Please reach us at if you cannot find an answer to your question.
Bitcoin is a global consensus network that creates a new payment system and fully digital money. This is the first decentralized p2p payment network that is served by its own users, without central governments or intermediaries. From the point of view of users, Bitcoin is very similar to cash for the Internet. Bitcoin can also be considered as a leading accounting system with a triple entry.
Wrapped Bitcoin (WBTC) is a wrapped form of Bitcoin developed to give Bitcoin holders the ability to participate in popular decentralized finance (DeFi) protocols that were popularized by on and by the Ethereum network. WBTC is an ERC-20 token and therefore, gives Ethereum the advantage of inviting liquidity from the Bitcoin ecosystem onto the Ethereum network.
In order to create WBTC tokens, BTC holders submit requests to obtain newly issued tokens from a merchant who performs KYC and AML (Know Your Customer and Anti-Money Laundering) checks. The merchant then initiates the required transaction with an official custodian in order to mint the WBTC tokens before sending them into the custody of the merchant.
At this point, the requesting customer is able to swap BTC for WBTC with the merchant via a centralized exchange (CEX), decentralized exchange (DEX), or atomic swap. It is important to note that only merchants are empowered to redeem WBTC for BTC tokens in this protected process.
Due to the purpose of Wrapped Bitcoin and its unique minting process, there is a low circulating supply of WBTC. This is always the same as the total maximum supply, since it grows only as new tokens are minted. Currently, 210,1450 WBTC tokens are in active circulation. Live WBTC price can be viewed on Binance at any time.
What Is Wrapped Bitcoin (WBTC) Used For?
Wrapped Bitcoin is primarily used as an intermediary token for Bitcoin holders to enter the Ethereum network for the main purpose of interacting in DeFi applications in the ERC-20 ecosystem. Since Ethereum was designed several years after Bitcoin with decentralized application (DApp) technology, smart contracts and other protocols that enable further innovations beyond the BTC environment, Wrapped Bitcoin benefits both networks.
Bitcoin is the first implementation of the concept of "cryptocurrency", which was first described in 1998 by Wei Dai. In cyberpunk e-mail mailing, he proposed the idea of a new form of money that uses cryptography instead of a central control to control emissions and transactions. The first Bitcoin specification and proof of the operation of this principle was published by Satoshi Nakamoto in 2009 in a cryptographic e-mail newsletter. Satoshi left the project at the end of 2010 without revealing details about his identity. The community has grown exponentially since then, and now many developers are working on Bitcoin.
Satoshi's anonymity often raises unfounded doubts, most of which are related to a misunderstanding of the nature of Bitcoin's open source. The Bitcoin protocol and software are publicly available, and any developer from anywhere in the world can read the text of the program or make their own modified version of Bitcoin software. Like current developers, Satoshi's influence was limited only to those code changes that other users accept, and accordingly it is wrong to say that he controls Bitcoin. In fact, the personality of the inventor of Bitcoin does not matter today as well as the personality of the ancient inventor of paper.
No one owns the Bitcoin network, just as no one owns the technology behind e-mail. Bitcoin is controlled by bitcoin users around the world. Although developers are improving the software, they cannot force the protocol because users are free to choose which software and which version to use. In order to maintain compatibility, all users must use software that complies with the same rules. Bitcoin can only work correctly with full agreement between all users. Therefore, all users and developers have an incentive to protect this consensus.
From the point of view of users, Bitcoin is just a mobile application or computer program that gives them access to a bitcoin wallet and allows them to receive and spend bitcoins. That's how Bitcoin works for most users.
The Bitcoin network is based on a public register called blockchain, or a "chain of blocks." This register contains a history of all transactions ever made, allowing users' computers to verify the legality of each transaction. The authenticity of each transaction is protected by electronic signatures corresponding to the addresses used in the transaction, which allows users to have full control over the forwarding of bitcoins from their bitcoin addresses. In addition, anyone can process transactions using the computer power of specialized equipment and earn bitcoins for these services. This is usually called "mining." To learn more about Bitcoin, you can refer to this page or the original document.
