Just a few weeks ago Bitcoin ₿ lovers celebrated the 11th birthday. In just a month, Bitcoin ₿ went from approx $4800 to $6800 (that's 412,000 to 607,000 in Bangladeshi Taka). Its a good turnover for bitcoin investors.
So, it seems like investing in Bitcoin ₿ is a great choice, right ? Hold for a second, you have much to know about it. Let's begin.
What is Bitcoin ?
Bitcoin, also represented as a crypto-currency, a virtual currency, or a digital currency, is an entirely virtual kind of money. It's sort of like an online cash edition. You may use it to purchase goods and services, but Bitcoin is still not approved by many shops and some countries have outlawed it altogether. This is a decentralized digital currency that can be transferred from user to user on peer to peer network, a network which doesn't need for intermediaries or a central bank or even a single administrator.
Who invented Bitcoin ?
In 2008, Bitcoin was first invented by an anonymous person or group of people using the name "Satoshi Nakamoto". It is believed that Satoshi Nakamoto invented Bitcoin, produced and implemented the original bitcoin core and whitepaper. Nakamoto also invented the first blockchain database as part of the implementation. Nakamoto was the first to address the double-spending problem with digital currencies using a peer-to-peer network in the process. It said that Nakamoto started the writing work of Bitcoin code in 2007. He released an October 2008 paper in the metzdowd.com email list outlining a digital crypto-currency called "Bitcoin: A Peer-to-Peer Electronic Money System." Nakamoto launched and released the network versions 0.1 of Sourceforge Bitcoin software in January 2009, which was awarded the mining of a block of bitcoin genesis (block 0). In a coinbased transaction in this row, references were made to the text "The Times 03/Jan/2009 Chancellor on the brink of a second bank rescue" by the UK newspaper The Times on this date. This note was considered both a date marker for genesis and a humorous joke about volcanic instability. Nakamoto collaborated with other developers on Bitcoin applications until mid-2010 and revised its own source code. He then managed Gavin Andresen the source code repository and network notification key, transferred several similar domains to various leading members of the Bitcoin community.
How does Bitcoin work ?
Let's begin with the basics. Any Bitcoin (or Bitcoins) is simply a data file that is stored on a smartphone or computer in the 'digital wallet' app. Bitcoins (or part of them) can be sent to your digital wallet, and Bitcoins can be sent to others. The blockchain is the public list for each transaction. It helps us to monitor the history of Bitcoins so that people do not have coins, make copies or cancel transactions. Bitcoin works in three major way.
- Decentralization
- Cryptography
- Supply and Demand
Let's begin with Decentralization. Decentralization is the mechanism by which authority distribute and disperse powers from central authorities. Most of the current financial and state structures are centralized, which means that a single highest authority, such as a central bank or state establishment, is responsible for managing them. The fact that each central authority often plays the role of a single failing point in the system gives rise to some critical drawbacks to this approach; each malfeasance in the top hierarchy, whether accidental or intentional, ultimately has a negative impact on the whole system. As a decentralized alternative to government funds, Bitcoin has grown, making it more efficient, profitable and democratic, thus unfailing. The technology behind it, is the blockchain that allows this decentralization, as it gives every user a chance to become one of the network's many payment processors.
Throughout the Second World War, cryptography was widely used. The signals have been converted into a language that nobody can decode. To read it, you will need to transfer it to the original message. To do that, you must have had a key. This was possible by mathematical formulas! The same cryptography is used by Bitcoin. Instead of interpreting radio signals, Bitcoin uses cryptography to encrypt transaction data.
Bitcoin uses the regular concept of supply and demand. Bitcoin supply is limited. The mining reward is halved in every 4 years. The next halving will occur in May 20, 2020. Bitcoin has a a total supply of 21 million coins; no more Bitcoins can be produced until there are 21 million Bitcoins. As of today 18,280,375 bitcoin are mined. We still have a long, long way to go to 21 million!.
What is Bitcoin Mining ?
You could hear the term "Bitcoin mining" and the west is the dream of the pickaxes. Bitcoin's mining is the transaction processing in the Digital Currency System, where records of Bitcoin transactions currently in use, known as blocks, are applied to the block chain record of previous transactions. Much more exciting, but still complicated, bitcoin mining is performed by powerful computers that solve the complex math problem (so complex that it can not be solved manually, and even incredibly powerful computers can be too difficult to tax). In order to overcome one of these problems, a computer has the luck and determination of finding gold in the sand box. Each of those problems can be fixed by a computer in 13 trillion at the time of publishing, but later. The mining system is two-folded . First, a computer solve these complicated math problems on the bitcoin network, they create new bitcoins, which typically are "bitcoin-mine," like mine gold is taken off the groand. You generate a new bitcoin in relation to the current coins. Secondly, by verifying transaction details by solving computer science issues, Bitcoin miners make the payment network safe and efficient.
Bitcoin mining on the CPUs of individual computers was originally conducted, which resulted in greater productivity with more cores and time. After that, multifunctional card systems, then programmable gate arrays (FPGAs) and eventually integrated application-specific circuits (SAICs) dominated the system in an effort to find more hashes and use less power.
Why Bitcoin Banned in Bangladesh ?
The first advisory from the Bank of Bangladesh was released in 2014 on the use of Bitcoin. Bangladesh is one of only six countries that consider Bitcoin to be "hostile." The provisions of the Law of 1947 and the Law of 2012 on Cash-washing offered protections against transaction in artificial currency. The Central Bank clearly disapproved of any transaction involving cryptocurrencies by not specifying that such virtual currencies were a legal tender provided by any nation, are not subject to and are not allowed for central payment systems that could cause economic harm to the public.
Bangladesh Bank recently released another "Precautionary note" on its website on 24 December 2017 due to its growing global success. Although the latest notification reiterates the laws referred to in the first document, 2009 has been introduced as another legislation that may contravene the use of bitcoin. In order to avoid legal and financial risks, people were also requested to avoid carrying out, endorsing and advertising all kinds of transactions through virtual currencies like Bitcoin, Ethereum, Ripple and Litecoin.
It is not clear on which basis 'warnings' have been given so far about bitcoin's lawfulness. The alerts also apply to the Terrorism Crime Act, although the Act makes no reference whatsoever to Bitcoin, cryptocurrencies or other currency.
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