The bitcoin is a super-geek phenomenon. Even for the geekiest of people, the bitcoin is considered geeky. The world is already divided between two things: one who sees the bitcoin as a new revolutionary invention, and the one who sees it as a joke. This article explains what the bitcoin is, the issues associated with its technology, its role and its place in the market today.
Despite its very geeky image, in September 2015, the Futures Trading Commission (FTC) officially declared the bitcoin to be in the category of commodities. It has, thus, taken the first step towards the regulation of virtual currencies. Bitcoin financial transactions and trading on specialized platforms must now be carried out in compliance with the rules governing the trading of commodities. Today, the big banks are also trying to exploit the bitcoin’s financial potential, in order to realize savings on financial transactions but also to set standards across the financial industry.
How does Bitcoin work and should people buy bitcoin? P2P + currency + cryptography = bitcoin. The bitcoin is an intangible currency, or crypto-currency, which allows its holder to buy goods and services on the internet. Unlike traditional currencies, the bitcoin has no central bank or central agency to govern it. Instead, the bitcoin relies on an extensive network of over the counter transactions on the internet. The bitcoin is, in a way, the result of the marriage between the idea of a P2P network (over-the-counter), cryptography techniques and the concept of money. The result is that the bitcoin is in the process of creating a new, completely decentralized, totally free financial system.
Who created this crypto-coin called bitcoin? The bitcoin is the work of a genius who calls himself Satoshi Nakamoto. That’s all people know. It could be a man or a woman. It could even be several people, but nobody knows. What does the bitcoin way of payment look like? A bitcoin consists of a private key and a public key. The public key is made of 34 alpha-numeric characters beginning with “1” or “3”. The public key acts as an electronic wallet. This one is anonymous. The private key is made up of 51 alphanumeric characters starting with the number 5. It is required to transfer bitcoins to another user on the network.