If you buy only $1000 bitcoins in July 2010, now you will have more than $90 million in your hands from just $0.05 per pop seven years ago, the cryptocurrency is continuing to rise in value. What drives the bitcoin's surge in value? One reason is probably the latest improvement on faster transactions, and lower costs. Another reason might just be because more people know about it and are comfortable with it's idea of cryptocurrency – including investors. With the increasing number of mainstream traders and investors, the currency looks even stronger.
For the undiscovered, Bitcoin is a virtual currency created by a mysterious individual who uses the name Satoshi Nakamoto, although it is definitely not his real name. "Nakamoto" introduced his idea for cryptocurrency in a research paper in 2008, and it was implemented in 2009 as an open source code. The reason for creating Bitcoin comes down to the weaknesses that he saw in the current system of banks that debate currency, lack of privacy and security, predatory bank lending practices, and difficulties and costs by transferring money.
Bitcoin is actually not a coin, but a series of unique codes. And like today's dollar bill, Bitcoin has value because people give it value. Like gold, there is a fixed amount of bitcoins that can exist in the world-21 million. Bitcoin runs on a blockchain-digital ledger that records every transaction made in the Bitcoin network. Make it very safe because everything is public and all tracked it is the world's first Open financial network.
When people are increasingly wary of government control over individual assets, Bitcoin becomes more and more: your private bank that nobody can touch. Your bitcoins are stored in wallets. This wallet can be a digital or even physical wallet-wherever you think of a unique key-a long series of numbers that belong to you and your own will be safest. If you want to invest in Bitcoins, you can do it in three different ways: the first one, you can mine your own – which is very difficult. Because the competition to mine bitcoins increases, only those who have a strong computer and money pay the energy costs can follow the increasingly difficult calculation processing. Number two, buy some from online exchanges or number three you can buy stocks in the funds that invest in bitcoins. And if you want to monetize, you can do so by selling bitcoins directly to other users in exchange for another currency, or in an online exchange. The real-world value of Bitcoin may be slower to develop
As an everyday currency, it is still difficult to use. While there are several brick and mortar companies that accept currency-from chain hotels like Howard Johnson to a certain restaurant-it is still hard to use in the real world. Online, certain goods and services can be purchased in a currency. More and more companies and retailers begin to recognize currency growth, adoption will follow. For now, the value of the currency lies in its value-with Bitcoin holders closely watching its value rise, wondering when-if ever-to be refunded.
