Why Use Bitcoin

Bitcoin was created to facilitate electronic payment that does not require the use of a third party or a central authority for confirmation. Bitcoin is virtual. We cannot see and touch it. It can be transferred from one person to another person using bitcoin wallet.

In this digital world, Bitcoin has various application. Now people can use Bitcoin as a payment method while buying goods and services. Many companies and suppliers in developed countries accept bitcoin as payment method.

Bitcoin is traded like stocks. It is the most expensive stock in secondary market. Its price reached all-time high of $68,990.90 on Nov. 10, 2021. It prices fluctuate rapidly than other stock price. Its trade is done by those who can bear high risk in short period of time.

However, before we get into the benefits of Bitcoin, let’s look at what other options are. When we speak about alternatives, we don’t just compare Bitcoin to other currencies like the US Dollar, Pound, and Euro. But we have to consider different types of transactions. The amount involved, type of goods and services bought, and where the parties are located all affect how we use money.

To transfer small amount of money, we use coins and notes for convenience whereas for big amount of money cash transfer is not convenient. Bank cheques are often used to transfer larger amounts between people. Bank cheques cost approximately USD 5 per person and are therefore not economically feasible for values below USD 5.

There is no upper limit to bank cheques, but it can be cumbersome and requires that both parties go to the branch of the bank. This generally limits the use of bank checks for transactions within the country. Parties can also meet face to face or wait several weeks before they send a cheque.

EFT or credit card facilities are convenient for merchants. Merchants will need to pay several percent of the transaction value as commission and establish merchant facilities with their bank. A merchant could also face what’s called a “chargeback”, which is when the transaction was fraudulently made and the merchant is responsible to refund the money.

This is especially important for online merchants, who only have access to the card details. Credit card facilities and EFT are typically limited to amounts between USD 10-10,000.

International SWIFT transfers are the main method for transacting money across borders. Because of the high fees charged to banks, SWIFT transfers are not economically viable for amounts below USD 1000. SWIFT transfers take a long time to complete and can often take several days for recipients to receive payment. They are also susceptible to errors, which can lead to further delays in the transfer process.

Here are some benefits to bitcoins, which make them better than any other currencies.

No Banking Fees

Bitcoin users don’t have to pay traditional banking fees. It is standard practice for fiat currency exchanges that they charge “maker”, “taker”, and occasional withdrawal fees. Since Bitcoin is digital and no third parties confirmation is needed for successful transaction. It avoids cost like account maintenance, minimum balance amount, overdraft cost etc.

Bitcoins Cannot Be Stolen

The owner of Bitcoins can only change the ownership address. If someone has physical access to the computer of a Bitcoin user, they can only steal Bitcoins. Then they transfer the Bitcoins to their account. This system is much more difficult than traditional currency systems where you only need a few authentication details to gain access to your finances.

International Payments – Low Transaction Fees

Most foreign purchases and standard wire transfers involve fees and exchange costs. Bitcoin transactions do not involve government or intermediaries, so the transaction cost is generally lower than for bank transfers. This can be a significant advantage for travelers. Also, Bitcoin transfers are fast and can be done without waiting for approvals.

Bitcoin can be Digital and Decentralized

Bitcoin gives people the freedom to exchange value directly without intermediaries. This allows for greater control and lowers fees. It is quicker, cheaper, safer, and more permanent than traditional currency. Cash are issued and controlled by central bank of respective nations whereas Bitcoin is owned my users.

No Tracking

If users do not publish their wallet addresses, nobody can track transactions back to them. Nobody, except the wallet owners, can know how many Bitcoins they have. Even if the wallet addresses were publicly available, it is possible to easily generate a new address. This significantly increases privacy compared to traditional currency systems, which allows third parties to potentially access financial data.

Bitcoin Payments Are Mobile

Bitcoin users can use the internet to pay for their coins. To purchase a product, buyers don’t need to visit a store or bank. Personal information is not required for any transaction that buyer has to reveal while doing transactions on other online platforms.

