For those not familiar with what bitcoin is; It is basically a digital currency for which no banking system or even a government is needed. Open source software is used to operate the transactions. Many people are investing money in the bitcoin market because ever since it was introduced in 2009, it has become extremely popular among traders and investors. Even many merchants have started to accept bitcoins. For example, you can buy a web hosting service or even order a pizza with your digital currency.
When you are trading in the bitcoin market, you can trade anonymously. The currency is not tied to any particular country and there are even no regulations designed for it. Even small businesses are using bitcoins because there is no transaction fee involved in the exchange. If you have some savings, you can invest that money to buy bitcoins and to earn profit because the value of this digital currency is predicted to go up.
The market places where digital currencies are exchanged are called bitcoin exchanges. They are the places where people buy and sell bitcoins by using the currencies of their respective countries. You simply need a wallet software, open an account, and then buy bitcoins from the money you have in your account in order to become ready for the exchanges. People are even transferring digital currencies through their Smartphones. There are mobile apps available for this purpose. You can either purchase bitcoins from online exchanges or get them from special ATMs.
Mining is another option used in the digital currency market. It is a process in which traders have to solve mathematical puzzles to win bitcoins. It's a tough and time taking process, but if you get it right then you will win 25 bitcoins. This can just happen in 10 minutes.
Once you are into the trading game, you will get to store your digital currencies in a digital wallet. It will be your virtual bank account where you will store all your bitcoins. It is not necessary for you to disclose your name while you are exchanging bitcoins. You will trade with your bitcoin ID. It is meant to ensure privacy of the transactions. So, you can buy or sell anything and nobody can trace your transaction. The digital currency transactions are verified through cryptography. It is a series of mathematical algorithms, which can only be solved by powerful computing. That is what secures the system. So trading in the bitcoin market is purely safe and legal.
The system and the market itself have perfect control on how much bitcoins are being created. The system adjusts itself by making the mathematical problems difficult to solve and hence, only specific amount of bitcoins are awarded.
Bitcoin is not just some currency to invest your money in. In the near future, more and more businessmen are going to use it instead of credit cards just to avoid the transaction fee. It's going to be widely used form of currency in the coming days.
Source by Emma A John
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