Most people have heard of the term “bitcoin” but have no idea what it really is. Simply put, bitcoin is a decentralized digital currency system, peer-to-peer, designed to enable Internet users to process transactions through a digital exchange unit known as bitcoin. In other words, it is a virtual currency.
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The Bitcoin system was created in 2009 by an undisclosed programmer. Since then, bitcoin has attracted huge attention as well as controversy as an alternative to the US dollar, the euro and commodity currencies such as gold and silver.
A private network of computers connected by a common program is used to make transactions and process payments in bitcoins. The creation of bitcoins is based on increasingly complex mathematical algorithms, and its purchase is carried out with standard national monetary currencies. Bitcoin users can access their coins from their smartphones or computers.
As a new and growing virtual currency, bitcoin has certain obvious advantages over conventional government flat currencies. Here are 5 benefits that you will enjoy when using bitcoin
1) No taxation
If you make purchases in dollars, euros or any other government single currency, you must pay the government an additional amount as a tax. Each item that can be purchased has its own tax rate. However, when buying through bitcoin sales tax is not added. This is considered a legal form of tax evasion and is one of the main benefits of using bitcoins.
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A zero rate bitcoin tax may be required, especially when purchasing luxury items exclusive to overseas. Such products are most often taxed by the government.
2) Flexible online payments
Bitcoin is an online payment system, and like any other such system, Bitcoin users have the luxury of paying for their coins from anywhere in the world that has an internet connection. This means you could lie in bed and buy coins instead of suffering from a trip to a certain bank or store to do the work.
In addition, online payment via bitcoin does not require the entry of information about your personal information. Thus, processing bitcoins with bitcoin transactions is much simpler than committing through US bank accounts and credit cards.
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3) Minimum transaction fee
Exchange fees and costs are part of standard bank transfers and international purchases. Bitcoin is not controlled or moderated by any intermediary or government agency. Thus, transaction costs are kept at a very low level, unlike international transactions made through conventional currencies.
In addition to this, it is known that transactions in bitcoins do not take much time, as this is not due to the complications of typical authorization requirements and waiting periods.
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4) Hidden user identification
All transactions with bitcoins are discrete, in other words, bitcoin allows the anonymity of the user. Bitcoins are similar to cash purchases only in the sense that your transactions can never be tracked to you, and these purchases are never related to your identity. As a matter of fact, the Bitcoin address created for users’ purchases is never the same for two different transactions.
If you want, you have the ability to voluntarily disclose and publish your bitcoin transactions, but in most cases users keep their data secret.
5) No outside interference
One of the biggest benefits of bitcoin is that it eliminates outages with third parties. This means that governments, banks and other financial intermediaries do not have the power to disrupt user transactions or freeze a Bitcoin account. As mentioned earlier, bitcoin is based solely on an equal system. Thus, users of bitcoins enjoy more freedom when shopping with bitcoins than when using conventional national currencies.
Digital currencies, such as bitcoin, are relatively new and have not yet been severely tested. As a result, many feel that there are certain risks when using bitcoins. Regardless of the potential disadvantages of bitcoin, it is clear that its value is strong enough to make it a legitimate contender to challenge conventional currencies in the not-so-distant future.