1: What is digital currency? What is Bitcoin?
Answer: In 2008, a mysterious person "Satoshi Nakamoto" published a paper on the Internet called "A Peer-to-Peer Electronic Cash System", which described an Internet currency based on peer-to-peer technology and cryptography. The paper attracted the participation of cryptographers, computer scientists, and computer geeks. This is Bitcoin today. People usually refer to bitcoin as this type of currency as "digital currency" or "virtual currency". In fact, a more accurate name should be called "point-to-point cryptography digital currency". It is different from game currency or corporate tokens (such as Q currency), and also different from the electronic version of legal tender. The biggest difference is that it is decentralized.
The characteristics of this digital currency are summarized as follows:
1: Decentralization, data is distributed and stored in nodes on the Internet. This makes it safe, transparent, and impossible to fake.
2: Global circulation, anyone can use, collect and transfer as long as it can be connected to the Internet. There are no restrictions on countries, regions and status.
3: Independent property, as long as you keep your wallet private key, no one can deprive you of your property.
4: Anonymity, for example, you can create a payment address for yourself without providing any personal information.
High-quality digital currency can be used for:
1. Value storage and appreciation.
2. Hype & investment & speculation.
3. Global circulation, cross-border transfers.
4. All kinds of black and gray market use.
5. Various other fields.
In the 1990s, computer scientists and cryptographers tried to create a world currency similar to Bitcoin, but they have not been able to make breakthroughs. Because a world currency must be trusted by everyone, it is as difficult as unifying the world. It was not until the emergence of Satoshi Nakamoto's plan that breakthrough progress was made. Bitcoin has designed a set of system operation rules based on blockchain technology and cryptography, under which all currency issuances are fair and transparent. (Technical details are not introduced here, the corresponding video link will be provided at the bottom of this article.)
In order for human beings to survive better, they must cooperate. Collaboration involves transactions, and transactions require currency. The world currency allows all mankind to collaborate more closely. This is the important part of Bitcoin.
2: What are altcoins and altcoins, and do they have investment value?
Answer: The source code of Bitcoin is public. Some modifications can be made on the basis of the source code of Bitcoin to create a digital currency similar to Bitcoin. This is an altcoin. If innovative technical improvements are made, it can be called a second token or altcoin. Usually people are collectively referred to as altcoins. Most altcoin altcoins are gradually dying out due to the author's weak technical strength, lack of advantages, long-term failure to maintain, lack of promotion, lack of team formation, etc., and they have no investment value. Only those excellent currencies developed by a team with strong technical strength and innovative ability have investment value. If you invest in excellent currencies correctly, you will get very generous returns. There are still many wealth opportunities in this industry.
3: Since it is a "virtual, digital currency", why is it valuable?
Such as Bitcoin worth thousands of dollars. To understand this problem requires knowledge of currency. The essence of currency is just a medium of transaction. It can exist in any form and does not need to be valuable, but currency must have a certain rarity and easy circulation. For example, the renminbi itself is just a piece of paper, such as gold and silver itself is just a rare metal, for example, the money in online banking is actually just bytes stored in the hard disk. But because people need a medium to make transactions, currencies have value. Legal tender is supported by national credit, but once the person in charge of currency issuance (the central bank) abuses currency, it will cause inflation, so the value of money depreciates and prices soar. Fiat currency will always depreciate, and the reasons for depreciation are more complicated and will not be detailed. Gold and silver can be used as currency without any credit guarantee. This is because its scarcity can ensure that using it as a transaction medium will not cause confusion in the commercial system. However, due to factors such as inportability, difficulty in dividing, and easy to be counterfeited, gold and silver are only used as precious metal commodities for investment preservation in modern times.
Digital currency does not bear the credit of any institution or country. The digital currency user group distributed all over the world is its credit system. Therefore, the larger the user base, the more valuable the digital currency. For example, Bitcoin currently has hundreds of thousands of active addresses and is still growing rapidly, and the Bitcoin usage rules limit the issuance of only 21 million coins, and it will not be spammed. At the same time, it is a hard currency that can be used globally. This is why digital currencies such as Bitcoin can be valuable and can appreciate.
4: What are the advantages of digital currency compared to other financial investment products?
(1) Investment & speculation & speculation are easy, just take a few minutes to register and open an account on the trading platform to start trading.
(2) The threshold is low, one or two hundred yuan can participate in investment speculation.
(3) 365 days a year * 24 hours unlimited transactions, easy to change hands, it can be said to be the best hype product.
(4) The coverage is wide, and there is no country or region restriction for global traffic.
(5) Easy to popularize, easy to use, easy to manage and collect.
(6) The prospect of appreciation is good. At present, there are very few people participating in the digital currency industry. Layout of excellent currencies in advance will surely get amazing returns in the future.
5: Is digital currency legal? How do national policies stipulate?
Answer: The five ministries and commissions including the Central Bank issued the "Notice on Preventing Bitcoin Risks", stating that digital currencies such as Bitcoin are not real currencies and should not be circulated in the market as currencies. But it can be bought and sold freely as a commodity, and the people have the freedom to participate at their own risk. (The "Notice" is on the official website of the central bank. A link will be provided at the bottom of this page.)
The regulations of most other countries are similar or more open to the notices of my country's five ministries and commissions. A few countries (such as Germany, Japan, etc.) allow digital currencies as currency in circulation. A few countries ban Bitcoin (such as Venezuela, Russia), but recently Russia’s regulatory policies on Bitcoin have begun to relax and exchanges have been established. The overall trend is becoming more and more open.