Yes. More and more companies and individuals are using Bitcoin. Including both offline companies such as restaurants, hotels, law firms, and online services such as Namecheap, Overstock.com and Reddit. So far, Bitcoin remains a relatively new phenomenon, but it is growing rapidly. By the end of August 2017, the value of all bitcoins in circulation exceeded US$ 20 billion, and the daily turnover of bitcoin transactions is estimated at millions of dollars.
While there are people who sell bitcoins in exchange for payment by credit card or PayPal, most exchangers do not allow replenishment of funds through these instruments. This is due to the fact that people who bought bitcoins through PayPal then very often refuse to pay. This usually happens as a refund.
Bitcoin payments are easier than plastic card payments, and this does not require opening a current account. Payments are made through the wallet program installed on your computer or smartphone by simply entering the recipient's address, payment amount, and clicking the "send" button. To make it easier to enter the recipient's address, many wallets can read the address as a QR code or using NFC technology.
A significant part of the trust in Bitcoin stems from the fact that it does not require any trust. Bitcoin's source code is fully open and the network is completely decentralized. This means that anyone has access to the full source code at any time. Therefore, any developer in the world can check exactly how Bitcoin works. Anyone can track all bitcoin transactions and newly released bitcoins in real time. All payments are made without relying on a third-party organization and the entire system is protected by reliable and well-tested cryptographic algorithms similar to those used in online banking. No organization or individual can control Bitcoin, and the network remains secure, even if not all its users can be trusted.
You shouldn't expect to get rich with Bitcoin or any other new technologies. It is always important to be alert when something sounds too good to be true or contradicts basic economic principles.
Bitcoin is a growing ecosystem of innovation, as well as business opportunities that nevertheless entail risks. There is no guarantee that Bitcoin will continue to grow, even if it has so far developed very rapidly. Investing time and resources in something related to Bitcoin requires entrepreneurship. There are different ways to make money on Bitcoin, such as mining, speculation or starting new business projects. All these methods are highly competitive and without a guarantee of income generation. The correct assessment of the costs and risks accompanying such projects lies entirely with the entrepreneur.
Bitcoin is as virtual as credit cards and online banking networks that people use every day. Bitcoins can be used for online payments and in real stores, as well as any other type of money. Bitcoins can also be exchanged for physical equivalents, such as Casascius coins, but usually payment by mobile phone is more convenient. Bitcoin balances are stored in a huge distributed network, and they cannot be fraudulently changed by anyone. In other words, Bitcoin users have exclusive control over their funds and bitcoins cannot disappear just because they are virtual.
Bitcoin is designed to allow all users to send payments, with a sufficient level of confidentiality comparable to other forms of payment. However, Bitcoin is not anonymous and cannot offer the same level of confidentiality as cash payments. The use of Bitcoin leaves a public record. There are various mechanisms to ensure user privacy, and even more is under development. However, much work remains to be done to ensure that these functions can be used correctly by users.
Some doubts were expressed that the confidentiality of bitcoin transactions could be used for illegal purposes. However, it should be noted that Bitcoin undoubtedly falls under regulation that already takes place in existing financial systems. Bitcoin cannot be more anonymous than cash and is unlikely to prevent criminal investigations. In addition, Bitcoin prevents a wide range of financial crimes.
When a user loses his wallet, the funds contained therein are out of circulation. Lost bitcoins still remain in the block chain, as well as all other bitcoins. However, lost bitcoins will forever be left without movement, because there is no way to pick up a private key(s) that would allow them to be spent. According to the law of supply and demand, the fewer bitcoins are available, the more those that remain in circulation will be valued, and accordingly, it can be expected that all other bitcoins will add a little in value.
The Bitcoin network can perform much more operations per second than it actually does today. However, we should not expect that it is already ready to scale to the level of the main card systems. Steps to eliminate existing restrictions have already been outlined, and work is underway in this direction. Since its launch, every aspect of the network has been in a process of continuous improvement, optimization and specialization - it should be expected that this process will take at least a few more years. As network speed increases, Bitcoin users can increasingly use lightweight client programs, and full-fledged network nodes can become a more specialized service. For more information, see the Scalability Wiki page.
