Satoshi Nakamoto is believed to have founded the first crypto currency Bitcoin, in the year 2004. No one knows the whereabouts of Mr. Satoshi so far. The reasons are clear. Now we find more than 1,000 crypto currencies in the world financial market although unregulated. When this article is being published, the Bitcoin was traded in the CEX 10 (Bitcoin exchange) for $ 6,000.
The most important feature of these crypto currencies is that the transactions are completed without intermediaries. No banking or non-banking financial institution is involved. All transactions are settled faster without any hindrances whatsoever. The parties to the transactions need not reveal their names and need not pay any transfer fees or transaction cost. These are the two reasons which have given rise to the discovery, evolution and growth of the crypt currencies.
The success of any business depends on the model or the mantras. The mantra followed Need and speed and the Blue Ocean technology: the need of the investors or businesses is to settle the transactions smarter and faster and this is found in crypto currencies including Bitcoin. There was no transfer of funds by without involving banks but crypto currencies there are no intermediaries for the transfer of funds. The names of the parties are not revealed. Crypto currencies have entered an unregulated market using cloud computing which has no competitors.
The ledger accounts of the investors and customers in these crypto currencies transactions are maintained by miners (accountants) by using high speed processing computers. These miners have a huge reward for solving a puzzle in every transaction of the Bit coin.
The Bitcoins are stored in Digital wallet, which can be found in cloud or on the users’ computers. This wallet is nothing but the bank account of the individuals who transact in the crypto currencies. The users of this Digital wallet can buy even a Pizza or anything using their public keys and private keys which are allotted to the users.
Small businesses generally prefer this system as no credit cards are required for the processing of the transactions.
The growth of Bitcoin from $ 1 to the $ 6,000 + or – is attributed to the Silk Road (on line black market) which needed a currency that could clear transactions without using banks. Even the closing of the borders of countries for legitimate business for various, has paved the way for business in these countries.
Calculation of the price of Bitcoin is done by CEX 10 (bit coin exchange) on the basis of the trade of the transactions. It has 100 million dollars market capitalization. Some of the international banks are trying to be a party of this block chain technology, which has a definite amount like the capital of the banks.
To invest one need not pay $ 6,000 dollars to buy one Bitcoin? You can buy even a fraction of that provided the country you live in, allows such transactions.
Future of Bitcoin: In spite of the unprecedented growth of the Bitcoin, it can’t be stated that, one should invest or transact though the Bitcoin as many governments have not supported it although some of them did support. The governments of various countries including the UAE, have not appreciated this technology as it might encourage illegal transfer of money for illegal activities
Investing in Bitcoin is like betting a T-20 Cricket International match. Anyone can win right? The theory of risk and rewards applies to this technology as much as it applies in the regulated markets.