Whether you’re dialed into the financial world or not, chances are you’ve heard about Bitcoin some in the last few years. Lately, there has been a lot of talk about the cons of crypto in the media as of late, but what about all the advantages of Bitcoin we may be missing out on?
Since its launch in 2009, this cryptocurrency has rocked the fintech world, even being hailed as the greatest innovation since the internet itself. But what is Bitcoin, and should you try to get your hands on some?
There are a number of advantages of Bitcoin as a currency, ranging from financial independence to low transaction fees. Read on to learn more about this cryptocurrency and why you should consider buying in.
What Is Bitcoin?
Before we dive into all the benefits of Bitcoin, let’s talk some about what it actually is.
Bitcoin is a sort of independent currency that provides an alternative to government-issued currencies. It works on a peer-to-peer basis and is handled through a blockchain system that serves as a kind of open-source ledger.
Traditionally, a country would be responsible for issuing and managing currency and would be in charge of determining and guaranteeing its value. But Bitcoin operates outside of any government entity or banking system. (Yeah, even China)
It takes its value from the fact that there are a limited number of Bitcoins – 21 million, to be precise – and it’s protected by a series of ever-more complex algorithms.
Although Bitcoin is a cryptocurrency, it does carry real monetary value in the world. You can use Bitcoin to purchase a variety of products, including from reputable vendors like Overstock or Expedia. You can also use it to pay back debts or pay people for services rendered if they agree.
How It Works
One of the main problems that arose when people were trying to figure out how to create the first cryptocurrencies was security.
After all, how do you stop someone from simply creating more Bitcoins and adding them to their account if the currency is all code-based anyway? The currency would become worthless since anyone could claim to own however much of it they wanted.
But Bitcoin uses a series of incredibly complex computer algorithms to secure its currency. There were only 21 million Bitcoins created when the currency got its start, and there will only ever be 21 million Bitcoins (though there are smaller divisions of the currency, just like with traditional currencies).
The cryptocurrency’s source code is all but impossible to break, so no one can manipulate how many Bitcoins they have.
Now, let’s look at the advantages of Bitcoin.
1. User Autonomy
Proponents of Bitcoin love the opportunities it provides for user autonomy. When you deal with fiat currencies, which are regulated by governments and banks, you have to work within an established system of rules.
You have to get permission from a bank to open an account or get cash, which the government has to give you permission to legally use.
Bitcoin, however, is self-regulated and is independent of any of these third-party structures. You can get much more direct control over your money without having to work in standard financial institutions. For people worried about the impact political changes could have on their money, this sort of autonomy is a big draw.
Another one of the major advantages of Bitcoin is that it’s relatively discreet as currencies go.
With fiat currencies, you have a clear paper trail of where your money comes from and, in many cases, how it gets spent. This trail is tied to your identity and often to an identifying financial number, such as a social security number.
But when you operate in Bitcoin, there’s no reason your purchases need to be tied directly to your personal identity. You can trade anonymously online without there being any concern about your money being fake or fraudulent.
In an age where more and more of our lives are under a microscope, this sort of anonymity appeals to many Bitcoin users.
3. Peer-to-Peer Framework
Once we grow up, we have this idea that we’re supposed to be able to make our own decisions and live life on our own terms. And while that’s true to a degree, there are still a number of traditional powers that have control over our lives.
If you plan to buy a house, for instance, you must ask the bank permission to give you money to buy the house, and the bank must ask the government to provide them with the funds to give you that money.
Bitcoin is set up on a peer-to-peer basis that gives its users more control over their actions. You and another person can agree to exchange a good or service for a certain amount of Bitcoin completely aside from any government or banking entities.
You don’t have to ask anyone to give you your money, and no governments have to reach trade agreements before you get that legendary Pokemon card you bought.
4. No Banking Fees
Banking fees are a source of great frustration for many adults, and for good reason. You have to pay a bank for the privilege of letting them keep your money and use it as they see fit.
Then, if you break any of their dozens of arbitrary rules, you have to pay them more money, some of which can actually send you into debt.
Because Bitcoin operates outside of the traditional realm of banking, you’ll never have to worry about banking fees. You can handle your money directly, and if you don’t have enough Bitcoin to cover a transaction, that’s between you and the seller.
You’ll never have to pay a fee to keep an account open or worry about having to pay to keep your money in an institution.
5. Low International Transaction Fees
These days, the world is smaller than ever, and many of us conduct overseas business every day. You may be buying from an Etsy vendor in another country, or you might be sending money to family back in your home country.
In traditional banking setups, these international transaction fees can start to stack up and take money out of your pocket.