As far as we know, Bitcoin is not illegal in terms of current legislation in most jurisdictions. Nevertheless, some jurisdictions (for example, Argentina and Russia) have imposed strict restrictions or prohibitions on the use of foreign currencies. Other jurisdictions (e.g. Thailand) may require the licensing of certain entities, such as bitcoin exchangers.
Regulators of different jurisdictions are taking steps to create rules for individuals and legal entities aimed at integrating this new technology into the existing financial system. For example, the American Financial Crimes Network (FinCEN), a division of the U.S. Department of the Treasury, has issued a non-binding guide on how it characterizes some activities that include virtual currencies.
Bitcoin is money, and money has always been used for both legitimate and illegal purposes. Cash, credit cards, and the modern banking system are far superior to Bitcoin in terms of their use to finance crimes. Bitcoin can bring significant innovations to payment systems and the benefits of these innovations are usually considered to be much overlapping their potential disadvantages.
Bitcoin is designed in such a way that it is a serious step forward in terms of security. It can also be used as a significant protection against many forms of financial crimes. For example, bitcoins are absolutely impossible to fake. Users have full control over their payments and cannot accept unconfirmed accounts, such as credit card fraud. Bitcoin transactions are irreversible and are not at risk of fraudulent refunds. Bitcoin allows you to protect money from theft and loss with powerful and useful mechanisms such as backup saving, encryption, and multiple signatures.
There are some concerns that Bitcoin may be more attractive to crime because it is characterized by confidential and irreversible translations. However, similar characteristics already exist in cash and telegraphic transfers, which are used more widely and everywhere. The use of Bitcoin will undoubtedly be subject to the same regulation that already exists in current financial systems, and Bitcoin is unlikely to prevent criminal investigations. In general, it is common for revolutionary ideas to an area to be perceived as something controversial before its advantages become well understood by everyone. A good example, among the many others that illustrate this is the formation of the Internet.
The Bitcoin Protocol itself cannot be changed without the consent of almost all its users, who decide which software to use. Attempts to assign special privileges to any local authorities, under the global nature of Bitcoin, are in practice unrealistic. Of course, a rich organization can invest in mining equipment to gain control over half of the computer power of the network, which will allow it to block or roll back recent transactions. However, there is no guarantee that they will be able to achieve or maintain this position, because it will require constantly investing as much as all the other miners in the world combined.
However, it is quite possible to regulate the use of bitcoins, like other financial instruments. Like the dollar, Bitcoin can be used for a wide range of purposes that can be recognized as legitimate or not, depending on the laws of each particular country. In this regard, Bitcoin is no different from other tools or resources and can be regulated differently in different countries. It can be made that the use of Bitcoin will become difficult, with the help of rules and restrictions, and in this case it is difficult to predict what percentage of users will continue to use this technology. The government that has decided to ban Bitcoin will prevent its domestic market and entrepreneurs from developing, which will lead to the flow of innovation to other countries. The challenge for regulators, as always, is to develop effective solutions without weakening the growth of newly emerging companies and markets.
Bitcoins are not fiat money, they are not mandatory in any jurisdiction. However, taxes are often accrued regardless of the means of payment used. There are a wide range of laws, in a large number of different jurisdictions, that can become the basis for tax liabilities regarding income, sales, wages, capital gains, and some other forms of taxes when using Bitcoin.
Bitcoin gives people the freedom to make transactions on their own terms. Each user can send or receive payments, as well as for cash, but can also participate in more complex contracts. Multiple signatures allow transactions to be accepted by the network only if a specific number of certain people agree to sign it. This makes it possible to develop an innovative dispute resolution service in the future. This service will be able to allow a third-party organization to accept or reject a transaction, in case of disagreement between the parties, without gaining control over their money. In contrast to cash and other payment methods, Bitcoin always leaves publicly available evidence that the transaction has taken place, which can potentially be used as a solution against companies with fraudulent activities.
