We are all familiar with the inner understanding of the value of things, which gradually developed in the learning process of knowing the surrounding economic situation. However, when it comes to fiat currency, value comes from trust. As long as society believes in the fiat system, money will have value. The same can be said for Bitcoin.
You may not have thought about it, but the Bitcoin code gives it the characteristics of a traditional fiat currency, including scarcity, divisibility, portability, fungibility, and recognition. The main difference is that its decentralized structure has created a unique transparent financial system without intermediaries. Most importantly, it provided a revolutionary way to solve the problem of transferring value around the world. It can be used as a store of value, like gold, but unlike its physical counterparts, Bitcoin can be transported from one end of the world to another via communication channels in a matter of minutes.
Bitcoin is not easy to understand, and for many aspiring bitcoiners, the issue of assessing its true value is very acute. Let’s take it point by point.
- Scarcity. Unlike traditional paper currencies, which can be printed indefinitely, Bitcoin has introduced a digital scarcity: there can only be 21 million BTC. While fiat currencies are subject to annual inflation and lose some of their value, Bitcoin inflation is limited and controlled.
- Divisibility. One bitcoin can be divided into 100,000,000 satoshis. One satoshi is equal to 0.00000001 BTC, the smallest unit of bitcoin at the moment. This level of separation is built into the original bitcoin code. The division level can be changed to 16 or more decimal places if necessary, which means that Bitcoin offers infinite divisibility.
- Portability. Bitcoin can be transferred over the Internet, satellites, or even radio waves, making it the most advanced currency ever.
- Durability. As long as computers are serving the network, Bitcoin is 100% durable. It cannot be destroyed like physical cash and is more reliable than fiat currencies and precious metals.
- Auditability. Its blockchain ledger provides a permanent record of all transactions, and the open-source accessibility of the ledger allows anyone to view and verify previous or ongoing transactions and addresses.
- Decentralization. Nobody controls Bitcoin. Unlike traditional money, the bitcoin network and its transactions are not subject to censorship, control, or alteration. The decentralized nature of Bitcoin also eliminates the potential for a single point of failure, making it more resilient than traditional currencies.
- Availability. You don’t need to have a verified bank account to own or receive bitcoins. All you need is basic computer knowledge and an internet connection. The availability of bitcoin makes it extremely convenient for countries with insufficient financial access.
A general lack of knowledge and misunderstanding has led some to question whether Bitcoin has any value at all. However, as we can see, this is not the case. Ultimately, Bitcoin operates on a very secure network, and the cryptocurrency has significant value that its community, investors, and traders place on it. The more the network of Bitcoin users and sellers grows, the more secure and advanced the system itself becomes, the higher the value in fiat terms.
Ready to buy your first Bitcoin? Here are Finscanner’s picks for the excellent Bitcoin and crypto exchanges:
- FMFW.io (Bitcoin.com Exchange) — an exchange registered in Saint Kitts and Nevis. Here one can trade more than 200 digital assets. As main advantages, the platform highlights that it is secure, fast and that they have dedicated 24/7 support.
- OKEx — a cryptocurrency exchange created in 2014 by Chinese developer Star Xu. It makes it easy to buy, sell, or trade cryptocurrencies by offering over 400 trading pairs, including pairs with fiat. OKEx offers advanced financial services as well as excellent guides for anyone new to crypto. There are investment programs, a referral program, and additional bonuses.
- Binance — a crypto exchange founded in 2017 by Changpeng Zhao and registered in the Cayman Islands. It is the largest cryptocurrency exchange in the world in terms of trading volume, with more than 1.4 million transactions per second. The exchange strictly adheres to US regulations, is compatible with multiple devices, and provides safe and convenient trading.
Find more crypto products at the Finscanner marketplace to buy your first crypto, connect cryptocurrency payment gateways, send, receive or exchange your assets, and explore other functions as well!
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