The bitcoin system has several advantages as well as disadvantages, often within the same property. First of all, it is completely anonymous and transparent at the same time. Anyone interested in joining the system will create a bitcoin wallet with a unique code, then they can buy bitcoins or pay with it.
The problem arises with who pays with bitcoin. After a new interesting tool, the black market also caught on the bitcoin or almost everyone who could not report their activities publicly. Bitcoin thus contributed to the development of the so-called darknet, which we could simply describe as the underworld of the Internet. In addition to direct payments for illegal goods, bitcoin began to develop rapidly as a tool for collecting ransom in computer attacks, tax evasion, and there is speculation that it was used by some states that were in international isolation.
A separate problem is the loss of wallets and codes to them. There have been cases where some people bought bitcoin at the beginning of its development and forgot about it. After a few years, they found that their investment (often small) had grown to incredible values. At the same time, however, they threw away a flash drive or HDD on which they stored their bitcoins.
The situation that occurred in 2019, when a Canadian businessman who managed cryptocurrencies for his customers died, was specific. But no one but him knew the password to a database in which these cryptocurrencies were stored so that hackers could not access them, and after his sudden and unexpected death, the bank had to declare bankruptcy, owing to its creditors more than $ 240 million. In addition, this number would now be much higher due to rising prices for bitcoin and cryptocurrencies.
The value of bitcoin is based on trust. The trust of those who pay with them, and a certain awareness of the value of one particular unit. Most currencies are tied to the economies of countries that consider it their own, and their price fluctuates accordingly. In addition to the growth or decline of the economy, there are also factors such as inflation (decline in value) or deflation (increase in value). Currencies are affected by regulatory authorities, as is national policy.
Bitcoin is inherently exempt from most of the above factors, although sometimes not completely. The value of bitcoin is determined by the stock exchange - when there is great interest in it, its price rises, on the contrary, when interest decreases and people start selling it, the price falls proportionally, there is the law of supply and demand in the purest sense. The advantage is the above feature, according to which the market has an idea of how many bitcoins will be added to the system.
The bitcoin itself and its system are not affected, but the opinion of it, which is crucial, is. During its development, this currency has experienced several ups and downs. Most of them were caused by positive external influences, such as the announcement of the acceptance of bitcoin by banking services or the arrival of a major brand. On the other hand, price falls arranged negative impulses such as the regulation of cryptocurrencies by state authorities, a negative expression of an important personality or a connection with a case. There are also opinions that the price of bitcoin is sometimes manipulated by some important personalities.
Bitcoin is the first cryptocurrency to be successful, but it is not the only one. Based on it, other cryptocurrencies arose, which more or less different. None of them is as successful as bitcoin, but the interest in them, and therefore their prices, significantly affects.
Litecoin was the first to appear after the start of bitcoin. It was launched as an alternative system on October 7, 2011. Like bitcoin, litecoin by Charles Lee is completely decentralized. Thanks to this, no one can influence him or cheat him effectively within his system. This cryptocurrency was the first to use the scrypt algorithm. There are 84 million Litecoins, four times more than bitcoins. The advantage of litecoin is less expensive administration - especially transaction fees. Litecoin has never achieved such courses as bitcoin. Its maximum was less than $ 400 per unit.
Another significant currency is Ethereum, respectively ether. Ethereum is the name of the whole system, which uses the currency ether. The inspiration for the creation of this currency as bitcoin, but its author wanted to use the possibilities of blockchain to run a decentralized virtual machine based on it, which would therefore have a huge computing power that could be rented for ethers. The system is thus even more complicated than in the case of bitcoin. The Etherea superstructure evokes conflicting feelings. Voices for say that it is good to have a system that uses the possibilities of blockchain for something other than just ordinary payments. On the contrary, many votes against say that the currency is much more unstable and prone to possible fraud.
Another cryptocurrency commonly encountered is bitcoin cash. It was created in 2017 not as a new currency, but as a spin-off from bitcoin as such. The group of miners came up with their own simpler system, which was to speed up work with bitcoins. The separation of bitcoin cash from the original bitcoin was at the beginning of the first significant rise in bitcoin prices. Bitcoin cash, like other cryptocurrencies, copies the course of bitcoin prices to a lesser extent.
In addition to the above-mentioned cryptocurrencies, some projects appeared that toyed with the idea of cryptocurrencies, but never succeeded in implementing it. Even some states or fast food chains have considered releasing their cryptocurrency. But it has always been a misuse of the marketing-strong word cryptocurrency for political or commercial purposes. What is your opinion on cryptocurrencies? Yüce Software would like to hear your opinions, which you can write to the commentary.