It is also worth noting that while companies usually depend on their reputation to stay in business and pay their employees, they do not have access to the same level of awareness when they deal with new consumers. The way Bitcoin works allows both parties, both the buyer and the seller, to be insured against fraudulent refunds, while at the same time giving buyers the choice of choosing greater protection when they do not trust a particular seller.
New bitcoins are created in a competitive and decentralized process called mining. This process implies that people receive remuneration from the network for their services. The one who is engaged in mining actually processes transactions and ensures network security using specialized equipment, and for this he receives new bitcoins.
The Bitcoin protocol is designed in such a way that new bitcoins are created at a fixed speed. This makes bitcoin mining a very competitive business. When more miners join the network, it becomes more and more difficult to make a profit and miners should look for ways to reduce their operating costs. No central authority or developer has any power to, control or manipulate the system to increase its income. Every bitcoin node in the world will reject any transaction that does not follow the rules that the whole system follows.
Bitcoins are created at an increasingly decreasing and predictable rate. The number of new bitcoins created each year automatically halve until production stops completely, and the total number of bitcoins produced is not equal to 21 million bitcoins. From now on, bitcoin miners will probably be supported exclusively by the flow of small transaction fees.
Bitcoins have value because they are useful as a form of money. Bitcoins have all the characteristics of money (durability, portability, interchangeability, deficit, divisibility and recognition). These properties are based on mathematics, not on physical properties (as in gold or silver) or on trust in the central body (as in fiat currencies). In short, Bitcoin relies on mathematics. Given this, all that is required for bitcoins to maintain their value is trust and prevalence. For Bitcoin, this can be measured by a growing database of users, entrepreneurs, and startups. As with all other currencies, the value of bitcoins is determined only by people who are ready to accept them as payment.
The price of bitcoins is determined by supply and demand. When the demand for bitcoins increases, the price also increases, and when demand falls, the price also falls. There are a limited number of bitcoins in circulation, and new bitcoins are created at a predictable and ever-decreasing rate, which means that demand must follow this level of inflation in order for the price to be stable. Since Bitcoin is still a relatively small market, compared to what it can become, it does not take significant amounts of money to move the price in the market up or down, and therefore the price of bitcoins is still very volatile.
History of the Bitcoin rate:
Yes. History is full of examples of currencies that were unsuccessful and are no longer used, such as the German Mark during the Weimar Republic and, most recently, the Zimbabwean dollar. Despite the fact that the reason for the collapse of previous currencies was usually hyperinflation, which Bitcoin makes impossible, there is always a possibility of technical errors, competition from other currencies, political actions and so on. According to the basic practical rule, no currency can be absolutely insured against collapse or difficult times. Bitcoin has proven its reliability over the years since its launch, and it has a huge growth potential. However, no one can accurately predict what kind of future awaits Bitcoin.
A rapid price increase does not necessarily mean a bubble. A bubble is an artificial price overstatement, which eventually leads to downward correction. The reason for the bitcoin price fluctuation is the sum of individual actions of hundreds of thousands of market participants, fluctuations occur while the market is looking for the true price. The reason for the change in prices may be the loss of confidence in Bitcoin, the large gap between the fundamental value based on the characteristics of the Bitcoin economy and its current price, increasing media coverage, which stimulates the speculative component, fear of the unknown, and eternal irrational differences between fear and greed.
The Ponzi scheme, or pyramid, is a fraudulent investment operation that pays income to its investors from their own money, or from the money of subsequent investors, and not from income earned by people running their business. Ponzi's schemes are designed to collapse when paid to the latter investors when there are no new applicants.
Bitcoin is an open source project, without a central authority. Consequently, no one has the power to make fraudulent statements about investment income. As with other major currencies, such as the US dollar, euro, yen, gold, etc., there are no guarantees of purchasing power, and exchange rates move freely. This leads to price volatility, at which bitcoin owners can unpredictably buy and lose money. In addition to speculation, Bitcoin is also a payment system with useful and competitive properties used by thousands of users and companies.
