Latest posts of: drdanishkhan

OKaaay.. Here goes.. just the basic knowledge for newcomers..

1st What is Bitcoin ?

Bitcoin is a cryptocurrency ie online currency.. bitcoin started way back in 2008 and was created by a pseudonymous developer Satoshi Nakamoto..
He realised that our daily fiat currencies are being manipulated by the world govenments and felt the need for a currency which was un regulated and could not be manipulated by the world banks and so bitcoins were born.. its the currency of the financial revolution as i like to call it.. You gain bitcoins by iether mining it using computers or you can buy and trade them at exchanges like Mtgox.. the real advantage is that bitcoins are totally anonymous and doesnt involve any intermediaries like Banks.. its somewhat like barter system.. peer to peer..

What makes the prices of bitcoins go high and low, i just didnt understand the concept??

Well the prices of bitcoins ideally depends on the supply demand phenomenon..
However the recent price swing have many contributory factors

Factors which led to an increase in the prices of the bitcoins recently being :
1. Growing media attention..
2. EU crisis.. Greek economic collapse and austerity measures etc
3. Wider acceptability ie. bitcoins being accepted as a form of payment in some parts of the world
4. Increase in the number of people who are realizing the approaching financial collapse and have lost faith in the fiat currencies and are investing in cryptocurrencies as they are less likely to be manipulated and are anonymous.. after all why should the government care where i spend my hard earned cash..
5. Growing Infrastructure.. like the upcoming bitcoin ATMs..
6. there is a fixed amount of bitcoins 21 million so the supply is fixed as more and more institutions adopt bitcoin the demand will increase.. so will the prices in the future..

Factors leading to decrease in prices:
1. DDOS attacks on various exchanges
2. Human psychology.. whenever an exchange is hacked or people perceive threat there are massive panic sells that cause the prices to drop because people wan to save as much as possible..
3. The fear of government intervention is also one of the factors that led to panic selling.
4. Greed and Hoarding.. Most people today are not willing to use there bitcoins as currency because they believe that the value per coin will rise in the future so its being treated like a stock.. since there is hoarding of bitcoins there wont be enough for exchange and the prices in due course will fall..

But we need to realise the true intent of bitcoins.. If the majority believe in bitcoin and its potential as an alternate non manipulative currency bitcoin shall flourish otherwise it will fail..
Today the prices are more or less speculative..bitcoin is a highly volatile market and as many wise people say.. invest only the amount which you are willing to lose.. and i would strongly advice all the same.. Do not be greedy.. bitcoin is not a get rich quick scheme as many believe, its a form of revolution and our stand against the fake fiat currencies..

Where can I use these bitcoins?

In India sadly there arent many merchants or traders willing to use bitcoin owing to the massive price swings.. However in US many small merchants and traders have started accepting bitcoin as the form of payment.. you can buy snacks like pizzas and coffee with bitcoins. and as the days pass more and more merchants will start accepting bitcoins and then perhaps someday it may replace the fake fiat currencies of the world..

Do Indian shoping websites accept them??

Sadly none of the indian shopping websites accept bitcoins as a form of payment at the moment.

What is the real advantage and use of buying them???

Well this is a question best answered yourself.. I bought bitcoins because i strongly believe that cryptocurrencies will replace the fake fiat currencies in the near future and therefore have bought some.. Its my stand against the manipulative financial banks who will in due course of time rob us of our hard earned money like what they did in EU..

Please help me understand the exact role of bitcoin in daily life and how can it replace currency notes and its functioning

First one must realise that the whole world economy is at the brink of collapse.. the world governments are in debt.. the value of the paper currency is getting reduced as more and more money is being printed and put into circulation.. so the basic fact is we are earning the same amount of money but the value of that money has decreased so now we are able to buy less good for the same amount of money.. to put it in simple terms evrything is getting costlier.. once the financial markets collapse i believe cryptocurrencies will replace the fiat currencies as the dominant form of payment for goods and services.. you can already buy snacks and stuff in US with bitcoins.. as more and more merchants adopt bitcoins it will eventually replace the currency notes.. Bitcoin is anonymous and doesnt rely on the banking system but is highly volatile.. once the markets settle down and theses price fluctuations normalize we can hope to see them being used in daily life.. in India however this may take a long long time..

I hope i was able to answere the questions properly and now the newcomers have some basic knowledge about bitcoins.. i sincerely hope we Indians realise the true potential of bitcoin and start accepting them in our daily life soon.. Best of luck to all bitcoiners !!