WHAT IS BITCOIN AND HOW TO UNDERSTAND BITCOIN EASILY

 WHAT IS BITCOIN AND HOW TO UNDERSTAND BITCOIN EASILY

Hello Friends 

If you want to know about Bitcoin then you have come to the right platform.  Merely 12 years ago, On October 31, 2008, a person named Satoshi Nakamoto published a paper on the Internet in which he told about bitcoin.

Bitcoin is a cryptocurrency. Cryptocurrency is a digital asset over which the central bank or financial institution has no control. For example, the US dollar is controlled by the Central Bank of the US. RBI controls Indian rupees.  Similarly, no central bank or any main financial institution controls bitcoin or cryptocurrency.

Friends, before you understand bitcoin well, you will need to know the history of money.

STORY OF MONEY 

In earlier times there was no such thing as money. Earlier people used to give him rice in return for buying wheat. Meaning used to exchange things. There were many problems in this transaction. Just like I want sugar and you have sugar, but in return you want wheat, but I have only rice, so many problems started. Due to which we shifted to metals like gold and silver etc. But a lot of problems started in this too.  Like metals were very heavy.  Iron and silver coins were very heavy and it was not safe to carry gold, then such problems started. Then there is the third option in which the government used to say that you deposit your gold with us.  We will give you a currency equivalent to the value of gold with which you can transact.

But there was also a problem with this.  Many times the government wanted to print more currency due to an economic policy but it could not print more currency. As much as gold was deposited with the government, the government can print currency of that value. 

The money system was further advanced to overcome this problem. Now the government can print more currency it wants and on every currency, there is the sign of the Governor of RBI that I promise to pay the ₹ 100 or ₹ 200 to the holder.

Now the more money the government prints, the more inflation will increase.

There is also a problem in this, as banks give money on loan to some person who runs away with their money. The government had to take all the responsibility to give back the money of all those who had deposited the money in that bank and the government had to print more currency due to which the inflation increased further.

So cryptocurrency came up to remove all these problems.

WHAT IS BITCOIN 

 Now we will talk about what is bitcoin and how does it work? J1ust as you can send your money to another person through UPI, similarly you can also send bitcoins from one person to another.

Now we talk about how Bitcoin differs from UPI. 

The bank maintains all the transactions in the UPI payment, that is, the bank controls all these transactions. When your transaction is approved in Bitcoin, your data does not go to any bank or app, but it goes to millions of computers.

 What happens in UPI payment, if the government wants to inquire, then which bank account is linked to the UPI ID.  With this, she can detect the person who has the UPI ID, but this is not the case in bitcoin.  The government cannot find out which person has done the transaction? Because to start a bitcoin wallet, you do not need a PAN card, or Aadhaar card, or any other ID. 

Apart from this, it is also said that bitcoin is also used in other illegal activities.

HOW DID BITCOIN GET MORE VALUE? 

Now we will talk about how the value of bitcoin has increased so much in the last few years from 2010 to 2017?

There are two reasons for this.

1.  In the beginning, bitcoin gave a small return, so people started increasing their interest, due to which the demand for bitcoin started increasing a lot.

2.  The second reason was that bitcoin was very rare, due to which its demand started increasing a lot.

WHY DID THE VALUE OF BITCOIN DROP DOWN? 

Initially, people used bitcoin as an investment and invested their money in it.  Gradually most people went to invest in bitcoin and bitcoin gave good returns to those people. Due to which more cryptocurrencies came in like Ethereum, Tether, etc, as the value of bitcoin was very high here so people started going to other cryptocurrencies and started investing in them, due to which the value of bitcoin fell very much. Now the new cryptocurrency was going, it was better.  Transactions were fast in them. So because of all these things, the value of bitcoin fell down very much.

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