7 Things To Know What Is Bitcoins | Would It Be Safe To Invest In Bitcoins |
Hello friends, I am Manish Patel. Today I am going to solve all your Confusions related to Bitcoin through this blog. To understand what is Bitcoin and how does it work? bitcoin, you must have read a lot of blogs, but by the end of this blog, you will be able to understand that what is bitcoin?
To understand bitcoin first you have to understand the history of money. There was no money in earlier times. People used to exchange things to fulfil their needs. But one of its major problems was that the items that were already present with people could take the same things.
People started using metals to overcome this problem. People started using metals to buy something. But there also started a problem. Whenever something had to be bought, the metals had to be taken to the market.
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After this, people started printing notes to remove this problem. But there was also a problem. The government wanted to print more notes to improve the economic condition of their country.
But he could not do it even if he wanted to. Because the government can print money equal to the value of the gold it holds. That is, even if the government wants, it cannot change the economic policy of the country.
Hence the government has made to change in these old systems. Now the government itself started to price this currency. That is, now the value of the currency will not be decided according to the gold.
As much as the government wants it will now be the value of that currency. Now the government can print as much money as he wants. It is called FIAT money. That is money that can be printed as much as the government wishes are called FIAT money.
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When FIAT money came, that is, the government could print as much money as it wanted, then it caused two problems.
You must be thinking that if the government has the power to print money, then what is the problem in this? A few years ago there was demonetisation in India in which the government passed an order to the currency of its country and on seeing the whole currency became just a waste paper.
People who had cash, now the value of that cash is not left because the government had pulled back the price of that cash.
Its best solution is that you do not transaction your money in cash form. You keep your money digital. Like it happened during the demonetisation. People who had money in cash form, they had problems. But those people who had money in the bank or people who were doing digital transactions did not have any problem.
Whether the value of the cash or not, or the government has closed the money, your money is getting digital transaction, then you do not have any problem.
2. The government can print unlimited currency:
The universal truth of the economy of any country is that the more money the government print, the more inflation increases and if inflation increases then the value of our money kept in any bank will be reduced. In this way, we are able to see that both these problems are not being solved by digital money.
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After all, there is another major problem. Our entire ledger account and our bank details remain with the owner of that bank or UPI, which he can misuse whenever he wants. Apart from this, the government can ask for your transaction record from the bank and investigation it.
Apart from this, one of the biggest problems, we put our money in the bank and the bank gives loan to the wrong person. We must have seen a lot of news that people take loans of thousands of crores from the bank, but they do not repay that money. Then the government had to come in the middle and pay all those account holders from the money of taxpayers.
To pay this much money, the government will start printing a lot of cash. And we have already told you that when a lot of money is printed, inflation increases. Then the solution to all these problems is Bitcoin. Let’s know about what is Bitcoin?
What is bitcoin and how does it work?
Bitcoin is a virtual currency, virtual means that it has no physical form like other currency, it is a digital currency. This is a currency that you can neither see nor touch. It is only stored electronically.
If someone has bitcoin, he can buy goods just like the common currency. It works just like a UPI which has an ID. If we share that ID among people, then people can do money transactions on that UPI.
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Advantage of Bitcoin
Its biggest profit is that no one can maintain our transaction data like a bank or a UPI. Whenever we do the transaction of our money in the form of bitcoin, then its data does not go to any one bank or app, That data goes into millions of computers in the world.
It is not known from this that who is the person behind that bitcoin id. You do not need any identity card like a bank to open bitcoin id.
what is bitcoin price?
There is no control of the government of any country on this because the government does not issue bitcoins. By this, the value of the currency of a country cannot have any effect on the value of bitcoin. There is a demand-supply in the entire world, according to which the value of bitcoin is given.
Disadvantage of Bitcoin:
Its biggest disadvantage is that the identity of the owner is not known in it. Botkins is also used by some peoples for fairly illegal activities.
The value of bitcoins increased abruptly in 2017-18. Because bitcoins was new at that time. Due to which the demand for bitcoins among people suddenly increased. And when the demand for something increases, then its value also increases. This is why Bitcoins gave a very good return at that time.
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Buying things from bitcoins is not as easy as buying with currency. One thing is clear from this that people were buying bitcoins so that people could double their money. But it is not necessary that you get such a return every time.
After 2018, the value of bitcoins crashed completely and all the people who had invested their money in bitcoin lost their entire money. It is sure that bitcoin will do well in the future, but which bitcoin will do well, it is not decided. Where there is an issue of investment in bitcoin, I do not personally invest in bitcoins.
Friends, I hope that you have understood very well about what is bitcoin and how does it work. If you still do not understand what is bitcoin, then contact us.