Bitcoin Gives You An Edge Over The Centralized Payment Systems

Bitcoin is the world’s first and the most beloved Cryptocurrency and decentralized payment system which offers a highly secure Peer-to-Peer exchange medium. Since the day of its launch in January 2009, it has come a long way ahead, forming a gigantic network of users which still seems to be expanding meteorically. Not only has it shown a remarkable progress over the last couple of years, Bitcoin happens to be the sole inspiration behind hundreds of other digital coins that are striving to dominate the Cryptocurrency landscape. Bitcoin is open-source which means anyone can use the original Bitcoin source code to create a bitcoin clone. As a matter of fact, all the other Cryptocurrencies are derived from the original bitcoin source-code provided by Satoshi Nakamoto.

Blockchain, The Backbone of The Bitcoin Network

As a matter of fact, all the banks and centralized payment systems also maintain a digital ledger or notary which stores your transaction details. This information proves that you have actually made a transaction on a particular date and time. It’s just that this ledger is only accessible to the banks or the transaction medium that you have used and is not shared with you or anyone else.

However, in case of Bitcoin, the ledger is shared with all the nodes in the network. Bitcoin makes use of a shared cryptographic ledger called Blockchain which maintains a tamper-proof record of all the transactions happening in the network. Blockchain is the key technology behind bitcoin which provides the requisite fuel to power up the Bitcoin. It is a peer-to-peer network which isn’t governed or controlled by any central organization. It is totally dependent on its peers. Unlike most of the banks and centralized payment systems, every blockchain user retains a tamper-proof copy of the ledger showing all the transactions taking place. In this way, Blockchain ensures a total transparency and in that case, if there happens to be a fraud attempt, it will be visible to all the users. So early steps can be taken to counter the threat.

While blockchain offers a high level of transparency to the users, it also maintains some level of anonymity. Although you can see the transaction details of all the bitcoin users, the actual identity of a user isn’t revealed. Instead, what you see is the account number or the wallet address from which the transaction is made. At a very basic level, blockchain is comprised of a series of blocks where each block stores a small patch of transactions. All these transactions are approved by Bitcoin miners and are included in a block which is then added to the Blockchain.

Also read Bitcoin ATMs Are Increasing In Massive Numbers. 
 

Bitcoin vs Banks & Centralized Systems

One of the greatest advantages of using Bitcoin is that unlike the traditional payment systems, it is decentralized and doesn’t require any central system or middleman, governing and controlling the transactions. Usually when we make payment or transfer money via a debit/credit card, it has to go through a centralized payment gateway. Each transaction that we make online is approved by the bank first before reaching the intended receiver. And in most of the cases, banks charge a small transaction fee for each transaction that you make. You don’t really notice this fee being charged by the banks if you transfer money locally or if the amount of money being transferred is not that high. But if you transfer money across the international borders, you would realize high exorbitant these transaction fees can be.

In this context, Bitcoin gives you the ultimate advantage as it requires minimal transaction fee or no transaction fee at all. Most of the bitcoin transactions happen free of cost regardless of the fact that it’s a local or international transaction. But there are certain points where you do actually have to pay a small transaction fee. However, you can always choose not to pay these fees but that way, your transaction will take longer than usual to be approved. But whatever be the case, the bitcoin transaction fees are much lower compared to what the banks and other payment systems charge.

So you can’t deny the fact that Bitcoin is clearly having an edge over all the conventional payment systems and it can revolutionize the way we make online purchases and exchanges.