In this article, we discuss Bitcoin in all details. We give answers to the most curious questions about Bitcoin. What is Bitcoin? What are its advantages and disadvantages? All the answers are here.
With the global economic crisis that started in 2008, the global financial system was hit hard. The trillion-dollar monetary expansion movement, which governments went to save a hundred-year-old giant institutions, and especially banks, affected households the most.
People have witnessed helplessly that the money in their pockets is melting day by day due to the irresponsibility of governments and banks. It is at this point that the wrong policies implemented by the governments have fueled the need for a decentralized currency.
As a reflection of the need arising from here, the person or persons hidden behind the name Satoshi Nakamoto (who Satoshi Nakamoto is still unknown) announced Bitcoin in 2008. In the first years of its introduction, Bitcoin was often associated with money laundering and terrorism financing. Because governments and banks did not even want to think of losing control of money, and still do not. At this point, Bitcoin has achieved this in its 13-year history and has managed to take control of the money from governments and banks and give it back to its owner, the household.
We use the phrase gave it back because until the 1970s the gold standard, that is, a sustainable monetary system where the value of money was based on gold was used. In 1973 this system was completely abandoned. This is how both the USA and the Euro zone started printing money for no money.
The abandonment of the gold standard lies behind the popularity of Bitcoin in a very short time. Trillions of dollars were injected into the financial system both due to the 2008 global crisis and the pandemic-induced liquidity crisis in 2020. But I can hear what you say is bad about this:
The financial system succumbed to inflation, with the money being printed free of charge by the governments as a monetary expansion. With the increase in the amount of dollars in circulation, the purchasing power of the dollar declined considerably.
In 2020, with the liquidity crisis we are facing due to the global pandemic, governments around the world, especially the USA, injected trillions of dollars into the system. At this point, fiat currencies, which can also be defined as traditional currencies, succumbed to inflation, and an alternative asset to gold was sought.
In such an environment, the star of Bitcoin started to shine. A decentralized currency with codes of when and how much to produce has become the savior of both households and institutions, as the dollar struggles with high inflation. For this reason, we witnessed that Bitcoin rose from 4 thousand dollars to 60 thousand dollars in 2020. With gold as a safe haven, Bitcoin has become the savior of millions who do not want to be crushed under currencies such as the dollar, euro, Turkish lira.
Without further ado, let’s take a closer look at what is Bitcoin.
What is Bitcoin?
Bitcoin was announced by Satoshi Nakamoto in 2008 and was made available in the early days of 2009. Satoshi Nakamoto announced this new currency he created with an article titled “Bitcoin: Peer-to-Peer Electronic Cash System”. This money, independent of decentralization, that is, the control of an institution, person or government, resistant to tertiary intervention, soon became the eye of the whole world.
The total number of Bitcoin that can be produced, that is, its supply is limited to 21 million BTC, and more than 80% of 21 million BTC has been produced so far. Due to the structure of Bitcoin determined by mathematical calculations and codes, the process of producing the remaining few million BTC is expected to take until 2140. As of the first quarter of 2021, approximately 18.6 million of the BTCs that can be produced in total are in circulation. The production process of the remaining 2.4 million BTCs will take approximately 120 years.
Bitcoin, which was introduced as the first successful crypto money, is also the “1. It is also called “Generation Blockchain”. Due to its distributed structure, Bitcoin, which provides solutions to the problems in today’s financial system, is also highly appreciated for its privacy.
Before continuing, let’s talk about what kind of privacy it provides to Bitcoin users. Transactions you make with Bitcoin take place between the addresses of wallets, which are a mixture of numbers and letters.
What is Altcoin?
After the first successful crypto currency Bitcoin, thousands of different cryptocurrencies were developed. According to the data obtained from the Coingecko site, there are more than 6,600 different cryptocurrencies currently active. Cryptocurrencies other than Bitcoin are expressed as altcoins by shortening the words alternative and coin.
Alternative cryptocurrencies are developed to provide solutions to many different problems. Many different crypto money projects that offer solutions in many different areas from education to health, from transportation to telecommunications are operating today.
What Advantages Does Bitcoin Provide?