Excellent Tool for Investment

Bitcoin can be used anywhere around the globe without having to go through any conversion. It is considered equal to Gold. It combines the best parts of cash and gold, while also allowing you to trade freely without any restrictions.

You can get your order instantly and absolutely free. Bitcoin makes it possible for merchants to accept payment without having to pay a chargeback. Another way to put it, Bitcoin payments can be accepted by merchants without any risk of being reclaimed by banks or third parties. If they wish, consumers and merchants can choose to pay for an escrow agent.

Customers can also benefit from this, especially if they are making online purchases. You may have experienced the frustration of getting your credit card denied because you are traveling or making a high-risk purchase.

A merchant may ask for proof of identity and address if you purchase equipment worth several thousand dollars. This can be frustrating and inconvenient for both the customer and the merchant. It also causes unnecessarily delays and extra effort to process the transaction. Bitcoin transactions are instantaneous, fast, and risk-free.

If you are a merchant who deals with international customers often, such as those in the tourism industry, then these benefits can be even greater. A boat charter operator is an example. The boat charter operator arranges for their customer to charter a boat for one week prior to their holiday.

A deposit in Bitcoin can be made instantly from anywhere in the globe, without the need to pay a fee or wait for foreign currency clearance.

Bitcoin’s other great advantage is the fact that it doesn’t require either party to give any sensitive information. This is totally contrary to the way EFT and credit cards work. When you make an in-store payment with your credit or EFT card, you will need to hand the card details along with your PIN/signature.

It’s amazing to consider how sensitive our PIN is to other people. Yet, we are perfectly happy to give it to a stranger. Although PIN-skimming devices are common in Australia they are much more widespread in other parts, especially for international travelers.

This risk is eliminated completely by using Bitcoin. You can make any purchase in the world by paying money to someone you don’t know.

Bitcoin also offers small amounts of payment, which is a major advantage over all other methods. You might be able to take your child to a shop and buy some chocolate or lollies worth ten cents. Or, sellers could sell a ringtone for 50 cents online.

Bitcoin makes it possible to make what’s known as micro-payments, which are small amounts or amounts that cost less than one cent. Bitcoin is not a line of credit. It is the digital equivalent of money, so you don’t need to be an adult in order to use it.

What about a traveler who urgently needs to send 100 dollars back to his country to help his mother? SWIFT transfers can be expensive and take many days. While a service like Western Union might be faster, it will be much more expensive. Bitcoin is instantaneous.

Bitcoin’s other major advantage is its controlled supply. Bitcoins are generated by Bitcoin mining. The Bitcoin protocol regulates the rate of Bitcoin creation. But we can tell you that the Bitcoin supply cannot be controlled or predicted and is not subject to manipulation by any individual, organization, government.

History has shown us many examples of governments generating more money than they need to support their economic goals. These interests often contrast with the interests that the currency holders have.

We have seen this create an inflationary spiral that could lead to the destruction of entire economies. Bitcoin isn’t subject to such manipulation because the protocol regulates the supply. This is known in advance by all who use Bitcoin.

While Bitcoin shares many similarities with cash, cash is limited in its ability to protect against accidental loss or theft. While Bitcoin isn’t immune from these types of losses, it does have some inherent properties that help protect your money from being stolen or lost. It’s safer than carrying cash in your wallet.

Traditional currency was not created for the digital age. It is a system that has been used for hundreds to thousands of years. This money system predates electricity and even the advent of the Internet. It was used in a trade back when there was no idea that songs could be sent between countries.

Financial institutions adapt their old systems to the digital age and create new systems to meet modern needs. As electronic commerce grew in demand, these systems became less efficient and new systems were developed to augment them.

The result is a creaking bank system that was never built for electronic transactions as they are now performed around the globe.

Bitcoin was originally designed to facilitate electronic transactions. It allows instantaneous electronic transactions anywhere in the globe, for any amount, and without the need to establish trust or depend on any third party.

Frequently Asked Questions