When you think of blockchain technology, Bitcoin is most likely the first thing to come to mind. The original cryptocurrency has become a hot topic in the media, rising and falling in value throughout the years. Bitcoin certainly has a lot to say about the digital economy, although it does not say it all. And in reality, many of us have gotten it all wrong. Watch the video and read on below to uncover new truths about Bitcoin and the greater potential of its basic foundation, the blockchain.
"Bitcoin is a platform that hosts a digital ledger on which people can mine, store and trade bitcoins, a digital form of currency earned through a computer algorithm and tied to no central authority." -Bitcoin Magazine Ask five people about Bitcoin and you are sure to get a spectrum of responses. To some, Bitcoin is a currency of dubious origin. For others, Bitcoin is the possibility of a world unencumbered, where currency may flow freely without a third party. Despite positive and negative angles, Bitcoin is in its most basic form, a digital currency. Marketplaces called “bitcoin exchanges” provide individuals a way to buy or sell bitcoins using many different currencies. Bitcoins can then be used to transfer currency value without a bank or a middle-man. Bitcoins can be used to buy products on-line like Dr. Dre headphones, Microsoft products and items on Overstock.com. You can also book a flight on Expedia or Cheap Air. Review 7 Major Companies Who Accept Bitcoin here >>.
Why has Bitcoin Become So Popular?
- Initially Bitcoin was used to transfer payments without a bank or middle-main.
- While the public blockchain provides transparency of transactions recorded in a public log, only the wallet IDs are named, leaving anonymity without revealing the buyer or seller.
- People can send Bitcoins to each other digitally with a mobile app without a bank fee.
- Sending international payments are inexpensive and easy, since they aren’t tied to foreign exchanges, countries or regulation.
- Businesses are beginning to accept them because there are no credit card fees.
- Others buy Bitcoins for the investment, hoping for an increase in their value.
How are Bitcoin Stored?
Bitcoin and other crypto currencies can be stored in a Digital Wallet or Bitcoin Wallet. These “digital wallets” can be stored on a person’s computer or in the cloud. The wallet could be compared to a bank account where your crypto currency is stored and transferred. Users can send or receive crypto currency, pay for goods and services and save for the future. Unlike a bank, your crypto isn’t secured by FDIC.
A Bit of History
Back in 2009, an individual (or entity) introduced Bitcoin under the pseudonym Satoshi Nakamoto, contributing a new and innovative method of payment. In the midst of big banks abusing power, imposing large fees, and duping clients, early pioneers of Bitcoin wished to change the face of modern currency. They wished to eliminate the middleman, along with the fees and corruption that often came along with them. Building a decentralized system on a blockchain platform, consumers were finally able to control how their money was being handled, while receiving full transparency along the way. It was revolutionary! As Bitcoin has evolved, in other areas we have entered new territory in volatility and online theft. Fortunately, however, we have been left with the enormous potential of the underlying blockchain that ignited Bitcoin.
Bitcoin Vs Blockchain
While Bitcoin is a form of digital currency, blockchain is the very foundation of the platform. Blockchain is what made decentralization possible in the first place, bringing transparency and trust to the world of currency today. Bitcoin used the first public blockchain technology as a secure transport method for its application. Bitcoin is not the Blockchain. Bitcoin is an application The blockchain is the middle-wear, the secure plumbing, it’s the Brinks Armored Transport wrapped in an exotic high-speed race car. The blockchain is a series of transactions, information, or data, which are recorded and stored as data blocks. Each block is linked together cryptographically in order to form a chain of information (hence blockchain.) Now, this chain can get pretty complicated. Each block of encrypted code, which represents information, is distributed like a unique puzzle piece across the entire network. Each puzzle piece has a cryptographic link to the next piece.
Imagine trying to put all of those pieces back together! It makes it very, very difficult for anyone else, other than the person with the passcode to do so. Now with new innovations in future blockchains, security just got super-sized. With 64-digit private keys, QR codes, encrypted content, and cryptographic links, hacking incidents become very difficult to achieve. But first, we must get a few things straight. While many people believe there’s just one blockchain, in reality, there are many public and private blockchains. Cryptocurrencies like Bitcoin use public blockchains that are open-sourced and accessible to the public. Private blockchains like BlockCerts blockchain also use distributed ledger technology, although they do not make information open to the public. Instead, the Private blockchain may be used to store and access sensitive data, business applications, supply chain, and tailored business solutions. Only those with a Private Key may access information, which ultimately makes private blockchains:
- More secure
- More efficient
Each authenticated user receives a Private Key, a long series of numbers and letters unique to that individual. Additionally, each user will receive a QR code for another layer of security. Using these tools, individuals may unlock their own private vault of information and invite others to view and participate in the information as well. It is collaboration at its finest (and most secure.) Bitcoin has had its moment and it is time for blockchain to shine. In the digital goldrush, blockchain is the technology that will bring golden opportunities to any industry out there. And here at BlockCerts, we will hand you the right key for your success.