Bitcoin made simple

A revelatory concept, cryptocurrency has fast become one of the most popular ways to trade money online. Eliminating the time-consuming need for intermediaries, bitcoin is the most popular tender within the world of Cryptocurrency.

So let’s strip this down, bitcoin is essentially electronic cash. Embraced by older and younger generations alike, bitcoin is a safe and seamless way to store money without the need for access to bank or card details. Contained within the wallet app located on users smartphones, the trading of all bitcoin is recorded on blockchain’s, which are traceable and authenticated security features. Blockchains are publicly transparent and trace the history of the bitcoins transactions. Unlike real cash, bitcoin cannot be falsified. An efficient way to anonymise wired currency, all bit chains are recorded unless the account code of users wallets are shared, no names or locations need ever be known. Therefore users confidence in their own confidentiality is improved and privacy can be guaranteed.

The choice of those disenchanted by the nanny state rule of banks and the governments, the popular appeal of bitcoins to is that the ownership of all currency is entirely yours. Access to your cryptocurrency value is fast and easy too. Bitcoin ATMs can be located the world over. Just like any hole in the wall, these ATMs accept your token bitcoin in exchange for physical cash. There are also bitcoin debit cards and cryptocurrency exchange sites such as Coinbase and Kraken which allow for instant and easy access to your money. Financial magazine Forbes recently reported that the bitcoin price has roughly tripled since the start of the year. At the time of writing, the value of one bitcoin is £322.24. This is forecast to increase over the course of the next year with the introduction of Facebook’s highly anticipated currency ‘Libra’.

A powerful digital currency, the development of blockchain’s, wallets and bitcoins is constantly evolving to appeal to a wider audience. Financial satirist Jerry Hurlihy stated recently that she believes bitcoin is the most secure financial currency network in the world commenting “The infrastructure that processes transactions is globally distributed and not prone to attack.”In countries where access to banks may be limited and currency weak, bitcoin offers a superior alternative to the less secure option of carrying cash and relying exclusively upon banks.

However, critics fear that the lack of governance within the world of Cryptocurrency leaves the door wide open for hackers to design software and bugs targeted at harvesting bitcoin users details and wealth. If a wallet becomes defunct or is emptied it feels unclear how to prosecute an anonymous criminal, stealing from an anonymous portal. Combating such crime Miners are employed to secure cryptocurrency networks, a system which chains together blocks of transactions which then become blockchains. Miners introduce each Bitcoin to test a system and are then reimbursed for transactions they make. A lucrative business form in itself, taking just 10 minutes to verify each bitcoin, Miners can make large amounts of money creating these blockchains.

Undoubtedly a complex world with a new vocabulary and concepts, those buying into the bitcoin concept early made a fortune. A favourite with venture capitalists and wealthy investors, cryptocurrency is a potentially profitable way to generate huge quantities of money, if strategically navigated and fully understood. Putting a healthy pressure on banks, the competition, to improve our access and ownership to our own money may ultimately be beneficial to us all, even if the idea of actually owning a bitcoin feels too risky to explore just now.