Ok, what is that bitcoin?
It is not a real coin, but a "cryptocurrency", a form of digital payment generated ["mined"] by many people around the world. It allows instant peer-to-peer transactions on a global scale for free or at a very low cost.
Bitcoin was invented by software developers in the course of decades of cryptography after he was believed to be a pseudonym. He designed the algorithm and introduced it in 2009. His true identity is still a mystery.
The currency is not supported by tangible goods [such as gold or silver]; Bitcoin is traded online, which makes them themselves commodities.
Bitcoin is an open source product that any user can access. You only need one email address, Internet access and entry funds.
Where does it come from?
Bitcoin is mined on a distributed computer network of users running specialized software; the network solves certain mathematical proofs and searches for data that produces a particular pattern when the BTC algorithm is applied to a particular data sequence ["block"]. The game produces a bitcoin. It is complicated and time consuming and energy intensive.
To date, only 21 million bitcoins have been mined [the bitcoin currently in circulation is about 11 million]. Mathematical problems solved by network computers are increasingly difficult to control mining operations and supplies.
The network also verifies all transactions with a password.
How does Bitcoin work?
Internet users transmit digital assets [bits] to each other on the network. There is no online banking; instead, Bitcoin is described as a distributed ledger of the entire Internet. The user purchases bitcoin in cash or through a product or service that sells bitcoin. Bitcoin wallets store and use this digital currency. Users can sell this virtual ledger by trading their bitcoin to other people who want to be credited. Anyone can do this anywhere in the world.
There are smartphone apps for performing mobile bitcoin transactions, and bitcoin exchanges are spreading on the Internet.
How is Bitcoin valued?
Bitcoin is not controlled by financial institutions. It is completely dispersed. Unlike the real world currency, it cannot be devalued by the government or the bank.
In contrast, the value of Bitcoin is only that it is accepted as a payment method between users, and because its supply is limited. Its global monetary value fluctuates according to supply and demand and market speculation; as more and more people create wallets and hold and consume bitcoin, and more and more companies accept it, the value of bitcoin will continue to rise. Banks are now trying to value Bitcoin, and some investment websites predict that bitcoin prices will reach thousands of dollars in 2014.
what is the benefit?
Consumers and merchants who want to use this payment option have many benefits.
1. Fast Transaction – Bitcoin is instantly transmitted over the Internet.
2. No fee / low cost – Unlike credit cards, Bitcoin can be used for free or very low fees. Without a central agency as an intermediary, no authorization [and fees] is required. This improves profit margin sales.
3. Eliminate the risk of fraud – Only the Bitcoin owner can send the payment to the intended recipient, and the recipient is the only person who can receive the payment. The network knows that a transfer has occurred and the transaction has been verified; they cannot be challenged or retaken. This is a great opportunity for online merchants who are often constrained by credit card processing. Evaluate whether the transaction is fraudulent or whether the company has paid a high credit card refund fee.
4. Data is safe – as we have seen in recent attacks on retailers across the country. In payment processing systems, the Internet is not always a secure place for private data. With Bitcoin, users don't give up private information.
One. They have two keys – a public key used as a bitcoin address and a private key containing personal data.
b. The transaction is digitally "signed" by combining the public and private keys; the mathematical function is applied and a certificate is generated to prove that the user initiated the transaction. Digital signatures are unique to each transaction and cannot be reused.
C. The merchant/recipient has never seen your secret information [name, number, physical address], so although it is somewhat anonymous, it can be traced back to [the bitcoin address on the public key].
5. Convenient payment system – Merchants can use Bitcoin entirely as a payment system; they do not have to hold any bitcoin currency because they can convert Bitcoin to US dollars. Consumers or merchants can buy and sell bitcoin and other currencies at any time.
6. International Payments – Bitcoin is used worldwide; e-commerce merchants and service providers can easily accept international payments, which opens up new potential markets for them.
7. Easy to track – The network tracks and permanently records every transaction in the Bitcoin blockchain [database]. It is easier for law enforcement officers to track these transactions if there is a possibility of wrongdoing.
8. Micropayments are possible – Bitcoin can be broken down into one part per million, so a small payment of one dollar or less is a free or almost free transaction. For convenience stores, coffee shops and subscription-based websites [videos, publications], this may be a true gospel.
Still a little confused? Here are some examples of transactions:
Bitcoin in a retail environment
At checkout, the payer uses the smartphone app to scan the QR code and transfer all the transaction information needed by the bitcoin to the retailer. Click the "Confirm" button to complete the transaction. If the user does not own any bitcoins, the network converts the dollars in their account to digital currency.
Retailers can convert Bitcoin to US dollars as needed, with little or no fees [not 2-3%], no hackers can steal personal consumer information, and there is no risk of fraud. delicious
Bitcoin in hospitality
For hotels that wish to pay with a mobile wallet via Bitcoin or through a PC to the website for online booking, the hotel can accept Bitcoin as a room and dining fee. Third-party BTC merchant processors can assist with transactions that are cleared through the Bitcoin network. Users of these BTC smartphone apps that are installed on the tablet of the business office can dine at the front desk or restaurant. [These payment processors can also be used in desktops, retail POS systems, and integrated into food service POS systems.] No credit card or money is required to change hands.
These cashless transactions are fast, and the processor can convert Bitcoin into currency and deposit it directly into the bank account of the establishment on a daily basis. In January 2014, two Las Vegas hotel casinos will receive bitcoin payments at the front desk, restaurants and gift shops.
Sounds good – what caught?
Business owners should consider participation, security and cost issues.
• Currently, relatively few ordinary consumers and merchants use or understand Bitcoin. However, global adoption rates are increasing and tools and technologies are being developed to streamline participation.
• It is the Internet, so hackers are a threat to the exchange. The Economist reported that in September 2013, a bitcoin exchange was hacked and users stole $250,000 in bitcoin. Online vault. Bitcoin can be stolen like other currencies, so staying alert to the network, server and database security is critical.
• Users must be careful to protect their Bitcoin wallet with a private key. A secure backup or printout is critical.
• Bitcoin is not regulated or insured by the US government, so if the exchange is closed or hacked, your account is not insured.
• Bitcoin is relatively expensive. The current exchange rate and selling price are available on the online exchange.
Virtual currency is not yet popular, but it is gaining market recognition and recognition. To make it easier for customers, companies may decide to try to use Bitcoin to save on credit card and bank fees, or to see if Bitcoin helps or hinders sales and profitability.
Are you considering accepting Bitcoin? Are you already using it? Share your thoughts and experiences with us.