Cryptocurrency

Bitcoin originated with the white paper that was published in 2008 under the pseudonym“Satoshi Nakamoto.” It was published via a mailing list cryptography and has a similarappearanceto an academic paper. The creators’ original motivation behind Bitcoin was todevelop a cashlike payment system that permitted electronic transactions but that alsoincluded many of the advantageous characteristics of physical cash.

CASH:-

Cash is represented by a physical object, usually a coin or a note. When this object ishanded to another individual, its unit of value is also transferred, without the need for a thirdpartyto be involved .No credit relationship arises between the buyer and the seller.This is why it is possible for the parties involved to remain anonymous.

The great advantage of physical cash is that whoever is in possession of the physical objectis by default the owner of the unit of value. This ensures that the property rights to the units of value circulating in the economy are always clearly established, without a central authorityneedingto keep accounts.

DIGITAL CASH:-

An ideal payment system would be one in which monetary value could be transferredelectronically via cash data files . Such cash data files retain the advantages of physicalcash but would be able to circulate freely on electronic networks.A data file of this type could

be sent via email or social media channels.

BITCOIN:-

Bitcoin is a virtual monetary unit and therefore has no physical representation. A Bitcoinunitis divisible and can be divided into 100 million “Satoshis,” the smallest fraction of a Bitcoin.

• The Bitcoin Blockchain is a data file that carries the records of all past Bitcoin transactions,including the creation of new Bitcoin u nits. It is often referred to as the ledger of the Bitcoin Systems.

To use the Bitcoin system, an agent downloads a Bitcoin wallet. A Bitcoin wallet is software that allows the receiving, storing, and sending of Bitcoin units.The nextStep is to exchange fiat currencies, such as the U.S. dollar, for Bitcoin units. The most common

way is to open an account at one of the many Bitcoin exchanges and to transfer fiat currencyto it.The account holder can then use these funds to buy Bitcoin units or one of the manyother cryptoassets on the exchange. Due to the widespread adoption of Bitcoin, the pricingon large exchanges is very competitive with relatively small bid-ask spreads. Most exchangesProvide order books and many other financial tools that make the trading process transparent.