Bitcoins are all buzz. This virtual currency is now riding the rollercoaster of myths and speculation, and rising exponentially in the value and reaching $260 before plummeting at $130. Despite all sound & fury surrounding this currency, many people have hard time to know what Bitcoins are—or how it works. It is troubling, particularly if you are thinking to invest your money and time in this Bitcoin phenomenon.
To start your own bitcoin digital wallet is not necessarily the bad idea. Bitcoins are not tied to fortunes of single nation’s economy. They are simple to exchange, and are not subject to any kind of transaction fees. However, you have to know some important things before you throw out your money in the volatile market. You have to understand how Bitcoin system works or where it succeeds, or where it is weak.
Bitcoins are controlled by people
Bitcoin is one kind of algorithm-based mathematical chain—unit of measurement that is invented to quantify its value. It is like a dollar—but unlike dollar (or other type of the fiat money), Bitcoins are totally decentralized. Bitcoin algorithm was made by the developer with pseudonym Satoshi Nakamoto; however, this currency is created, traded & controlled by the Bitcoin users, instead by the central authority such as bank and government. Bitcoins are totally digital: You will not lay hands on the physical Bitcoin till you buy the physical facsimile.
All these physical BTC has the private key embedded under the hologram, which links to the Bitcoin address worth an amount shown on face of this coin.