Bitcoin is something that we come across a lot in newspaper and in general discussions around. But many don’t know what it really is and how it is relevant as an investment option as money?

Bitcoin is not a sort of printed currency like Rupees, Dollars, Euros etc. It is produced by computers using free software all around the world. It facilitates payment to be sent between users without having a sanctioning central authority.

Bitcoin in simple words can be defined as a crypto currency or a digital currency.  It uses rules of cryptography for regulation and to circulate units of currency.  Such crypto currency is generally categorized as a decentralized digital currency.  Who is the inventor of Bitcoin?

It was invented by Satoshi Nakamoto in 2009 as an electronic payment system based on mathematical proof. The interesting fact is that no one really knows who this Satoshi Nakmoto is. Some confusing aspects are there about Bit coin. To make it simple, it can be separated into two parts. On one part there is bit coin which is a token with a snippet of code that embody ownership of a digital concept. The other one is a distributed network that maintains a ledger of balances of bit coin-the-token.

In simple terms it can be explained as a completely virtual coins made to be ‘self-contained’ for their value and it requires no banks to transfer and store the money.

Bitcoin can be used to purchase goods and services online. You can also simply store them hoping that their value increases over the years. It is traded from one personal wallet to another.  What is wallet?

It is a small database that is stored in your smart phone, computer drive, cloud or 

in your tablet. How does it function?

Initially it was known as crypto currencies. Earlier the plan was to develop a currency not bridled by the government or business, that can be traded globally, having no cost and without revealing your identity. Its popularity resulted in copycats named ’altcoins’. Now there is second generation currencies that are virtual named Ethereum and Bit coin cash.

Bitcoin currencies use “Crypto graphic proof instead of trust, enabling two concerned parties to transact directly with each other without the requirement of trusted third party. A blockchain that is cryptographically secure is used to record payment transactions. In every 10 minutes new bit coins are released at a rate of 25 new coins. It’s output will soon come to an end as it was envisaged not to release more than 21 million; already there is 16 million in use.

The line numbered ‘code’ made out of computer programming once purchased can be exchanged for some goods and services like normal money. Investors enamored by it try to capitalize on the trend while other investors are cautious about it.  Where to get Bitcoin?

Normally once can receive them as payment for goods or services. A person can buy them directly from individuals or special website called ‘exchanges.   Future of Bitcoin.....

In advanced stage there could be an autonomous financial future commanded by machines rather than humans.

Now we have second-generation crypto currencies like Ethereum which can execute smart contracts. It operates using pieces of computer code that can interact with other coded contracts and perform work like moving money around and making decisions.

There have been so many warnings circulating around about Bit coins. It was mainly because