- David Pieper has been busy studying the stock market since the late 90s. As early as during his business studies at university and later during a career as an investment analyst at a bank, he combined fundamental analysis with the benefits of technical analysis. Mr Pieper focuses on trading CFDs and works as a freelance writer in the field of technical analysis.
Some people compare the current hype with the historical tulip bubble, some people talk about a new currency age – the topic is the virtual currency called Bitcoin. This article shows the advantages of Bitcoins, how they work and what perspective Bitcoins have in the future.
Decentralised, Unregulated and Anonymous
The concept of Bitcoin was introduced publicly for the first time by Satoshi Nakamoto in 2008 – a time when the global financial world was on the edge. Since then our existing monetary system has been faced with a deepening crisis of confidence and therefore the call for an alternative has become louder.One alternative might be Bitcoins. But what are Bitcoins? It is a virtual currency that consists of cryptographically coded data that is forgery-proof. Bitcoins enable the direct transfer from one user to the other and render intermediates like commercial banks and central banks redundant. Instead of a central third party – the central bank or commercial bank – you have a global P2P (Peer-to-Peer) network, where every user takes care of the control of the currency system. The decentralised structure avoids having single powerful players using the system in their favour or manipulating it. A major advantage of Bitcoins in contrast to the current monetary system is anonymity and cheap transaction costs.
Money Creation in a Different Way
Bitcoins are not issued by a central institution but have to be created. All users within the network can take part. » Decentralised, Unregulated and Anonymous The concept of Bitcoin was introduced publicly for the first time by Satoshi Nakamoto in 2008 – a time when the global financial world was on the edge. Since then our existing monetary system has been faced with a deepening crisis of confidence and therefore the call for an alternative has become louder. insights 21 But it only makes sense if you have a high-performance computer because they earn Bitcoins for the resolution of a highly-complex arithmetic problem. The “Mining”, the money creation, is organised in a way that you need more performance power with time to create additional units of money – it is similar to the production of natural resources. The network creates about 25 new Bitcoins in ten minutes at the moment. In contrast to the current monetary system, where the big central banks try to out do each other by money printing, the Bitcoin money supply is limited from the beginning – to 21 million units which guarantees monetary stability Bitcoin supporters say.
Editors’ Picks
EUR/USD stays in positive territory above 1.0850 after US data
EUR/USD clings to modest daily gains above 1.0850 in the second half of the day on Friday. The improving risk mood makes it difficult for the US Dollar to hold its ground after PCE inflation data, helping the pair edge higher ahead of the weekend.
GBP/USD stabilizes above 1.2850 as risk mood improves
GBP/USD maintains recovery momentum and fluctuates above 1.2850 in the American session on Friday. The positive shift seen in risk mood doesn't allow the US Dollar to preserve its strength and supports the pair.
Gold rebounds above $2,380 as US yields stretch lower
Following a quiet European session, Gold gathers bullish momentum and trades decisively higher on the day above $2,380. The benchmark 10-year US Treasury bond yield loses more than 1% on the day after US PCE inflation data, fuelling XAU/USD's upside.
Avalanche price sets for a rally following retest of key support level
Avalanche (AVAX) price bounced off the $26.34 support level to trade at $27.95 as of Friday. Growing on-chain development activity indicates a potential bullish move in the coming days.
The election, Trump's Dollar policy, and the future of the Yen
After an assassination attempt on former President Donald Trump and drop out of President Biden, Kamala Harris has been endorsed as the Democratic candidate to compete against Trump in the upcoming November US presidential election.
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