In this article, we are going to do a Bitcoin Review for you so you can understand what all the fuss is about this fairly new way to invest and make money. After all my blog is about money making tips and not every article has to be about affiliate marketing and Internet marketing.
One thing has caught my eye recently is the Winklevoss twins. Do you remember them?
They are the ones that sued Mark Zuckerberg for stealing their idea of a social media site which turned out to be Facebook. This was covered in the movie The Social Network (http://www.imdb.com/title/tt1285016/).
The Winklevoss twins settled for $65 Million Dollar on a lawsuit. They turned around and invested most of that into Bitcoin. You can read more about that in N.Y. Times.
My point here is that a lot of attention has been paid to Bitcoin. Even Dallas Mavs Billionaire Mark Cuban says the Mavs will start accepting Bitcoin as payment in the 2018-2019 season.
He said this in a tweet which makes sense to mean applies to Bitcoin as a currency.
“If they wanted to pay in blueberries, and I thought it made economic sense, I would let them pay in blueberries.”
Currently, Bitcoin appears to be in trouble. This is evident on the Bitcoin Network due to high fees and slow transaction times.
Here is an article I found interesting from a couple of months ago.
Is it legal to shut down a Bitcoin exchange while the price is falling?
Keep this in mind as we go through the basics and Pros and Cons of Bitcoin in general.
Overview Of Bitcoin
The number of people making money from Bitcoin trading has increased in recent years. However, most people still do not understand the entire concept of cryptocurrency.
What is a Cryptocurrency?
According to Investopedia….
“A cryptocurrency is a digital or virtual currency that uses cryptography for security. A cryptocurrency is difficult to counterfeit because of this security feature. A defining feature of a cryptocurrency and arguably its most endearing allure is its organic nature; it is not issued by any central authority, rendering it theoretically immune to government interference or manipulation.”
Apart from Bitcoin, there are other types of cryptocurrency in the market like Litecoin and Ethereum, but they are still not popular in the marketplace. However, the main focus of this review is Bitcoin in an attempt to understand the viability of investing as an investment option.
2. What is Bitcoin?
Bitcoin is a digital currency that was created by Satoshi Nakamoto in 2009. Bitcoin transactions are not in any way controlled by intermediaries like banks and other financial institutions. In other words, Bitcoin transactions take place within a blockchain network.
3. Bitcoin Pros
3.1 Fewer Risks for Merchants
Merchants are well protected from fraud and other types of losses as Bitcoin transactions are very secure. It is not possible to reverse Bitcoin transactions and personal information is not linked to the transactions. Therefore, merchants find it comfortable to transact using Bitcoins when fraud and crime rates are high.
3.2 Very Low Fees
Most Bitcoin transactions do not attract any fees. However, users fees is a small amount when they want to increase the speed of transactions. The speed at which a transaction is processed within the network determines the amount of money that one pays as a transaction fee.
Also, traders can convert their Bitcoin on digital Currency Exchanges into a fiat currency of their choice. The Digital Exchange exchanges charge lower fees when compared to other services like PayPal and credit cards.
3.3 Transparent Transactions
Apart from personal information, all information on Bitcoin transactions is normally available on the public ledger for everyone to access. The Bitcoin blockchain allows one to verify their transactions anytime they want. Therefore, it is very difficult for governments, organizations, and individuals to manipulate Bitcoin protocol.
3.4 Control and Security
The currency is safe for the network as transactions are controlled by users. Also, it is possible to complete Bitcoin transactions without tying the transactions to personal information and in the process prevent identity theft.
4. Bitcoin Cons
4.1 It is still Developing
The currency has some incomplete features considering the fact that it is still in its infancy stage. It is important to develop the new services, tools, and features for the currency to be more accessible and secure.
4.2 Risk and Volatility
Bitcoin price will only settle down after the currency has been accepted by more trading centers, Medias, and businesses. The demand for Bitcoin is due to its limited supply and this makes it to be highly volatile. The volatility will decrease with time but traders have to endure the volatile situation for the time being.
4.3 Lack of Awareness and Understanding
Most people are not familiar with the concept of digital currencies and this makes them reluctant to use the coins. There is a need to educate the public about Bitcoin before they can adopt the currency.
Summary My Bitcoin Review
After looking at the pros and cons of Bitcoin it is quite evident that there are some issues about the currency that need to be addressed. The fact that it is still a new currency does not mean that it cannot be used in business transactions.
The user is protected from fraudsters as there are no third-parties involved in the transactions. Therefore, Bitcoin is the currency to watch as most people continue to understand the concept of digital currencies.
There are going to be ups and downs as new competitors enter the market as well. As with all investing never invest more than you can afford to lose. Start slow and small, until you are comfortable with what is happening.