Is Bitcoin A Safe Option?
Popular cryptocurrencies like Bitcoin and Ethereum frequently make it to the headlines due to their volatile nature. Additionally, updates on hacks and Bitcoin scams make their rounds, raising suspicion among traders. On the contrary, Bitcoin seems promising in terms of security. Let’s technically analyze their financial security system with studies broken down by our experts.
So what are Bitcoins?
A digital currency founded in 2009, Bitcoin was the first to publish and lead the way to crypto fame. It is also the most volatile digital coin, the parent that every other cryptocurrency follows. Bitcoin runs on a peer-to-peer blockchain network that registers all the transactions digitally. As a decentralized currency, it operates without any monitoring from regulatory authorities.
Bitcoin started from scratch and progressed at the speed of flash. The first ever commodity purchase against Bitcoin was made by Laszlo Hanyecz when he ordered two pizzas worth 10,000 Bitcoins. It implies that Hanyecz ordered the most expensive pizzas since Bitcoin crashed at $65,000 per coin with its record-breaking price climb, making the pizzas worth $650 million.
Further, Bitcoin’s success story has paved the way for thousands of other digital coins like Ethereum, Dogecoin, Solana, Cardano, etc. Any person with the knack and technical knowledge can develop a cryptocurrency. While it might seem unsafe with growing crypto and bitcoin scams, blockchain technology is known to be incredibly robust.
Why is Bitcoin Considered Secure?
Bitcoin is built on a secure blockchain technology that works through encryptions. It is also a publicly decentralized and permission-free platform. Although investing in Bitcoin can be risky due to its market volatility, it is otherwise considered a certain financial asset. Let’s learn all the reasons that make Bitcoin safer to trade;
Unlike other financial assets, Bitcoin is a digitally advanced product with innovative and improved technology. Blockchain technology links and secures users with cryptography. It ensures that the data protection is set up to be unbreakable and that the transactions aren’t reversible. Furthermore, since blockchain has many volunteers, it signs hashes and verifies transactions on its network with the help of cryptography.
Bitcoin makes its data freely available which brings transparency. Although going public isn’t generally correlated with being safer, it’s an exception with Bitcoin. Since its ledger shows all the transactions, anyone can access these details without hampering the user details as they are kept anonymous. It means that there is nothing for a hacker to explore here. Additionally, it is safer compared to traditional firms and their data breaches since Bitcoin does not ask or reveal your financial or personal details each time you trade.
Although the security system is built to be strong, blockchain has confronted some rare yet gigantic hacks in its history. In addition, other stirring problems like Bitcoin Scams suggest that users make the most of the security provisions by configuring two-factor authentication.
Bitcoin is exchanged and traded on a decentralized platform that isn’t governed or regulated by the authorities. It runs on a distributed network with thousands of nodes worldwide, tracing and recording all the transactions transpiring on its system. With a vast group of nodes, users do not have to worry about any hacks. If any of the nodes or servers go down, the rest of the nodes cover up for it. This also means that any hacker toiling to kick into any one of the servers is aimless, as the remaining nodes and servers would block the hack. Unless the hacker gains control over 51% of the servers/nodes, they are unlikely to meet their end.
Bitcoin Isn’t Your Approval-Seeking Person.
Bitcoin is a publicly accessible cryptocurrency that is open to all. As a decentralized network, no authority oversees its actions. Since it does not require any permissions or approvals, it extends fair treatment to all users.
Don’t Know What the Blockchain is about?
We understand that cryptocurrencies and their related terminologies are hard to grasp. For a beginner, blockchain might be something as close as rocket science or a mathematical equation that keeps getting confusing the more you try to solve it.
Blockchain is similar to an accounting ledger, but it is digitally maintained. It uses hash functionalities to render a dedicated fingerprint to each transaction, registering and verifying them. Finally, each signed and the authenticated transaction is deemed unique and transferred to a block. The data then turns unalterable. Such blocks, when combined, become a blockchain.
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Should I Trade in Bitcoin?
Every trader is free to make choices as per their preference, knowledge, and experiences. If you are worried about security, Bitcoin is a safe choice. It is safeguarded with the 256-bit SHA hash functionalities and the degree of protection practiced by banks, VPNs, and the military. Although their network is impossible to hack and your data is encrypted, your wallet isn’t kept anonymous. While the crypto market is volatile, your funds are also exposed to wallet hacks, theft, or bitcoin scams if you aren’t wary enough. Start by learning about Bitcoin, how it works, analyze its performance, and ensure you take the safety measures critical to keep your funds secure.
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