21 Quick questions about Bitcoin [ANSWERED]

#1 What is Bitcoin?

Bitcoin is a digital currency. It’s internet’s currency. Unlike typical currencies like US, euro, et cetera, it does not come in notes or coins, though it can be used to purchase physical and digital stuff online.

Don’t worry (it’s quick)

#2 How does it work?

A Bitcoin software client is used to run the system.

#3 Who developed Bitcoin?

Satoshi Nakamoto did. Who’s he? Nobody knows. His “real” identity is a mashup of speculations made by his open source team members, fans and P2P community members. He claims to be a 37-year-old person from Japan, although even that has a thing for doubts to revolve. His excellence in English language, no availability of Bitcoin documentation in Japanese language points the detective in another direction.

Detective journalists have made several assumptions with logical points as to who might be the real Satoshi Nakamoto. By real I mean, the one who developed the concept. Like here Leah McGrath Goodman in Newsweek has made a point by speculating a 64-year-old American as the man in question.

#4 Why is it called crypto-currency?

Crypto means ‘secret’. The currency being discussed has been called as cyptocurrency by many due to the anonymous nature that it posses.

#5 What is double-spending?

Double spending is the risk of digital currency being used for more than once. It’s a issue addressed with the arrival of cryptocurrency (you get it!). The way Bitcoin addresses the problem is by hosting a public record of every transaction made pertaining to Bitcoins.

#6 What one bitcoin is equivalent to USD?

As of late May 2014, one bitcoin is equivalent to 445.13 USD. Live chart can be seen in the sidebar of this website. Just in the January 2013, one Bitcoin was equivalent to measly 13 USD. There have been many ups and downs up till now. Meanwhile the process, it even spiked upto 1200 USD per Bitcoin. That’s incredible!

#7 What are its pros?

Freedom – Send and receive payments anywhere, anytime. Unlimited.
Lower fees – Either very low or no fees are taken.
Fewer risks – Since it does not require sensitive or personal information, it’s way more secure.
Better security – Bitcoin system is set in a way that it gives full control to its users.
Transparent nature – Every payment made is recorded in a block chain or public ledger to use and verify.

#8 What are its cons?