This article is a gentle introduction to bitcoin and assumes minimal technical knowledge. These comments can be misleading and can confuse. By the end of this you should understand enough to participate in a dinnertime conversation about bitcoin, and not be mystified by the topic. As an electronic asset, you can buy bitcoins, own them, and dave hudson bitcoin wallet them to someone else.
14 million bitcoins that have been created, increasing by 25 bitcoins every 10 minutes or so, with an agreed limit of 21 million, the last of which should be created a little before the year 2140. Transactions of bitcoins from account to account are recognised globally in a matter of seconds, and can be considered securely settled within an hour, usually. What is bitcoin designed for? Paypal, whose rules you had to comply with in order to open an account and use, and whose permission you had to seek before being able to move the money. Put another way: if the internet were a country, bitcoin would be its currency. For the first time we have an entirely digital asset which can be controlled by the end user, without requiring signup with an institution. Payments of bitcoins can be made from one person to another, irrespective of geographical location or jurisdiction.
In situations where the normal financial system is inadequate, it can be a useful way of transferring value to anyone who has access to the internet. Just like other currencies, bitcoin’s price fluctuates. With time, conversion is getting easier and cheaper as more exchanges are springing up in more countries. I can imagine a group of freelancer developers or graphic designers in an emerging economy, who may not have access to banks or Paypal. Of course, there is still the question of how they can convert bitcoin back into local currency, but that’s an easier problem to solve then receiving the money in the first place. It’s worth noting that while bitcoin has spawned many other similar cryptocurrencies such as litecoin, dogecoin, bitcoin is still the most widely used and traded due to its network effect and relatively higher levels of security and robustness. A network of computers validates and keeps track of bitcoin payments, and ensures that they are recorded by being added to an ever-growing list of all the bitcoin payments that have been made.