What is a Cryptocurrency?   What is Bitcoin?

A cryptocurrency is a medium of exchange using cryptography to secure the transactions and to control the creation of new units. Cryptocurrencies are a subset of alternative currencies or specifically of digital currencies. Bitcoin became the first decentralized cryptocurrency in 2009.

A type of digital currency in which encryption techniques are used to regulate the generation of units of currency and verify the transfer of funds, operating independently of a central bank. Put very simply, it is a new form of money that works extremely well on the internet.

Is it a "virtual currency"? So what's all the fuss about?

No. Virtual currencies are generally tokens issued by a company for near-exclusive use on their site. Bitcoin is a general purpose digital currency. it is programmable money. In a similar way that email revolutionised the postal service, Bitcoin can revolutionise financial services.

Bitcoin only started on 3rd January 2009, it is still very early days in its growth. It represents a completely different form of money. There are lot of potential new forms of businesses to emerge which will affect the way we could conduct business in the 21st century.

Government and Taxes Regulation Bitcoin is not Anonymous

Bitcoin is not an official currency. That said, most jurisdictions still require you to pay income, sales, payroll, and capital gains taxes on anything that has value, including Bitcoins. It is your responsibility to ensure that you adhere to tax and other legal or regulatory mandates issued by your government and/or local municipalities.

Some effort is required to protect your privacy with Bitcoin. All Bitcoin transactions are stored publicly and permanently on the network, which means anyone can see the balance and transactions of any Bitcoin address. However, the identity of the user behind an address remains unknown until information is revealed during a purchase or in other circumstances. This is one reason why Bitcoin addresses should only be used once.

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