Bitcoin, an online currency is having a major impact on the global financial system. Banks everywhere are trying to understand and keep up with block chains, and the trade of bitcoins. The biggest problem they are faxing is how to tax the online coin. If you have never heard of BitCoin hear is some basics.
Bitcoins are a decentralized, anonymous and encrypted online currency. They were created by Satoshi Nakamoto, who in 2010 completely handed over his material and information to @GavinAndersen, however there is no clear inventor of the bitcoin algorithm itself, and there’s disputes on who truly did create them. They essentially allow peer to peer transfer of bitcoin, eliminating the need for banks, extra fees, and they keep your identity safe. It’s as easy as sending an email and virtually allows untraceable business.
So similar to a file sharing network, people can trade bitcoins with little to no fees. But where do the Bitcoins come from? IF you know anything about Americas economic history think about the gold standard. Bitcoins; through an advanced algorithm and conversion system, can be traded for USD. Like Gold, bitcoins have a specific amount, 21 million to be precise, and currently its estimated that only 15-17 million have been released. What I mean by ‘release’ is a process called Mining.
Through hardware processed through computer software, math problems are solved over and over again, and when correct, one is rewarded with bitcoins. These are how bitcoins are brought into the system, and generally as the price, and demand for bitcoins has increased over the years, the algorithms have gotten harder for the machine to process. Once they are mined however, all one needs to do is open up a bitcoin wallet to start using the online currency.
No one knows the future of Bitcoin, but it is most definitely here to stay, and with companies like Fortress investing( @WesEden @Fortress ) in it, it would not hurt to put a dollar of yours into a Bitcoin. You never know how much the market is going to go up by.