Some of those who previously supported the project have large amounts of bitcoins because they accepted all the risks and invested time and resources in untested technology that was almost unused by anyone and which was much more difficult to properly secure. Many of them spent a huge amount of bitcoins before they became so valuable or bought a small number of them and did not make large profits. There is no guarantee that bitcoins will grow or fall in the future. This can be compared to investing in a startup that can either acquire value due to its usefulness and popularity, or it can completely burn out. Bitcoin still hasn't grown out of short pants, it was developed with a very long term; it's hard to imagine how it could be less biased to those who supported it before. In addition, today's users can also become "those who supported him before" for those who come tomorrow.
The Bitcoin system is unique in that only 21 million bitcoins can be created. However, this will not be a restriction, because transactions can be denominated in small denominations - for example, in bits - each bit is one millionth of bitcoin. Bitcoin is divided to 8 decimal places (0.000 000 01) and potentially even further if required due to a decrease in the average size of the transaction.
Deflationary spiral theory says that if everyone expects prices to fall, people will put their purchases for the future to benefit from low prices. This drop in demand, in turn, will lead entrepreneurs to lower prices to try to stimulate demand, thereby worsening the situation leading to economic depression.
Although this theory is a popular way to justify inflation among central banks, it is only an unproven theory that is considered controversial among economists. Home appliances are one example of a market where prices are constantly falling, which, however, does not lead to a depression of this market. Similarly, the price of bitcoins has risen over time and at the same time the volume of the bitcoin economy has also been constantly growing with it. Since both the value of the currency and the size of the market began from scratch in 2009, Bitcoin is a counterexample for this theory, showing that it may be wrong.
Despite the above, Bitcoin is not designed to be a deflationary currency. More precisely, it is expected that inflation awaits Bitcoin in the early stages, and stability can only be achieved in many years. The only reason why the number of bitcoins in circulation may drop over time is if people carelessly lose their wallets without making or not making a backup correctly. With a stable monetary base and a stable economy, the value of the currency must remain unchanged.
It's like chicken and egg. In order for the price of bitcoins to stabilize, a large-scale economy is needed to cooperate with a large number of companies and users. To develop the economy to a large scale, entrepreneurs and users will look for price stability.
Fortunately, price fluctuations do not affect the main advantages of Bitcoin as a payment system designed to transfer money from point A to point B. It is possible for companies to instantly transfer payments in bitcoins to their local currency, allowing them to earn income from the benefits of Bitcoin, but without being affected by price fluctuations. As long as Bitcoin provides many useful and unique features and capabilities, many users will deliberately choose it. With such solutions and incentives, it is possible that Bitcoin will eventually grow to such a level that price fluctuations will be limited.
Only part of the currently released bitcoins are put up on exchanges and exchangers for sale. Bitcoin markets are very competitive, which means that the price for bitcoin will rise or fall, depending on supply and demand. In addition, new bitcoins will continue to be produced for future decades. Therefore, even the most determined buyer cannot buy up all existing bitcoins. This situation does not mean, however, that markets are not vulnerable to price manipulation; it still does not require much money to shift market value down or up, and therefore Bitcoin remains an asset with fluctuating value.
It can happen. At the moment, Bitcoin remains a much more popular decentralized virtual currency, but there can be no guarantee that it will remain in this position. There is already a set of alternative currencies inspired by Bitcoin. However, it can be assumed that the new digital currency will require very significant improvements in order to overtake Bitcoin in a stable market, and even this is not yet guaranteed. Presumably, Bitcoin can adopt technological improvements made in a competing currency, as long as this does not apply to the fundamental parts of the protocol.
