Most people have heard of the term Bitcoin, but do not have a clear idea of what it really is. Simply put, Bitcoin is a decentralized peer-to-peer digital currency system designed to enable online users to process transactions using a digital unit of exchange known as bitcoins. In other words, it is virtual currency.
The Bitcoin system was created in 2009 by an unknown programmer. Since then, Bitcoin has attracted a lot of attention and controversy as an alternative to the US dollar, euro and commodity currencies such as gold and silver.
A private network of computers connected by a common program is used to execute transactions and process bitcoin payments. The creation of bitcoins is based on increasingly complex mathematical algorithms and is purchased with standard national money. Bitcoin users can access their coins from their smartphones or computers.
As a new and emerging virtual currency, Bitcoin has certain advantages over conventional government fixed currencies. Here are 5 benefits you will love when using Bitcoin
1) No taxation
When you shop in dollars, euros, or any other fixed government currency, you must pay the government an additional amount as tax. Each item purchased has its own tax rate. However, when you make a purchase with Bitcoin, no sales taxes are added to your purchase. This is considered a legal form of tax evasion and is one of the main benefits of using Bitcoin.
With zero tax rates, Bitcoin can come in handy, especially when buying luxury items that are sold exclusively overseas. Such items are usually heavily taxed by the state.
2) Flexible online payments
Bitcoin is an online payment system, and like any other similar system, Bitcoin users can afford the luxury of paying for their coins from anywhere in the world with an Internet connection. This means you can lie on your bed and buy coins instead of wasting energy traveling to a specific bank or store to get your job done.
Moreover, online payment via bitcoin does not require you to fill in the details of your personal information. Hence, Bitcoin processing of Bitcoin transactions is much easier than those done through US bank accounts and credit cards.
3) Minimum transaction fees
Exchange fees and costs are an integral part of standard bank transfers and international purchases. Bitcoin is not controlled or moderated by any intermediary agency or government agency. Thus, transaction costs remain very low, in contrast to international transactions made using conventional currencies.
In addition to this, Bitcoin transactions are not known to take long as they are not associated with typical authorization requirements and timeouts.
4) Hidden user identification
All Bitcoin transactions are discrete, or in other words, Bitcoin gives you the option of user anonymity. Bitcoins are like cash-only purchases in the sense that your transactions can never be traced back to you, and these purchases are never linked to your identity. In fact, the Bitcoin address created for user purchases is never the same for two different transactions.
If you wish, you have the option to voluntarily disclose and publish your bitcoin transactions, but in most cases, users keep their identity secret.
5) No outside interference
One of the greatest benefits of Bitcoin is that it eliminates interruptions from third parties. This means that governments, banks and other financial intermediaries do not have any authority to disrupt user transactions or freeze a Bitcoin account. As mentioned earlier, Bitcoin is based strictly on peer-to-peer system… Consequently, Bitcoin users enjoy more freedom when shopping with Bitcoin than when using conventional national currencies.
Digital currencies such as bitcoin are relatively new and have yet to be severely tested. As a result, many believe that there are risks involved in using bitcoin. Despite the potential shortcomings of Bitcoin, it is clear that its merits are strong enough to make it a legitimate contender to fight mainstream currencies in the not too distant future.