You have probably heard of bitcoin, open-source software, or digital cryptocurrency, the value of which can only be exchanged in virtual space. The cost and value of the invention of an anonymous developer or group of developers under the pseudonym Satoshi Nakamoto are particularly interesting, even revolutionary. Especially considering that bitcoin is not subject to the powers of central banking systems.
Bitcoin = Anonymity, Autonomy, Decentralization and Independence
Bitcoin development is aimed at anonymity, autonomy, decentralization and independence from world governments, banks, corruption, malpractice and even ideological systems. What particularly catches our attention is the fact that the apparent value of cryptocurrency is not in financial terms. Bitcoin is revolutionary and innovative. Therefore the greatest value of digital money lies primarily in its transaction system.
The Revolutionary Bitcoin System
This currency is not printable and the total amount of money that can be created is limited to just 21 million bitcoins. As interest in bitcoin skyrocketed, so did the value of cryptocurrency soaring through the end of 2017. Let’s just mention that on December 17, 2017, bitcoin had the highest value ever achieved, but in just one year in December 2018, with turbulent exchange rate fluctuations, its value declined dramatically.
Although the price index varies, its actuality does not decline. This is supported by the fact that more and more people are interested in buying bitcoin, and that some countries have introduced this cryptocurrency as legal means of payment. Perhaps the discussion about bitcoin pricing today is not so important, but that is why the system that manages bitcoin is revolutionary.
It also hides the highest value of this cryptocurrency. Before presenting the true value of bitcoin, let’s explain in a simplified way how it works.
Why Is This Cryptocurrency Valued And Valuable?
Digital money itself does not have any particular innovative value, but it does have a system by which it is distributed. A successful and reliable bitcoin transfer is possible due to P2P or blockchain technology. To put it simply, it is a financial ledger that records the amount of money in virtual accounts as well as the entire history of bitcoin transfers online.
We can also interpret this transaction history as a chain of all transactions ever made, with a total sum of 21 million bitcoins in the future. We say in the future because the final or the total number of bitcoins made – has not yet been reached. A transaction or a block cannot be modified or deleted, which means that no criminal financial action can be taken. Very revolutionary, isn’t it? However, this is not the only level of revolution.
The next level of innovation is the decentralization of transaction records. There is no single central registry, but the entire blockchain file is stored on the node drives (or users, ie miners). Each new transaction is instantaneously recorded and updated with each of the users (nodes), and there is no “central authority”.
Application Of Digital Money In Different Countries Of The World
Bitcoin is a deflationary currency in the market. Besides digital payment, it is also used for other purposes. One such has been recognized in the facilitated international distribution of funds. Its good side is particularly emphasized in the case of migrants who can transact in this cryptocurrency in foreign countries. All can be done without the additional, high costs of international transaction services.
Another common purpose of bitcoin is to invest. Funding and buying bitcoin has become a major investment. Let’s just take, for example, that in 2017 the value of bitcoin doubled four times. Buying bitcoin at a low price and selling at a high has made a profit for many people on the stock market, which is another example of using this cryptocurrency.
What is the Open Interest Chart?
Anyone who has already entered the bitcoin trade seriously enough – knows that keeping track of statistics means managing information. In this sense, the term “open interest” is often referred to.
And what exactly is it? Bitcoin open interest represents actual open positions on BTC / USD trading pairs. This data is recorded from 2018. If open interest reaches more than 100,000 bitcoins – higher volatility in the price of this cryptocurrency may be observed.
Longs vs Shorts Interests
Longs and shorts data are provided to help users understand better the amounts of long and short positions that are open in valuing USD. Statistics are of the utmost importance here because they show users real-time data. According to bitmexresources.com – this kind of data is sometimes crucial to determine the values and predict the next steps in the bitcoin market.
Bitcoin As A Legitimate Cryptocurrency
The value of bitcoin currency varies and is interpreted differently from country to country. While some countries are more than determined to accept bitcoin as a legitimate digital payment currency in the country, there are also countries that, due to their inability to tax, avoid accepting bitcoin as a legitimate means of online payment.
In the US, the Internal Revenue Service treats all prominent digital currencies, including bitcoin, as property, not currency. In other words, every taxpayer who sells or buys bitcoin must report the value of the bitcoins used in the annual tax return. This tax regulation is also subject to miners who make a profit by “digging out” missing pieces of code in the blockchain. Unlike America, the European Court of Justice recognizes and treats bitcoin as a currency.
Although not subject to value-added tax, bitcoin is taxed otherwise. In Britain, the tax administration treats bitcoin as a foreign currency, where each case regarding this cryptocurrency is considered based on individual facts and circumstances.
In addition to these countries, it is also worth noting that the use of bitcoin will lead Sweden to the first cashless nation. However, in less developed countries or countries hit by financial crises, such as Venezuela and India, bitcoin is a means of legitimately paying for goods and services.
The Strongest Value Of Bitcoin
As we explained earlier, the greatest value and importance of bitcoin lies in its transaction protection system – the blockchain system. With bitcoin, for the first time, we have a system where corruption and other financial malpractices are not possible. That gave many people an idea to think more broadly. If it is possible to implement a system of protection and transparent presentation of the flow of money online, then maybe it is possible to apply this system in other spheres of ownership. In other words, the advent of bitcoin may be the first revolutionary achievement since the advent of the internet.
Its importance is primarily recognized in the blockchain system. This system provides security based on the interest of system participants in managing without fraud. Why? Because that’s the only way they can benefit from the system. Blockchain is even recognized as a system that is far better quality and more efficient than VAT. Once a block in a blockchain is printed, no further manipulation is possible.
The revolution made by bitcoin in the virtual space is very likely to spread more and more to other social forms and structures. That is why it is very important to follow the flows and technological innovations, to acquire knowledge and to improve. It is only a matter of time before the virtual guarantee of the Internet will be the only valid and secure system of social organization.