Most people have heard the term Bitcoin, but they don’t know what it really is. Simply put, Bitcoin is a decentralized, peer-to-peer digital currency system designed to give online users the ability to process transactions through a digital exchange unit called Bitcoins. In other words, it is a virtual currency.
The Bitcoin system was created in 2009 by an unknown programmer. Since then, Bitcoin has gained a lot of attention, as well as controversy, as an alternative to the U.S. dollar, euro, and commodity currencies such as gold and silver.
A private network of connected computers is used to share transactions and process payments in Bitcoin. The creation of Bitcoins is based on increasingly complex mathematical algorithms and its purchase is made with national currency standards. Bitcoin users can enter their coins with their phones or smartphones.
As new and growing virtual currencies, Bitcoin has several advantages over conventional government flat currencies. Here are 5 benefits to using Bitcoin
1) No tax
When you shop for four dollars, a euro or any other government currency, you have to pay the government a certain amount of money as a tax. Each item that can be purchased has its own tax rate. However, when you make a purchase through Bitcoin, sales taxes are not added to your purchase. This is considered a legal form of tax fraud and is one of the main advantages of being a Bitcoin user.
With zero tax rate, Bitcoin can be useful especially when buying luxury items that are exclusive to a foreign territory. Such items are often taxed by the government.
2) Flexible Online Payments
Bitcoin is an online payment system and like any other system, Bitcoin users have the luxury of paying for their coins from anywhere in the world with an internet connection. This means that you can lie in your bed and buy a coin instead of buying a bank or a store.
In addition, online payment via Bitcoin does not require us to fill in the details of your personal information. Therefore, it is much easier for Bitcoin to process Bitcoin transactions than it does for US bank accounts and credit cards.
3) Minimum transaction fees
Fees and exchange costs are part of the wire transfer and international purchasing standards. Bitcoin is not controlled or moderated by any intermediary or government agency. Therefore, transaction costs are very low, unlike in international currency transactions.
In addition, Bitcoin transactions are unaware that they require time, as they do not involve any complication of typical authorization conditions and waiting periods.
4) Hidden User Identity
All Bitcoin transactions are discreet, or in other words Bitcoin allows you to anonymize Users. Bitcoins are similar to cash-only purchases, in the sense that your transactions cannot be tracked and these purchases are never linked to your personal identity. In fact, the Bitcoin address created for user purchases is never the same for two different transactions.
If you wish, you may voluntarily disclose and post your Bitcoin transactions, but in most cases users may keep their identity confidential.
5) No outside intervention
One of the biggest advantages of Bitcoin is that it eliminates third-party interruptions. This means that governments, banks, and other financial intermediaries have no authority to suspend user transactions or freeze a Bitcoin account. As mentioned earlier, Bitcoin is based on a peer to peer system. Therefore, users of Bitcoin have more freedom when shopping with Bitcoin than when they use the usual national currencies.
Digital currencies like Bitcoin are relatively new and have yet to be tested. As a result, many believe that there are certain risks in using Bitcoin. Despite the potential disadvantages of Bitcoin, it is clear that its merits are strong enough to become legitimate competitors in the not-too-distant future of conventional currencies.