Bitcoin vs. Cash: Which is Which?by Oliver Brown Creative Artist
How does Bitcoin really differ from the cash in your pocket?
Many questions may be fueling the debate over the rise of cryptocurrencies, particularly Bitcoin, in today’s digital revolution. But among others, this one is the first thing that pops up when a person trying to learn about Bitcoin thinks of the matter. Why does the need for a new currency suddenly spring up when there’s already something in place?
Some would say that’s just how evolution works; that as society develops, so does everything attached to it. As for Bitcoin, the list of reasons is ever-growing, especially now that the platform’s becoming more global. But let’s try to understand it better by going back to the basics and draw the fine line between crypto and cash. Read this bitcoin guide to know their differences using the following bases.
Unlike the traditional currency as we know it, Bitcoin has no physical form. You can see it, but you can’t touch or hold it. Some like to call it the “internet money,” since the coins are made out of a series of encryption keys and programming schemes. That said, Bitcoin only runs through a virtual system, called the blockchain technology. Like the motherboard of a device, the blockchain manipulates all transactions made using Bitcoin. So everything about it is digital.
Money you use everyday, fiat currency, is under the control of a federal institution, government, banks, and other financial bodies. Bitcoin and other cryptocurrencies are not. Its creator, Satoshi, made it so to introduce a currency that can be controlled solely by its owner. This is where the red flag is usually raised by those who are still trying to learn about Bitcoin, but it makes much more sense than it sounds. While having no central authority controlling it, Bitcoin’s system is still under the hands of pioneer developers and programmers around the globe keeping the blockchain technology impenetrable.
Earning regular cash is easy. Fiat currency is still the primary currency used by every country, so acquiring it can be done in the simplest of ways. It’s easy to get Bitcoin, too, but it involves a slightly different process. Like exchanging your cash on hand, say, US dollars to Euros, you can acquire Bitcoins through online BTC exchanges for a corresponding price that depends on the index. You may be asking, if Bitcoin is digital, where does it go? You get to keep your coins in an online wallet, which you use when you engage in a Bitcoin-based transaction.
However, because of Bitcoin’s growth and popularity, there are now other ways to get your Bitcoin other than exchanges. Bitcoin can now be acquired through trading, buying and selling, freelancing, betting, and other forms of online activities.
You might have heard or read it in a bitcoin guide that BTC isn’t unlimited, and that’s true. Unlike traditional cash, Bitcoin has a fixed supply - 21 million - that will run out when the time comes. That’s the reason why many people jump into investment vehicles involving Bitcoin, knowing that its demand is increasing.
Created on Oct 24th 2019 02:58. Viewed 181 times.