Bitcoins emerged on the face of the global financial market in 2009, since then it has cemented its place in the market. Although governments have been slow on the uptake, nevertheless bitcoins have become an alternative form of payment, accepted widely. However, it would be wrong to say that bitcoins have become globally accepted. The main reason why countries have been reluctant or slow to recognize bitcoins is that bitcoins are based on the distributed ledger technology that makes bitcoins or any other cryptocurrency decentralized with end to end encryption. For one reason, governments are not to keen to have a currency that is decentralized and not controlled by central banks, secondly, governments want to know what their subjects are doing and the level of protection given by the blockchain technology to the user doesn`t sit well with governments. Although this argument is valid to some extent from the government`s point of view because bitcoins have been used in some illegal and illicit activities, but the same is true for cash as well. Dealing in cash makes it very difficult for auditors and forensic experts to establish a money trail. This, however, is not a substantial reason not to embrace bitcoins.
What Is The Blockchain?
One major reason apart from the ones mentioned above is the blockchain technology. The financial and regulatory framework prevalent in the world is suited for conventional financial transactions blockchain technology is revolutionary in its nature and thus back in 2009 when it was first introduced it was incompatible with the laws and regulatory framework. This technology, including the conversion of currencies like ETH to AUD, initially clashed with existing laws and regulations. Over the last decade or so, countries, especially in the European Union, have tried to upgrade their regulatory frameworks and doing so has opened up the potential of blockchain technology to change the financial world.
Germany is currently carrying out legislation to present a framework, whereas countries like Liechtenstein, Switzerland, and Estonia are ahead of the game and they are attracting investors who are interested in investing in crypto-assets and distributed ledger technology. This means that bitcoins are here to stay. As more and more countries upgrade their regulatory frameworks, the accessibility of bitcoins will increase.
So with a future where bitcoins and other cryptocurrencies will be traded more frequently, are you aware of how to use bitcoins? Because if you aren`t then you risk missing out on this technological revolution that is in the making.
Let us first go over some essential information about bitcoins. DLT technology makes it impossible for bitcoins to be counterfeited. The public and private keys are set up in such a manner that hackers cannot create counterfeit coins. Since 2009, the system has been running smoothly. Bitcoins can be used to send and receive money anywhere in the world (provided that it is legal in both countries). Bitcoin payments cannot be blocked, which is why many people prefer it, bitcoin payments can beat sanctions and political leverage tools thus promising a world where currency cannot be used as a weapon.
How To Purchase Bitcoins
Before you can use bitcoins you will need to purchase bitcoins. To do this you will need to fulfill some pre-requisites first.
Prerequisites
First, you will need to have a bitcoin wallet. Bitcoin wallets are digital wallets where your bitcoins will be stored. There are different types of bitcoin wallets, each with their own features. Some common forms of wallets include paper and hardware wallet, these provide maximum security, online, mobile and desktop wallets, these provide relatively lower security but are more convenient and allow users to carry out transactions with bitcoin son the go. You can check out the following bitcoin wallet providers.
- Copay
- Atomic Wallet
- Bread wallet
- Airbitz
- Coldcard wallet (Hardware wallet)
- Ledger wallet(Hardware wallet)
Once you have got your wallet, you can move on to the next stage of actually purchasing bitcoins. Bitcoins can be purchased in many ways, three of the most common ways are
- Bitcoin exchanges
- P2P Bitcoin directories
- Bitcoin ATM
You can buy Bitcoin with credit card, bank transfer or cash. Cards carry the highest fees on transfer but they provide ease of transaction and instant transfer of bitcoins. Bank transfers are the cheapest as the rates on ACH and SEPA bank transfers are very low, less than half compared to those on cards but bank transfers take between three to five working days to process. If you are looking to not share your data with regulatory authorities then you may want to avoid banking channels and use cash instead. You can purchase bitcoins through bitcoin directories using cash or you can buy through friends or family members directly. There are also some Facebook and Whatsapp groups that match bitcoin sellers with buyers but this is a high-risk area as there have been stories of scams among these groups. It is better to use a trusted source or platform to transact in bitcoins because given the nature of the technology that underpins the bitcoins, it is not so easy to trace and discover anyone once they have carried out a scam on unsuspecting users.
How To Use Bitcoins
Once you have purchased bitcoins, the bitcoins will be transferred into your bitcoin wallet. Now, if you have got a mobile wallet, with an app on your smartphone, then you can use your phone to make payments for you. Many bitcoin merchants have got terminals where you simply have to scan the QR code and the payment is made automatically. So if you are a frequent user of bitcoins and you use bitcoins to carry out daily transactions then a mobile wallet can really help you.
One thing to keep in mind is that you can only use bitcoins for purchases if the merchant you are buying from accepts bitcoins. There are a lot of merchants that accept bitcoins, but there is still room for improvement in this case. If you want to make a purchase, you will simply have to use your wallet to purchase the goods and services that you want. Using bitcoins is simply like using a credit card.
You can use the following directories to search for merchants who accept bitcoins:
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Airbitz
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Open Bazaar
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Coinmap
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Purse.io
By simply following these steps, you can purchase and use bitcoins with ease. If you were apprehensive about using bitcoins at the beginning of this article then I hope that your apprehension has gone away now. Using bitcoins is just like using cash or credit cards. As far as the ease of use is concerned there really isn`t much of a difference and this is why if more people know that using bitcoins is so easy, perhaps more and more countries would embrace bitcoins.