Bitcoin, however, operates independently of any one nation, meaning you don’t have to pay as much in transaction fees. It doesn’t matter who your country is friends with today or what trade agreements have been renegotiated. International transaction fees stay low and you keep more of your hard-earned money in your pocket.
6. Greater Payment Mobility
One of the amazing things the internet has done for our society is making it possible for us to handle our money from anywhere. No longer do you have to write a check and drop it off at your utility department each month to cover the cost of your electricity and water.
In fact, if you want to, you can pay your bills each month lying in bed, or on the subway, or while you get a pedicure at your local spa.
Bitcoin takes that ability to access your money from anywhere to the next level. Because the entire currency is internet-based, it’s much better adapted to being mobile-friendly. You can handle your Bitcoin from your phone, and you can even use Bitcoin ATMs for any cash transactions you may need to make.
7. Better Accessibility
Bitcoin has also been a fantastic boon to people living with various sorts of disabilities. Getting to a traditional bank to handle major transactions can be tremendously difficult for disabled people.
You may have to arrange for transportation and then deal with accessibility issues at the bank itself, including handling interpreters or coping with the challenges of a mental illness.
When you use Bitcoin, you can bypass many of those issues and access your money in a way that works for you. Because you aren’t working through a bank, you don’t have to worry about finding a branch near you and dealing with any accessibility barriers they may have.
You can handle your money from the comfort of your own home, where you have all the accommodations you need.
8. Immune to Seizure
When you’re dealing in fiat currencies, one of the concerns you may have is that your money could get seized. If you own a business and you lose a liability case, your personal assets could be up for grabs in a settlement agreement.
Likewise, if you get behind on required payments, such as alimony or child support, the government could seize your money and leave you destitute.
But while fiat currencies are susceptible to this kind of seizure, that’s not something you have to worry about with Bitcoin.
Because it doesn’t belong to any bank or government, it’s not subject to the same sorts of seizure laws as other currencies. You own it free and clear on your own terms, and no one can take it away from you.
9. No Inflation
One of the other constant worries with fiat currencies is the risk of inflation.
Printing more money may seem like an easy solution to not having enough money, but in fact, it just devalues the currency. The more money there is, the less each unit is worth, and so the more money it takes to buy the same items.
Bitcoin is immune to inflation because of its tightly controlled source code. No one can manufacture more bitcoin except the creator, and they refuse to do so to avoid the risk of inflation.
There have only ever been 21 million Bitcoins, there will only ever be 21 million Bitcoins, and any other value fluctuations will come from changes in other forms of currency.
10. Easy to Use
Some people may think that Bitcoin is a difficult or mysterious system to get into, but nothing could be further from the truth.
Bitcoin is a simple system: you trade traditional currency for Bitcoins in the same way you would exchange one country’s currency for another. You can also get Bitcoins from a transaction and then spend them when and how you please.
With the rise of conveniences like Bitcoin ATMs, you can even purchase Bitcoins while you’re out running errands. There are dozens of these ATMs located across the country, and we’ll see more soon.
They can even allow you to get access to your Bitcoins faster than online purchases thanks to improved identification options.
One of the biggest issues many people have with fiat currencies is their lack of transparency.
While we may see the results of operations happening behind the scenes, we lowly citizens don’t always know what machinations are impacting our money. Governments don’t have to release that information, and many prefer to keep their citizens in the dark.
Bitcoin, on the other hand, is a completely transparent system. Because it operates online on an open-source platform, anyone can access the blockchain that stores Bitcoin transactions.
Everyone can see what’s happening with the Bitcoin supply and transactions, even if they can’t see personal information about people using the currency.
12. Open Source
Although the Bitcoin source code is locked down to prevent people from manufacturing more Bitcoin, the software surrounding it is open source.
Even the blockchain that controls Bitcoin interactions is open to anyone who knows how to access it. This truly makes Bitcoin a currency of the people in some unique ways.
Anyone who wants to can submit their own contributions to the Bitcoin world. One of the most popular options for this is developing and launching Bitcoin software clients. This sort of open system fosters innovation and creative solutions that you don’t get in the closed systems of fiat currencies.
Discover the Advantages of Bitcoin
Although cryptocurrencies have exploded onto the financial scene in the last few years, Bitcoin remains the oldest and most popular option. There are a number of advantages to working with Bitcoin, from the financial freedom you get to the ease and accessibility of use.
Bitcoin is completely transparent and is independent of any third-party government or financial institution that regulates other forms of money. (You heard that, China?)
If you’d like to discover the advantages of Bitcoin for yourself, check out the rest of our site at Byte Federal. We have the financial tools you need to bank yourself and thrive in the financial world.
Learn more about us today and start getting faster access to your Bitcoin the easy way.