Cryptocurrencies are becoming very famous now. More and more economical reviews are related to the changes that they are bringing to the world. In addition, new markets and stock are going to work with Bitcoin, Ethereum, TheCash and so on. Cryptocurrencies are not very old innovation. That is why very important is to find out and discover, how is going to be develop and what exact changes they have given to us. We can not avoid this process, because more and more transitions are being done with cryptocurrency. Information is an important part of the global market and information about virtual units will help the business to have clear view of the future.
The most interesting thing is that not everybody can explain – bitcoins, what is it? This simple question shed a light that any considering of the new technologies requires clear understanding of the terms. In addition, Bitcoin as an example of the most successful cryptocurrency is not an exception.
Bitcoin is an implementation of cryptocurrency, a digital currency, created in 2009 by Satoshi Nakamoto (probably a pseudonym) whose main purpose is to enable payments over the Internet directly between users without any third party intervention. Unlike many other currencies, Bitcoin does not trust any central issuer in the form of, for example, a central bank, which protects against political impact and monopoly-like payment systems. In order to maintain security and confidentiality, Bitcoin relies on cryptography and uses a distributed database scattered across the nodes that make up the P2P network to record transactions. This also aims to ensure, for example, that the currency can only be spent by its owner and irrevocably disappears from the owners’ digital wallet, and thus can only be spent once.
Bitcoin design allows more or less anonymous ownership and transfer of values through the P2P network. Each user’s bitcoin is saved in a wallet file along with an arbitrary number of bitcoin addresses. The wallet file can be stored on the user’s computer or at a third party offering such a service. In both cases, bitcoin can be sent over the Internet to anyone with a bitcoin address. Bitcoins P2P topology and lack of central administration make it impossible for authorities, for example, to artificially manipulate the value of bitcoin or induce inflation by producing more of them.
The security of the personal information in Bitcoin system makes it one of the most perspective thing on the market of exchanging. The anonymous of the sender – not only hackers are looking for, but also big corporations’ goal. It is because, as it was mentioned before, the authorities do not control your transactions. The profit of this is that 1 bitcoins to eur will not contain any taxes. The price are going to be clear.
In addition, it makes cryptocurrency one of the biggest rival of the government. And it is not only because that transactions are not giving money to the budgets. The problem is more dangerous. Transactions that are done by the cryptocurrency can be a part of the crime and make the perspectives of making bitcoins legal lower. Criminals can not send bitcoins by credit card by the can to it on the special markets. The security of the cryptocurrencies makes the work of the police more difficult because they can not limit the financial power of the criminal world. There are appearing more articles and reports that coins were used in illegal sectors.
This opportunity of the cryptocurrency can be used in not only selling drugs or weapon. It can be used as a part of corruption. It is an obvious fact, that the wealth of the politicians are check by the government institutions. However, they can not check bitcoins with his debit card. The way he achieved them – it is also a problem to discovery. The level of security of virtual currency makes real a potential impairmentof polity of every state. Moreover, it is not a hypothetical prediction. In the countries of the third world, the corruption schemes are appearing in big numbers. And we have no insurance that it will never happen in civilized countries.
However, we can say that not every transaction that are made in cryptocurrency is criminal. Beside the markets, that are working with crime, there are a lot of others that are proposing do it with normal exchange. You can exchange bitcoins debit card on the real money on your credit card, buy a great amount of goods, invest in some companies and so on. However, different markets work with different coins, so you should have properly ones to trade.
Nevertheless, the goal of any transaction depends on the people, who do it. If you want to just to trade, you have a possibility to do it. But we should find a solution of problem of illegal transactions.