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Everything You Need To Know About Bitcoin

BitcoinBitcoin is about to have a big year. The crypto-currency, used for making online peer-to-peer transactions has soared in popularity since it's creation in 2009, yet it's taken it awhile to break into the mainstream. However, after the first day of trading for 2017, Bitcoin's share value exceeded $1,000. This means the worth of the currency has risen 125% in the past year alone. This all sounds great if you're a trader or heavily invested in bitcoin, but what does it mean for the average mobile casino player? Should you expect to see it as a payment service in more casinos? Should you invest in it? We're here to tell you everything you need to know about bitcoin, from how it works to whether it's really worth your time.

What Is Bitcoin?

Bitcoin was created in 2008, and launched to the public in 2009, by a programmer (or group of programmers) using the fake name Satoshi Nakamoto. The true creator of the currency remains a mystery; several people have since claimed to be the programmer, yet none have been able to conclusively prove it. Bitcoin was designed to be a decentralized currency, meaning there's no government, bank or company in charge, and was intended to eliminate the middle-man from online transactions. This means that payments are sent peer-to-peer, from the payee to the recipient, with no need for an outside service, no transaction fees and no need to exchange any personal information.

Bitcoin MiningBitcoins are created through a process called ‘mining'. Mining uses a mathematical formula to produce bitcoins and, as the software is freely available, you can mine bitcoins from your own computer. However, bitcoin is not unlimited. The ‘bitcoin protocol' dictates that a maximum of 21 million bitcoins can be created, to prevent inflation. At the current rate of production, this amount will be in circulation by 2140.

To spend bitcoins you need to create a bitcoin ‘wallet', which stores the information needed to complete transactions. Every single bitcoin transaction is registered on a huge online ledger, known as the blockchain. This shows the time and amount of each transaction, but will not show any personal information. When you have a bitcoin wallet, the bitcoins remain part of the blockchain, but the wallet allows you to see and spend your own bitcoins.


The Pros Of Bitcoin

Bitcoin has several important characteristics and features that set it apart from normal currencies and therefore, arguably more appealing.

  • It's Decentralized
    The bitcoin network isn't controlled by one central authority, like a bank, company or government. Instead, it's created as a community, with every machine that mines bitcoin making up part of the network. This means that there's no authority to mess with policy or cause meltdown. For instance, in regular currency, a goverment may decide to print more cash to cover a debt. This leads to inflation, and economic crisis. Similarly, it also means that a central authority can't decide to take money away from people.
  • bitcoin transactionIt's Easy to Set Up
    If you've ever tried to set up a bank account, you'll know how many trips to the bank, emails, and phone calls it takes. Similarly, if you're using an e-wallet like PayPal, you'll also be aware of the hoops you need to jump through to get it working properly. In contrast, you can set up a bitcoin address in seconds, no questions asked and without any fees.
  • It's Anonymous and Transparent
    To set up a bitcoin address you don't need to supply any personal information. This means that when you make a payment, the recipient cannot see your name, address or any other information that may identify you. However, one of bitcoin's biggest characteristics is that it's transparent. Ever single transaction ever to happen is stored in the blockchain, which is free for the public to access. This is great for monitoring how bitcoin evolves but, whilst it won't show anyone your personal details, it can show how many bitcoins are stored in your bitcoin address.
  • It's Fast and Free
    Bitcoin doesn't charge transaction fees, as you're essentially just sending money from you to another person. This is great for overseas payments. Similarly, when you send money via bitcoin it will arrive minutes later, as soon as the bitcoin network process the payment. Unlike regular transactions, it doesn't take longer to send money abroad.


The Cons Of Bitcoin

Every currency and payment method has its own disadvantages. As bitcoin is relatively new, it's important to understand its flaws before investing.

  • Bitcoin Is Volatile
    Unlike traditional currencies, which stay fairly stable in value, bitcoin can be highly volatile. From one day to the next the value of your bitcoin can plunge and soar. This is one of the biggest disadvantages, as you can never be sure of its worth.
  • It's Not Yet Universally Accepted
    More and more retailers are accepting bitcoin, however it will be quite a while until the currency is universally accepted. People have claimed to ‘live off' bitcoin, yet for the average person it's not practical to rely completely on bitcoin as their only form of currency — you can't buy a pint of milk at your local corner shop with it.
  • Bitcoin ThiefBitcoins Can Be Lost
    Bitcoin wallets can be lost, just like regular wallets containing cash. This should be no riskier than loosing your actual wallet, however hacking and viruses can make bitcoin susceptible to being stolen. Furthermore, if you forget your passcode to your bitcoin wallet, the balance may be lost forever. There are safeguards to protect against most losses, and security for the currency is constantly being updated, however loosing bitcoins is still a real risk.


Bitcoin In 2017

2017 will be a huge year for bitcoin, and telling in what it's worth and if it's a viable investment. The biggest bitcoin markets, like China, the US and Europe are responsible for it's dramatic rise in both popularity and value. External factors, like the US elections, have contributed to bitcoin's increase in value. Users see bitcoin as a new gold, a safe financial investment that, as it's decentralized, isn't affected by politics and fear and will continue to grow.

Experts say that Bitcoin could reach a share value of $2,000 by the end of 2017, which would be an incredible increase. This would also mean that more investors would buy into the currency, upping it's value even more, and forcing retailers to take the currency more seriously and help it to become more universally accepted.

iGaming is a market that has been instrumental in the growth of Bitcoin and, in 2017, there's now a record amount of Bitcoin casinos and Bitcoin sportsbooks out there. Whether you decide to invest in the virtual currency is up to you, but it's definitely worth keeping an eye on this year.

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