Bitcoin: The trusted cryptocurrency. Tobo Explains how?

Bitcoin is one of the several cryptocurrencies but first to become most popular. It was invented 2008 by a algorithm designer named satoshi nakamoto. A thinker who revolutionized cryptocurrency as early as in 2008. Unlike other currencies(Dollar, Yen, INR) Bitcoin is a decentralized digital currency. The Bitcoins are not deposited in banks rather stored in a bitcoin wallet. Strange right!!!

Currency transactions usually take place in the banks or via the banks thus banks play the role of intermediaries, while transacting via Bitcoin  requires only the sender and the receiver, thus peer to peer service, there are no intermediaries. These transactions take place using private and public addresses and are recorded in a distributed ledger called blockchain. The ledger is nothing but a register which stores all the transactions and information over mining of bitcoins.

Transaction means – Payee “ABC” pays or sends say ‘1’ bitcoin to receivee “XYZ”. ABC will use his/her private key which will only be known to him/her and public address of XYZ to complete the transaction. XYZ will receive the bitcoin in his/her wallet which is linked to blockchain via his/her public address.

Every account has 2 addresses

1. Private Key which is known by the account owner only and is kept safe not to be made public at any point.
2. Public Key which is known by all and is used to receive bitcoins.

The blockchain maintains the integrity of all the transactions taking place around the world.  For most of the people Bitcoin transactions seems safe while there are few who do not have confidence in cryptocurrency thus they spread negative news about Bitcoin. If you have trust then go for Bitcoin and enjoy trading over any genuine platform.

Well for those who believe in Bitcoin – Here is a true story In 2010 KFC accepted the Bitcoins as payment for pizza. At that point no one knew the value of bitcoins and 2 pizzas were sold in return of 10,000 bitcoins, well   that was one of the first transactions via Bitcoin and the costliest if we calculate the value of 10,000 bitcoins today(1 B = 19419 $ = 14,27,358 INR). 

When Bitcoin was created in 2008 a paper was published under the name “A peer-to-peer electronic cash system”  authored by satoshi nakamoto the inventor, creator, father of Bitcoin. He not only published the paper but implemented the Bitcoin software(blockchain) as open source code which was released in early 2009,  Nakamoto’s identity remains unknown even today,  it is known fact that he mined the starting block known as ‘Genesis block’ the first block in Bitcoin blockchain history. By the end of 2010  nakamoto mined nearly 10 lakh Bitcoins after which the whereabouts of him are still unknown.  

Bitcoin is the first blockchain based cryptocurrency in the world and is considered to be the most successful till date. True it is. The first few years after the initial release the bitcoin did not see much increase ints value. In 2008, 2009 the price was few cents, while in 2010 the price was few dollars only.

After the initial release lot of speculation was done by the market analysts,  Crypto experts,  CEOs of big companies, stock brokers and strategists over the  future of Bitcoin. What many of these people missed was the point that Bitcoin is based on blockchain it gets created by mining and mining, there is no Central Bank that managers this digital currency and the blockchain holds records of Bitcoin transactions known as a public ledger which is reflected or distributed and stored on millions of nodes periodically.

To understand more we will cover blockchain now. 

I will not go into much of the details because the blog is meant for even the laymen, I will thus explain few points like what is a blockchain.

Blockchain is nothing but a public ledger and a ledger is just like a register or a database where transactions are recorded. For example if a sender is sending the Bitcoin to a receiver that this particular transaction is stored in a block. Block is nothing but a group of transactions and several blocks form a blockchain. Now all these blocks are linked to the Genesis block. Remember I told you the ‘Genesis block’ is the first block in block chain and was mined by nakamoto.

There are several players in the market who are maintaining the network nodes and by several I mean millions of resources who are maintaining the ledgers. Ledgers are responsible for maintaining and carrying the integrity of the blockchain.

In the market there are several portals that allow the transactions of Bitcoins for example in India we have the biggest IT Service Private Limited, Zebpay which allows bitcoin trade.

Let’s move to the Bitcoin trend over the last 10 years. As I already mentioned in my previous blog that in the beginning when the Bitcoin was released in 2008 toll 2010 the price was not much it was like few dollars per Bitcoin. 

In between October 2013 to October 2016 the Bitcoin did not see much of a rise it hovered in between 1000 to 1500 dollars Bitcoin. In the early 2017 the prices started rising and it reached as high as $12,500 per Bitcoin while again there was a downfall in the prices and we did not see the rise until July 2019 when the prices soared once again to 11,000 to 12,000 per Bitcoin.

Then there was a sharp fall in the Bitcoin price in the market and several companies including the CEOs of the big companies started telling that Bitcoin is  an unstable cryptocurrency and people might lose a lot so most of the people lost interest in not only Bitcoin but in cryptocurrency. However it was temporary.

The Bitcoin saw its worst period in between 2018 and 2019 when the prices fell to $3,000 per Bitcoin. It was only in July, Augist 2020 prices starting increasing and now as of today 15th December 2020 the price is $19,000 a bitcoin which is highest ever.

For cryptocurrency lovers I would say spend some of your money into the Bitcoins as you know that total number of Bitcoins can ever be produced is 21 million, no one can mine the Bitcoins after that, instead people can only transact, so as of now the ledgers are keeping the records of mining and transacting but after the year 2140 ledgers will only keep records of transactions because no more Bitcoins can be mined after the year 2140.

For those who think that the chances of Bitcoin disappearing are very high let me clarify that the chances of Bitcoin disappearing are very gloomy and we should not worry about it because the public ledger of the blockchain is maintained by millions of network notes and it will take significant effort, by significant i mean 1000s of years to shut down the millions of nodes.

Guys believe it or not bitcoin is here to stay. Enjoy Trading.

10 years trend – From 99bitcoins

1 Year Trend – From 99bitcoins

🙂