstacles to jump over. It involves notaries, lawyers and other actors. However, Bitcoin allows you to enter into contracts without involving third parties. And this reduces the costs and time for defining the transfer.
Anyone can access Bitcoin
In today’s world, many people cannot access traditional banking systems. However, these individuals have cell phones and internet access. In this way, they can invest, trade or use Bitcoin for day-to-day transactions. Ideally, anyone who cannot access traditional banking can use Bitcoin to raise capital. And this is especially essential for people in developing and underdeveloped countries where some people are underestimated.
No government oversight
Being decentralized means that no single entity or government can control Bitcoin. And this is a primary factor that differentiates Bitcoin from traditional currencies. Since no single entity, person or government controls Bitcoin, no one can devalue it or take it away from the owner, depending on his whims.
Elimination of fraud
Bitcoin is fraud-proof because it is decentralized and digital. Furthermore, no one can counterfeit this virtual currency as they can with fiat currency. Also, a person cannot cancel a transaction after sending bitcoins. Therefore, this virtual currency eliminates the chargebacks.
Bitcoin prevents identity theft
Traditional credit and debit card transactions are “pull” transactions. This means that the seller takes the cost of a good or service from the customer’s account. In addition, they obtain the personal information of the customers. However, Bitcoin uses “push” transactions. This means that you only send the amount you want the seller or merchant to receive. Also, do not share any personal information with the merchant. Therefore, you don’t expose yourself to identity theft when using Bitcoin.
Final Considerations
Bitcoin is a relatively new invention, with most people starting to know and use it. However, this virtual currency has several potential advantages over traditional banking systems. However, Bitcoin presents risks such as a volatile landscape that causes its value to fluctuate more often than fiat money. Also, the lack of a centralized authority to regulate it means you can’t file a claim anywhere if you lose your bitcoins. However, these challenges are typical of a new invention like Bitcoin.
