If anybody had mentioned Bitcoin back in 2007, it wouldn't have meant anything to most people. However, Satoshi Nakamoto had it in mind. And even when this mysterious entity introduced this cryptocurrency to the world, most people didn't care much about it.

Fast forward, Bitcoin is a major digital asset or virtual currency ten years later. Many business and financial websites and magazines feature articles about Bitcoin prominently. Platforms like the BitIQ Trading System are receiving more signups by the day. Ideally, more people are now aware of Bitcoin than a decade ago.

But do you need Bitcoin? Why should you care about this virtual currency? Maybe these are the questions lingering in your mind as you read this article.

Understanding Bitcoin

Bitcoin is essentially a virtual currency and an asset. It's a blockchain-based currency that is entirely decentralized, meaning no central bank, monetary authority, or government regulates it. Instead, a peer-to-peer community of networked computers maintains this digital currency. Perhaps, the Bitcoin network compares to BitTorrent.

Since Bitcoin uses the blockchain, it's a digital database that creates a public, distributed ledger with all Bitcoin transactions. Also, this network uses cryptography for security purposes. A process called Bitcoin mining allows computers or nodes to confirm transactions digitally.

Bitcoin mining entails entering transaction details into the blockchain after checking them mathematically using a complex digital code system on the network. The Bitcoin blockchain network confirms and verifies the new entries into the public ledger.

Despite being fundamentally anonymous, the mathematical verification process makes it a public, global transaction ledger. Thus, members of the Bitcoin network can trace every Bitcoin transaction.

Do You Need Bitcoin?

Most people don't understand the benefits of this cryptocurrency yet. Like in the past, some people didn't see the essence of having an email address. Today, almost everybody with a smartphone or computer has an email address. Most people use email addresses to communicate and do business.

Bitcoin is the first successful virtual currency running on blockchain technology. Since its introduction, this digital currency has increased exponentially in value. While its price fluctuates rapidly, it has kept growing since its introduction. For this reason, many people see Bitcoin as an investment.

If a person bought Bitcoins worth $100 in 2010, they could recoup more than that amount if they sell their holdings today. Perhaps, the stories of Bitcoin millionaires worldwide encourage many people to purchase and hold Bitcoins as an investment.

Also, many online and local stores now take Bitcoin payments. That means this cryptocurrency might eventually compete with fiat currencies. Additionally, Bitcoin doesn't link to any central authority. No single government, political, or financial situation of a specific country can affect Bitcoin's price. Additionally, governments can't manipulate Bitcoin's value via their central banks.

Consequently, Bitcoin can't suffer the problems of fiat currencies, such as inflation. Additionally, this digital currency has a limited supply of the total number of tokens that the world can ever have. And as miners generate more tokens, their value continues to rise as they draw near the limit. Therefore, people who buy Bitcoins today might sell them at a higher price once the miners generate all the 21 million tokens.

Parting Shot

Most investors have bonds, cash, gold, and equities in their portfolios. However, Bitcoin is a new asset class that any investor should consider adding to their portfolio. If you don't buy or care about Bitcoin, the world won't end. However, you could end up regretting it if you ignore Bitcoin and its price increases, enabling people that invest in it today to reap significant future returns. Therefore, consider investing even a small amount of money in this virtual currency and wait for its future to unfold.

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