Get on the express for Bitcoin: Know How Does Bitcoin Work and How to Use It like Money You probably have seen it discussed in the news or around the Internet. Heck, you may even have heard your techie friend babbling about at one point when you couldn't care less...until now, with a changed heart and reconsidered mind.
We're talking about the next big thing - bitcoin.
As you may or may not realize, the next revolution is upon us (if not already here) in how we will forever conduct monetary trade with the already large quantity of transactions done electronically every day and still on the rise where basically our money can be considered digitalized. And with that, arises bitcoin.
Are your still scratching your head...what is bitcoin? How does bitcoin work? In order to understand bitcoin, you have to understand the difference between currency and money.
Currency is a tangible form of money. In other words, money is intrinsic while currency is extrinsic. For example, paper can represent money; coins can represent money. In this case, currency equals those paper and coins as mediums of exchange. Currency has had an ever-evolving long history: from bartering with commodities like grains and livestock, to trading with stones and coins, and to using paper dollar bill money as we know of today.
The problem with the dollar bill or paper money is that the government can easily print more of this paper that represents money, and has been doing so...thus causing inflation with your paper money to worth less than it actually is. Contrast to gold, the government can't create gold like they do with printed money. The value is based on scarcity.