Receiving bitcoin payment is almost instantaneous. However, there is a slight delay before the network starts confirming your transaction, including it in the block and before you can spend the bitcoins you received. Confirmation means that there is a consensus on the network that the bitcoins you received have not already been sent to someone else and are considered your property in the future. Once your transaction is included in one block, it will continue to receive confirmation from each subsequent block, which will indicate a strengthening of this consensus and reduce the risk of cancellation of the transaction. Each transaction takes between a few seconds and 90 minutes, with an average duration of 10 minutes. Each user is free to choose at what stage to consider the transaction confirmed, but 6 confirmations are usually recognized as secure as the 6 months period for a credit card transaction.
Transactions can be made without commissions, but an attempt to make a free transaction can significantly slow down the transfer. And although the commission may increase over time, it is usually a tiny amount. By default, all bitcoin wallets listed on Bitcoin.org select a suitable commission and allow it to reconsider it before making a transaction.
Transaction fees are used to protect themselves from users who make transactions in order to overload the network and as a way to pay miners for their work in supporting network security. The more accurate purpose of the work of the commissions is still being developed and will continue to change over time. Since the commission is not tied to the number of bitcoins sent, it may seem incredibly small or unusually high. The commission is determined by parameters such as data sent with the transaction and transaction repeatability. For example, if you receive a large number of small amounts, then the sending fee will be higher. If your activity uses traditional-style transactions, you won't have to pay an unusually high commission.
Everything will be fine. You will see bitcoins the next time you run your wallet program. In fact, bitcoins do not enter the program on your computer, but are added to the public registry, which is located on all devices included in the network. If bitcoins were sent to you when your wallet program is not running and you start it later, it will load the blocks and see all the transactions that you did not yet know about, and the bitcoins will eventually appear as if they had just been received. Your wallet must be launched only when you need to spend bitcoins.
Long synchronization is required only for full-fledged network nodes, such as Bitcoin Core. From a technical point of view, synchronization is the process of downloading and checking all previous bitcoin transactions on the network. Some bitcoin clients need to be aware of all previous transactions to calculate the total balance of your wallet and make new transactions. Synchronization may require a lot of computer resources, a corresponding Internet channel speed and enough disk space to accommodate the full volume of the block chain. In order for Bitcoin to remain safe, a sufficient number of people should use full-fledged bitcoin nodes, because they perform the task of checking and relaying transactions.
Mining is the process of using computer resources to process transactions, ensure network security, and synchronize the status of all users in the system. Mining can be perceived as a Bitcoin data center, except that it has been designed to be fully decentralized, while its participants can be in any country and no one has control over the network. This process was called "mining" by analogy with gold mining, because it is also a temporary mechanism used to produce new bitcoins. However, unlike gold mining, bitcoin mining generates rewards in exchange for important services necessary to ensure the security of the payment network. Mining will still be needed, even after the last bitcoin is released.
Anyone can become a bitcoin miner by running software on specialized equipment. Mining technique listens to the broadcast of transactions through a decentralized peer-to-peer network and performs the necessary tasks to process and confirm these transactions. Bitcoin miners do this work because they can earn commissions from transactions that users pay to make faster transactions and newly created bitcoins, which are produced according to a consistent formula.
In order for new transactions to be confirmed, they must be included in the block, together with the mathematical justification of the work performed. This evidence is very difficult to create, because there is no other way to do it than to try millions of calculations per second. Miners perform these calculations until their block is accepted by the system and they receive a reward for it. When more people start mining, the difficulty of finding a new block automatically increases by the network to ensure that the speed of finding one block averages 10 minutes. As a result, mining is a very competitive business where no miner can control what exactly is included in the chain of blocks.
The proof of the work done also depends on the previous block to ensure the chronological order in the block chain. This makes it exponentially more difficult to cancel previous transactions, because it will require recalculation of the work done for all subsequent blocks. When two blocks appear at the same time, miners work on the first block they received, but switch to the longest block chain as soon as the next block is found. This allows mining to maintain and defend a global consensus based on computing power.
Bitcoin miners cannot cheat to increase their earnings, nor can they make fraudulent transactions that can damage Bitcoin networks, because all bitcoin nodes will reject any block that contains incorrect information, according to the rules of the Bitcoin protocol. Therefore, the network remains secure, even if not all bitcoin miners can be trusted.
