In short – what is Bitcoin? Or what is BTC? Bitcoin is a currency created by digital means and used as a digital payment method. Its value is not determined by commodity value or by the determination of one central body, but by agreement between the global user network.
The name Bitcoin is created from a connection between 2 terms: “bit” and “currency”. The first version of Bitcoin was developed in November 2008 by a group or person named Satoshi Nakamoto and whose identity is unknown to date.
And a little more than that – the currency is issued by technological means called “mining.” In this process, a great deal of computational power is devoted to issuing new usable coins. Bitcoin, unlike traditional currency, does not depend on a central body. Bitcoin is actually a record, in a public file called “blockchain”, blockchain. Its use is made possible by software known as a “wallet” which can exist on a local computer or remote server.
How is it working?
The Bitcoin system believes in process security and ensures that payments are made properly, that the amount of the currency in the transaction is deducted from the source wallet, and added to the target wallet. Payment targets are actually “Bitcoin Address”. The address itself is a string of letters or small or large Latin letters of 27 to 34 characters in length.
The amount of Bitcoin coins is limited and can reach as much as 21 million coins, which is expected to exist in the years 2110–2140. Bitcoin is designed so that it can never suffer from inflation (compared to traditional currencies) but its representative hair is unstable and even far from it, it is volatile at a level that does not exist in ordinary currencies.
Is it safe??
Bitcoin cannot be terminated (which would freeze growth in currency usage and abandonment) and can divide up to 8 digits after the decimal point – 0.00000001 (also called “stochey”), allowing a whopping upper limit of 2,099,999,997,690,000 bitcoin fragments.
Bitcoin’s legal status differs from state to state and there is still no uniformity. In Israel, as of June 1, 2018, entities that conduct Bitcoin trading will be required to be licensed and regulated, subject to the Money Laundering Prohibition Order on the relevant platforms. Bitcoin will be defined as a “financial asset” rather than a currency, so it will be required to pay VAT and capital gains tax if its value increases, and accordingly the capital loss offset rules will apply if its value drops.
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