By | December 26, 2019

What is Bitcoin? What is shape? And what is the function?

What is it? You might just be one of the many people who are curious about how the price of bitcoin continues to soar. Actually, what is it?


What is Bitcoin?

Many people think that it is a very confusing thing, even though is something that can be understood simply.

If asked what is it(abbreviated as BTC), then the simplest explanation is:

Bitcoin is a decentralized global transaction cash system.

Based on the journal written by the inventor (reported in Bitcoin.org), actually this is:

A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution.

Have you ever imagined how the transaction system (sell, buy, transfer money) occurs? Yes, there are always third parties who mediate, for example, banks (interbank transfers), Visa, Mastercard, Paypal and so forth.

Have you (from Indonesia) ever bought goods on Amazon or Paypal? What should the payment system look like overseas? For example, if you use a credit card with the Visa logo, how do you think the payment will work?
What’s the Difference between Visa Credit Card and MasterCard 02 – My Financial Card

Visa and MasterCard credit cards, two types of credit cards that are often used for online payment in Indonesia.

As we all know, every institution providing financial services (including banks) must have their accounting books. Surely there is time, energy and costs that must be spent to be able to run the transaction. That is why we (the customers) incur additional costs (charge).

Continuing our initial discussion, It changed and changed the cash book system into one global accounting system.

Of course, the benefits are reducing time and costs.

 Who Invented Bitcoin?

There are many people who say that Bitcoin was created by someone, even though every major discovery is always done by a group of people (one team).

Was discovered by a team or group of people by the name Satoshi Nakamoto.

The system designed by Satoshi is an open manner, meaning that the programming code can be seen and checked by everyone in the world.

So, there are no hidden secrets and the creators do not have a conflict of interest.
Satoshi Whitepaper – My Finance

Satoshi Whitepaper’s document that explains the Bitcoin system

If you are interested in knowing what a programming language or algorithm looks like, then you can research Satoshi Whitepaper.

The 9-page journal explains the mathematics and algorithm of a Bitcoin. You can download the journal material at Bitcoin.org (documentation).

 

3 Characteristics

The author is sure, besides wanting to know what it is, you still want to know what it actually does? Is it safe to trade with Bitcoin? and so forth.

Let’s just discuss the characteristics.
Characteristics 1: Bitcoin as a Payment System
Characteristics 2: Bitcoin as Digital Gold

One of the oldest investments is a gold investment. People (from ancient times to the present) view gold as a high-value object.

Is gold actually worth it? Gold itself has no value, gold is just a lump of stone.

Then where is the value of gold? It is rather confusing because everyone agrees that gold has a certain value (you can see: today’s gold price to know the latest price).

Why do people consider gold more valuable than other stones?

The answer is that gold has unit characteristics that make it a “store of value”, namely:

The amount of gold in this world is limited and rare. Gold has soft properties and can be melted and formed into small units.

Example: gold coins, 1 gram precious metals and so on. Gold is also stable, has no degradation, is easily recognizable and difficult to fake.

Characteristics

Bitcoin has all the same characteristics as gold, such as:

The number of  is limited, ie there is only 21,000,000 Bitcoin in the world.
It can be broken down into smaller units without losing the value of that unit (1 Bitcoin = 100,000,000 Satoshi – the smallest unit of Bitcoin, just like grams in Gold). We can buy less than one Bitcoin.
Bitcoin technology is also stable and will not experience degradation.
It is very difficult to make fake this, because of the Blockchain system.
You can move it anywhere in the world in a matter of minutes, regardless of the amount of Bitcoin.

That is why people refer to Bitcoin as digital gold, but digital gold is better. In essence, is like gold – this is why many people refer to Bitcoin as ‘digital gold’ or ‘Gold 2.0’.