Ahhh! Bitcoins! Scary Internet jargon that only geeks are interested in… right? Not exactly. Bitcoins are actually really, really cool – and once you understand what they are, it’ll all fall into place. So, buckle up! It’s time to find out how this currency can affect your life.
First Things First…
It’s a cryptocurrency. This means that it’s a digital asset that’s exchanged online. Don’t worry, we’ll get to what that actually means! Bitcoin has been around since 2008, but it’s only recently that it’s hit the mainstream in a big way. With the instability of a lot of currencies worldwide, due to changing political climates and other factors, this digital currency is really coming into its own.
It’s shrouded in a bit of mystery, but once you ‘get’ what it’s all about, it’s actually pretty simple to understand. Thankfully! The key points to note are:
- It’s literally all online. Unlike other currencies such as our Sterling, the Euro, or the Dollar, it will never be printed.
- It’s based on mathematical foundations, and it’s independent of any one central authority.
- It’s created by a community of people that anyone can join.
- The system runs on a peer-to-peer basis, so you complete transactions between users directly, without the need for a middle man. These exchanges are verified online by ‘network nodes’ and recorded for anyone to see in a public distributed ledger called the blockchain – the bitcoin is just its unit of account!
- Bitcoins are ‘mined’, which means they are created as a reward for competing – those in the know offer their computing power to verify and record bitcoin transactions into the blockchain. Doing this successfully means you’re rewarded with transaction fees or newly created bitcoins.
- Because of the ledger, fraud basically isn’t possible, as it holds everyone accountable in plain sight. It’s also not possible to just simply create more and more bitcoins. It’s not an unlimited currency, but it can be divided up into smaller units known as satoshis!
- You can transfer it instantly, anywhere in the world. All you need is an Internet connection.
- Besides being obtained by mining, bitcoins can be used in exchange for other currencies, products or services.
- Yes – this means you can use it to buy things electronically.
So, What Can I Use it for?
Bitcoin is being used for everything from getting a plane ticket right through to buying a pint at your local. One of the industries which took up Bitcoin early was the online casino sector, as it makes the industry more secure and provides fast and anonymous transactions. For instance, at Vegas bitcoin casino players can either exchange their money for bitcoins or mine them in the VegasCasino’s faucet. They can then use them to play a wide range of online casino games, from blackjack to roulette and video slots.
You can also buy takeaways, hire removal vans, and erm, even hire your own private jet. Don’t get too ahead of yourself though; as we’re not exactly able to rock up to every shop on the high street madly proclaiming that we’re rich in bitcoins. But if retailers like Girl Meets Dress are anything to go by, it’s actually cheaper for them to accept bitcoins than to process credit cards, so that list will be growing! A list of sites and places accepting bitcoin in the UK is here: http://bitcoinacceptedhere.org.uk/uk-bitcoin-merchant-directory.php and my favourite retailer Zeek are using Bitcoins too!!!
Why should you get all excited if you can’t even use it everywhere yet? Well, it may well be the future. Investing in traditional currencies is tumultuous at best at the moment! After shocking political decisions, they often crash. On the other hand, digital investments seem to be the way forward (http://www.mirror.co.uk/tech/time-invest-bitcoin-price-virtual-8271849 ), as bitcoin gets stronger. One guy invested $27 in 2009, and got an unexpected $800,000 windfall by 2013. If you want to save a tidy sum for your future… you never know but maybe this may well be the way to do so ;-).