The most widely used criticisms of Bitcoin today are about money laundering and terrorism financing. But what was money laundering before Bitcoin, which has a history of only 12 years? Nowadays, we witness that hundreds of years of giant institutions try to hit Bitcoin in this way, with billions of dollars in money laundering news coming up. The latest example of this is the 151-year-old German Deutsche Bank.
The reason why Bitcoin is criticized so much by global giants is not the concerns about money laundering and terrorist financing, but the advantages it provides. Bitcoin has many advantages that today’s traditional financial system cannot or does not want to provide.
To summarize, its inflation-resistant structure, its simplicity and security, its privacy and transparency are among the most important advantages of Bitcoin.
With Bitcoin, money transfers can be made much safer, faster and cheaper. Today, when sending 100 dollars with Western Union, we may have to pay a transaction fee of 20 dollars, but with Bitcoin, it is possible to transfer millions of dollars for a few cents.
However, you can access your Bitcoins from anywhere you want, you just need to know your private key. Bitcoin can be transferred very easily compared to gold or dollars. On the other hand, the money transfers you make cannot be controlled by governments or banks.
What are the Disadvantages of Bitcoin?
The fact that transactions made with Bitcoin cannot be traced can turn into a disadvantage in some cases. In illegal cases, Bitcoin can be used by criminals.
However, Bitcoin is still a new technology and you may not be able to use your Bitcoins to pay anywhere, anytime. However, it is considered certain that this problem will be solved with the widespread use of applications such as Bakkt and prepaid crypto money cards in the near future.
Who Controls Bitcoin?
Bitcoin works regardless of a person or institution. On the other hand, there are no assets where the price of Bitcoin is fixed. Bitcoin has been the best performing asset of the last 10 years as a mathematically generated currency that takes its value from limited supply. At this point, Bitcoin solves the problems needed in the traditional financial system: money struck for no money and the resulting high inflation. Bitcoin is managed in a distributed manner by miners who contribute to the network completely voluntarily. Miners are rewarded with BTC by the Bitcoin network as a result of these efforts. Thanks to Bitcoin miners around the world today, the Bitcoin network operates in a decentralized and distributed manner. As the number of miners contributing to the Bitcoin network increases, the network becomes even more secure.
The process of creating new Bitcoins is based on a mathematical system. In this way, the Bitcoin network, which is not under the control of any person or institution, can survive. The Bitcoin network is critical for Bitcoin to survive. Let’s take a closer look at the mining process in Bitcoin:
Bitcoin mining is based on deciphering cryptographic passwords. A new block is generated every 10 minutes and the first person to decrypt the cryptography password every 10 minutes is entitled to receive the block reward. In this way, new Bitcoins are produced, the security of the network is ensured and transactions on the network are recorded simultaneously by thousands or even millions of devices.
Bitcoin Price From Past to Present
When it comes to Bitcoin, Bitcoin price is one of the most curious ones. Before asking how much Bitcoin price is and how much is Bitcoin, let’s first look at the performance of BTC in the past years. Here are the highest levels Bitcoin recorded on a yearly basis in the 6-year period we left behind:
2016: $ 567
2017: $ 20,000
2018: $ 7,558
2019: $ 7,366
2020: $ 30,000
2021: $ 61,180
Bitcoin’s highest levels since 2009 are even more exciting. You can follow the biting performance of Bitcoin in the last 13 years on our Bitcoin how many TL page, and you can reach the prominent developments, comments and analysis about Bitcoin with a single click.
How to Buy Bitcoin?
Today, many methods can be preferred to buy Bitcoin. We will talk about them in this part of our article. Here are the methods you can choose to buy bitcoins:
- Buying BTC through cryptocurrency exchanges
- Buying BTC through peer-to-peer marketplaces (p2p)
- Buying BTC via crypto money ATMs
Among these 3 methods, the easiest and fastest is to buy Bitcoin through cryptocurrency exchanges. You can choose the crypto currency exchange that best suits your preferences and buy Bitcoin within minutes. Here’s what you need to do for this:
- Being a member of the stock exchange
- Verifying your account
- Adding money to your account
- Performing the purchase
And now you are a Bitcoin investor!