What is bitcoin and how does it work?
What is bitcoin?
Bitcoin is a digital currency secured by cryptography, transacted outside the jurisdiction of a central authority.
This currency was created in 2009 by a mysterious person who called himself Satoshi Nakamoto, and the currency was originally introduced to be used for payments that are not subject to government oversight, transaction fees, or delays in transfers - unlike traditional currencies "mandatory" (for paperwork).
Back in 2010, the price of bitcoin was about 0.003 cents per coin. In October 2017, the coin's price rose to $4,200 - although this value has been volatile, with swings and frequent daily moves.
At this time, hundreds of other virtual currencies have appeared, each with its advantages and applications.
However, few of these currencies have significant value, but Bitcoin has competitors in the form of ether and bitcoin cash, as well as, to a lesser extent, litecoin.
Commodity or currency?
Bitcoin was initially created as a method of payment, and in some specific cases, it works exactly as intended.
However, it lacks a widespread, in addition to being currently in a state of great volatility to be considered a real alternative to fiat currency: sellers need to constantly review their prices to deal with fluctuations in their value.
This means that bitcoin is primarily used as an investment more like gold and other precious metals than as a traditional currency.
Like commodities, currency bypasses the direct influence of a particular economy and is not affected by changes in monetary policy to a large extent.
