Technology is advancing by leaps and bounds. It introduces new terms and systems for business and communication every day. The Internet has made a major contribution to this development; especially when it comes to business. Online trading or online currency trade has recently attracted many traders. One of the most common forms of online trading is the Bitcoin Exchange.
What is Bitcoin?
Bitcoin exchange is a new currency system for the internet that works on the concept of digital currency. It started the peer to peer payment system for individuals without central authority. A new concept of crypto currency was first introduced in 1998. Cryptography controls the creation and transactions of digital money. Bitcoin works through a software system and does not have any central controlling authority so it is both managed and controlled by its users around the world.
Working with the Bitcoin Exchange
One can work on the Bitcoin exchange just like working on any other type of currency exchange. Just like working with banks, it is easy to make transactions through the Bitcoin Exchange. Similar to physical trading, the user has to pay to buy Bitcoins. The difference is that the person has to open an account with some Bitcoin Exchanger. The user’s paid asset can be used in the form of digital currency that can be used to purchase any type of product. Bitcoins can also be exchanged with other bitcoin holders. This system works similar to bank currency exchanges.
In almost all payment systems, payments can be reversed after a transaction via PayPal or credit cards. But with Bitcoin, the situation has changed, because after making a transaction, one can no longer recover it or return it. So be careful while exchanging your bitcoins for currency mediums as you may face chargeback issues. It is better to exchange with other bitcoin holders near you.
Benefits of Bitcoin Exchange
Bitcoin currency exchange is new. It is a type of software -based payment system where you make digital transactions. Here’s how it can benefit you:
· Perform transactions faster than other systems
· Always available for transactions
· Make transactions from anywhere in the world
· Make transactions more secure
· Perform transactions without the intervention of any third party
· Monitor all transactions from home PC or from Smartphone
· Buy any asset class using bitcoin
Disadvantages of Bitcoin
The Bitcoin exchange is an innovation in the world’s economic systems. If practically used, some drawbacks come as well. Some of these are as follows:
Ø Market acceptance
The number of bitcoin users is growing but it is still not a widely used currency or exchange system. The level of its acceptance in financial matters is even lower.
Since Bitcoin is not commonly used, it is not a stable currency. However, there is hope that this volatility will subside as the user list and value of bitcoins in the market become readily available.
Ø Partial improvement
A big problem is that the Bitcoin software is still in its beta phase and has many imperfect features, which still need to be fixed. New modules are under development to make bitcoin exchange safer for everyone.