Bitcoin is an alternative and innovative way to pay for services or goods via the web without having to have funds tunnel through traditional financial institutions or clearing houses. This allows for transactions fees to be significantly reduced. Bitcoin is simply a software application that holds a virtual wallet for purchased Bitcoins. These can be acquired through a Bitcoin exchange. Bitcoin is run by the community and is not centralized by any organization or government. The secure transactions are handled through a process called Bitcoin mining. In a nutshell, mining is the process that validates the transactions as legitimate (i.e. cryptographic hashing). Bitcoins can be used at over 100,000 different locations including popular sites such as Gyft, TigerDirect.com, and Overstock.com
In order to get started, a wallet such as Blockchain or Armory is required to store Bitcoins. Once you have established your wallet, Bitcoins can be purchased through various reputable exchange sites such as Coinbase or BitStamp. Gift cards can be purchased via Bitcoin for common stores that do not presently accept Bitcoin currency.
Bitcoin has a significant following and is growing by leaps and bounds daily. With the concept of a decentralized payment network, the power is literally with the people. Merchants are able to tap into new markets and not worry about regulations or PCI compliance. They also benefit from lower fees and fraud minimization. Although there is still a fair amount of skepticism (perhaps due to lack of knowledge in general), the Bitcoin community is a thriving crypto currency that is not going away anytime soon.
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