The use of energy to operate the payment system and to ensure its security cannot be called a waste. As in the case of any other payment system, the use of Bitcoin entails operating costs. The services necessary for the operation of existing financial structures, such as banks, credit cards and transport for collection, also use a lot of energy. However, unlike Bitcoin, the total amount of energy consumed is not obvious and cannot be easily measured.
Bitcoin mining is designed so that over time it will become more optimized, with specialized equipment that consumes less energy, and its operating costs should be proportional to demand. When bitcoin mining becomes more competitive and less profitable, some miners stop their activities. In addition, all the energy spent on mining somehow turns into heat, and the most successful miners will be those who will also use this heat for something else. An optimally working mining network is actually one that does not consume any additional energy. Although this is an ideal, the mining economy is such that miners will strive for it themselves.
Mining creates some semblance of a competitive lottery, which makes it difficult for someone to consistently add all new block blocks of transactions to the block chain. This protects the neutrality of the network, preventing anyone from blocking any transactions. It also prevents someone from canceling their previous transactions, which can be used to deceive other users. Mining makes it exponentially more difficult to cancel previous transactions, because it will require recalculation of the work done for all blocks following this transaction.
In the first days of Bitcoin's existence, anyone could find a new unit using the most ordinary computer. As more and more people are starting to mine, the difficulty of finding new blocks has grown significantly and the only effective way to mine today is to use specialized equipment. You can go to BitcoinMining.com for more information.
Bitcoin technology - protocol and cryptography - has a time-tested high level of security, and the Bitcoin network is probably the world's largest distributed computing project. The biggest vulnerability in Bitcoin is the mistakes of users themselves. Bitcoin wallet files that store the necessary private keys may be accidentally deleted, lost or stolen. This is very similar to physical cash stored in electronic form. Fortunately, users can use security best practices to protect their money or use services that provide a good level of protection and insurance against theft and loss.
The protocol rules and cryptography used in Bitcoin still work perfectly, years after the creation of the network, which is a good indicator that the system is properly designed. However, various security problems have been and been fixed before, in various software implementations. Like any other software, the security of Bitcoin software depends on the speed at which these problems are found and solved. The more such problems are identified, the more mature Bitcoin will become.
There is often misunderstandings about theft and security problems that occur in various exchangers and bitcoin businesses. Although such problems arise, they are not related to the hacking of Bitcoin itself, and do not imply the innate shortcomings of Bitcoin; just as a bank robbery does not mean that the dollar is compromised. However, it should be recognized that users need to be provided with a set of best practices and simple security solutions to better protect their money, and to reduce the overall risk of theft and loss. Over the past few years, security features such as wallet encryption, offline wallets, bitcoin storage devices, and transactions that require multiple signatures have been developed.
You can't just change the bitcoin protocol. Any client program that does not comply with generally accepted rules will not be able to impose its rules on others. According to the current specification, double spending is not possible in the same block chain, as well as spending bitcoins without the correct signature. Therefore, it is impossible to create an uncontrolled amount of bitcoins from the air, spend other users' money, damage the network, or something similar.
However, most miners can in principle arbitrarily block or convert recent transactions. Most users may also insist on making some changes. Since Bitcoin works correctly only about full agreement between all users, changing the protocol can be very difficult and will require the adoption of changes by the vast majority of users, so that the rest of the users will have no choice but to follow them. In general, it is difficult to imagine why Bitcoin users will agree to accept changes that can compromise their own money.
Yes, most cryptographic-based systems are generally vulnerable, including traditional banking systems. However, quantum computers still do not exist, and most likely will not appear in the near future. By the time quantum computers become an immediate threat to Bitcoin, the protocol may be improved to use post-quantum algorithms. Given the importance of such an improvement, it can be expected that it will be comprehensively considered by the developers and accepted by all Bitcoin users.
New Bitcoin
Copyright © 2024 New Bitcoin - All Rights Reserved.