With the world running on the Internet, can currencies be far behind. Today, it is a virtual environment out there. You read digital newspapers and books, hear live music streamed directly to your Bluetooth earphones and send emails instead of sticking postage stamps on envelopes. This radical transformation in people’s lives is because of the Internet, a medium that connects people globally without national borders or boundaries.
The latest entry in the world of Internet is crypto currency, a peer-to-peer electronic and digital currency that is known as Bitcoin. The concept of Bitcoin is a recent one, as late as 2009, but within a short span of 5 years, it has taken the world by storm. This is because Bitcoins can be used to pay for goods and services received, carry on trade and any other transaction that can usually be done by a normal currency.
Bitcoin is a peer-to-peer electronic and digital currency. Often termed as virtual currency because of its specific characteristics, its properties are almost similar to legal tender of all countries. The difference is that not all governments have given it the stamp of legitimacy. Other than this you can trade in it, accumulate it in your Bitstamp account, pay for goods and services received and even transfer amounts across continents.
Crypto currencies like Bitcoins are based on the Blockchain technology which is basically a distributed ledger system. Bitcoins are deemed to be tool or a resource within the Blockchain network. All Crypto currency deals and monetary aspects have a link with a Blockchain token or a sub-token.
A Bitcoin trading platform facilitates Bitcoin related transactions and ensures that they can be made with ease. These are almost like the traditional stock exchanges where shares and securities are traded with many statutory restrictions in place. A Bitcoin exchange has to function with a lot of responsibility. A Bitcoin deal is not made through normal fiscal and banking routes of a country. It bypasses all of them and is therefore impossible to monitor by any federal or law-enforcing agency. Moreover Bitcoins are encrypted and virtually untraceable. Further, there are no KYC or AML restrictions in place for personal transactions in Bitcoins.
This is the reason why Bitcoin trading platforms ensure that everything is above the law. They assure security and safety as well as scalability and liquidity in the Bitcoin environment. Rigid and uncompromising regulations are in place and periodical external audits too are carried out to make certain that safety measures are unfailingly followed and that all data is encrypted and secure.
No third party verification like those in credit card issuance is carried out by any agency unrelated to a crypto currency transaction. This part is undertaken by the trading platforms themselves whereby all relevant information on the identity of the users availing their services are first taken. The focus is on getting the true identities of the buyers and sellers so that the interests of both can be safeguarded.
Selling of Bitcoins done through these platforms can only be concluded after buyers reveal full details about themselves. It is because of these stringent regulations that any Bitcoin trading platform can be trusted to carry out a safe and secure Bitcoin transaction.
Within its network it is deemed to be a unit of currency that is linked to a Bitcoin address. For security and safety, it takes the help of public-key cryptography in its trading. No physical tokens are exchanged. A transaction log also known as Blockchain has all the details of the owner of Bitcoins. This is as simple as it can get for an insight into the world of crypto currencies that has gained immense popularity because of the Internet.