How Bitcoin Evolved As A King In Cryptocurrencies

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Asgar Hussain
May 01, 2019   •  1 view
Bitcoin

In the late earlier 9000 B.C the exchange of goods was possible through barter system, to overcome the problems of this system the gold standards and coins were introduced and later on paper currency is in circulation. According to recent facts of financial crisis; Russian Ruble, Zimbabwe currency and Asian country currencies lost its value, which lead to hyper inflation.

Further, To takeover these limitations, a global currency was introduced which is ‘Bitcoin”. In fact, we have been habited to purchase the goods through currencies, coins of domestic country. In the same way, Bitcoin is also a currency which we can't touch and it is invisible. It can only be digitally stored called Crypto currency, which doesn’t have any physical appearance. The transaction network is peer to peer where people directly involve through the use of cryptography. It was introduced in the year 2008 by “Satoshi Nakamoto” and the coins are standardized in “Satoshi”.

Bitcoin doesn’t have any regulations or any framework of government, as it is the first decentralized currency which isn’t controlled by any central bank authority of any country. We can use it as a digital currency for trading with an obligation to accept it by individuals.Bitcoin fluctuates heavily as it doesn’t involve any intermediary to control its value.

Most of the activities like dark web, deep web and few illegal activities of smuggling payments prefer the bitcoin transactions due to tax heavens and free regulatory system. Actually government shows interest in regular customers of bitcoin. Initially few vendors didn’t accept the bitcoin functioning. But as time passed, its value increased and the world accepted it as a virtual currency.

Bitcoin has its limit to create only 21 Million coins of which 14 Million coins have been already created. Here a bit of chaos would arise where the world population doesn’t match the count of bitcoins. Bitcoin has the divisibility factor up to 8th decimal where it could provide enough coins to circulate digitally.

Here a query arises that "Where does this bitcoin come from?". They aren't printed out as paper currency, they are mined out from the system by the Miner. Miner is a person who operates and runs the program with the software. We need to invest energy to extract Bitcoins. The electronic system solve the mathematical problems for which new Bitcoins generates to Miner. A small amount is paid to Miner for the transaction attained.

Generally, Miners get paid twice – once for verifying the transactions and again when they successfully generate new Bitcoins.Sounds profitable ? Well….not so fast… Satoshi, the guy who invented Bitcoin, wanted the number of Bitcoins that were mined each time to remain constant, no matter how many miners come aboard. That’s why the difficulty of mining increases as more miners join the network. For example if in 2017 you could mine 500 Bitcoins with your personal computer at home. In 2022 it will take you about 100 years to mine just 4 to 5. That’s why ASIC (Application Specific Integrated Circuit) miners were invented. Super powerful computers designed just for mining Bitcoins. But since so many miners have joined in the past few years it’s still almost impossible to mine alone.To solve this problem mining pools were invented. Groups of miners formed together to deal with the growing difficulty of Bitcoin mining. Each miner gets paid for his relative share of the work. So that’s how Bitcoins are born through miners.

Recently bitcoin has a massive spike compared to last year, it has reached to USD 20,000 ( in Rs. 12 Lakhs approximately). There is a myth where individual could control the value of Bitcoin by their power.

Many experts and corporate organizations accepted Bitcoin would be future of money circulation and could overcome the problems of present monetary issues.

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