Why was Bitcoin created?
Satoshi Nakamoto, the brilliant and mysterious creator(s) of Bitcoin, had a simple goal that they wanted to achieve with the currency. They wanted to create a digital currency that allowed people to send and receive funds from person to person(p2p). There would be no third parties because there wouldn’t be a need for one. Traditional currencies require the involvement of a centralized bank or a centralized financial payment system to operate.
This proposed Bitcoin system would be decentralized and work under the proof of work consensus. This meant that no one would control or monitor it. You could send Bitcoin in the morning and receive Bitcoin late at night with relative ease. All you would need is a wallet and an exchange. You can get both with your free account on ValorExchange. It’s safe, secure and all you need to get started is an email and a phone number.
At the time of its creation and introduction to the public, the US was facing a financial crisis. People lost their homes, life savings, and lots more. There was a general mistrust of banks and the government. It is impossible to guess Satoshi Nakamoto’s thinking at the time, but they obviously wanted to improve things. The people had put their faith in a system that failed them, and Satoshi Nakamoto wanted to give them a new option.
Using Bitcoin means no third parties could monitor or interfere with your financial transactions. This was because Bitcoin used digital identities that granted users anonymity on the blockchain. Sort of like a shirt that made you invisible. There were no taxes on Bitcoin, no regulation, and no restrictions.
Of course, this attracted a lot of criminal activities. The decentralized digital currency became known as the currency of the dark web, which greatly affected its adoption by the public in general. People saw the digital currency as an illegal tool for illicit activities, and for a time, it felt like Satoshi Nakamoto’s goal for the coin would end there.
Luckily, this began to change as time marched on. The price and uses of Bitcoin has now skyrocketed.
Why was Bitcoin created?
Bitcoin was created for specific purposes, such as:
Trustless banking: A great deal of faith is put into the centralized banking system as a whole. You trust the bank with your name, address, and many other personal information. You give them your savings in good faith that they’ll protect it on your behalf, and all you’d pay is the occasional bank charge here or there. In 2009, Bitcoin was introduced along with the blockchain. The blockchain would act as a decentralized immutable history book on all transactions in the ecosystem. If person A sends money to person B, it is noted on the blockchain for all to see. Although the names, locations and other personal information are omitted.
Privacy: One of the biggest pros of Bitcoin is the level of privacy it gives to a transaction. Traditional centralized banks often have records of financial activities that a person carries out with the bank as well as other personal information on the person. They not only know what you do with your money but when, where, and sometimes why. It’s like having a parent that follows you everywhere as an adult.
Bitcoin and the blockchain offer a third option whereby no one but you and the other party involved can know what transactions you carried out.
Means of exchange: While the above is more for particular interest uses, the average user might be more inclined to use Bitcoin to purchase goods. As the Bitcoin market size grows, it will become increasingly common for it to be used to do so. Bitcoin is, first and foremost, a digital currency.
In conclusion
Currencies that are not policed or regulated by any government are essential. Bitcoin gives a sense of financial freedom that cannot be competed against.
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