THE BASIC CHARACTERISTICS OF THE BITCOIN
According to Yagli (2016) the main characteristics of Bitcoin are the following:
THE BASIC CHARACTERISTICS OF THE BITCOIN
THE BASIC CHARACTERISTICS OF THE BITCOIN
- Bitcoin is private and decentralized, that is, it does not belong to anyone and is not issued by a body such as a bank or organization, even a state.
THE BASIC CHARACTERISTICS OF THE BITCOIN
- It is a completely digital event which indicates that the currencies are issued by the network itself and can only be used within it. It has no impact on any underlying value (eg another currency or commodity) and so its value depends only on rules such as supply and demand for it, as they are shaped at any time.
THE BASIC CHARACTERISTICS OF THE BITCOIN
- It is characterized by a steady and predictable offer: the issuance of new monetary units takes place within the network with a specific and (almost) deterministic algorithm. Thus, every 10 minutes a fixed amount of new Bitcoin is issued – doubling every 4 years and today it is 12.5 Bitcoin – which is distributed as network nodes, which provide computing power to ensure such transaction integrity. It is reported that the production of new currency units will automatically stop when a total of 21 million Bitcoin is issued, which is estimated to be around 2130.
THE BASIC CHARACTERISTICS OF THE BITCOIN
- It has a transparent monetary policy: as the basic operating parameters of the system are embedded in its code, which is open and available to anyone who wants to check or copy it.
- Bitcoin is extremely rare, with only 21 million units issued.
- Bitcoin is divisible to eight decimal places, while the euro, for example, is divisible to two decimal places.
- Bitcoin can be stored easily, economically and for a long time. It is digital and therefore not worn or destroyed, like bank notes, and does not occupy any physical storage space. Of course, its ease of storage can be a challenge for users who are not familiar with digital media. You only need one Bitcoin, which is not necessarily associated with the holder’s identity, such as e-mails. This address has 34 characters that begin with either 1 or 3 such as: 1JnDxSc7kGsnkFs7aBWgo2AQkT67AKL3Vn.
- It is possible to transfer the currency units easily and without restrictions.
- As with all currencies, accordingly, the value of Bitcoin is directly related to the price the stakeholder is willing to accept as fair and reasonable. This means that its exchange rate fluctuates freely and is determined by supply and demand in the currency markets.
- Also, there is no guarantee of a state or a central bank, nor a gold prospect and its value is based on a mathematical algorithm. And yet its features are so reliable that its holders are more confident in it than in traditional coins.
In addition, Pazopoulos (2017) points out that a Bitcoin does everything it can with conventional currencies, such as buying and selling goods, but also sending money anywhere on the planet, almost free, without intermediaries, faster, safer and even anonymous.
Salazar (2017) also clarifies that transactions using Bitcoin are irreversible, cost-free and maintain the anonymity of the user.