The most trending news all over UAE is, VAT followed by Bitcoin. Bitcoin is not a new term, everyone is hearing it quite often these days but most of us are not having a clear picture of what it is and how does it work?
What is a Bitcoin?
Bitcoin is the first cryptocurrency.
Now here comes the question, What is cryptocurrency?
Well, Cryptocurrency is similar to the digital currency. Unlike digital currency, the transaction details are totally unknown to third party i.e the identity of the sender and the receiver is not known. This uses the blockchain technology.
So bitcoin is one of the cryptocurrencies where the cost of coin keeps fluctuating. This is the first cryptocurrency introduced. Even though many other cryptocurrencies like Ethereum, Litecoin, Ripple, and few more are being introduced, Bitcoin is maintaining the top place and running successfully. Other than hiding the transaction details like amount transferred, the identity of the sender and the receiver, bitcoin is a type of investment for many people. The coin value keeps changing each and every second.
Who founded bitcoin and the growth?
Bitcoin founder is still unknown to the world. It was founded in early 2009 by an anonymous person Satoshi Nakamoto. Many claim him to be a Japanese by his name. During its early days, bitcoin was available for a very low price. Till 2011 a bitcoin value was lesser than a $1. In early 2013, there was a drastic rise in the bitcoin value by 200%. Currently, one bitcoin value is more than $14,000.
Is it legitimate?
Even though it is still not clear whether bitcoin is a legal currency like dirhams, dollars etc. The UAE government did not state it as a legal currency. There is a huge demand for this all over the world. Experts suggest that the popularity and demand bitcoin has, shall not remain for so long which is terrifying the investors. The demand shall drop if the officials of any particular country will state bitcoin as illegal and ban the usage of bitcoins in their respective country.
How to buy a bitcoin?
Many people say that there are ATMs in Dubai for purchasing or selling a bitcoin. Which is wrong. Currently, there are no ATMs or any outlets where one can buy/sell a bitcoin legally.
There are few websites which work for bitcoin transactions. This is a preferable way to purchase/sell a bitcoin. The buy and sell rates on a bitcoin are not same.
There are some fees associated with a bitcoin transaction. A bitcoin purchase/sale includes some fees like trade fees and transaction fees.
Trade fees are the fees charged on the currency exchange i.e local currency is converted to the cryptocurrency and vice versa.
Transaction fees are charged on performing a transaction i.e each time you buy/sell a bitcoin there are some transaction charges included which depends on the website you are purchasing your bitcoin.
Some fascinating facts about bitcoins
-
- There was a time when some anonymous guys bought pizza for 10,000 bitcoins in early 2009 which is worth of 6 billion AED now.
- There was a time when some anonymous guys bought pizza for 10,000 bitcoins in early 2009 which is worth of 6 billion AED now.
-
- Winklevoss twins are billionaires now who bought 90+ bitcoins for $120 each in 2013.
- Winklevoss twins are billionaires now who bought 90+ bitcoins for $120 each in 2013.
- In 2009 a man bought bitcoins in a drunk state for less than 20 pounds and now a billionaire.
There are many other stories like this. By the end of 2017, bitcoin was the top cryptocurrency making billions of income. Bitcoin is one the best and easy investment yet there are many risks involved with it.
Dubai’s official cryptocurrency- emCash
Even though the concept of cryptocurrency is a bit useful but the current cryptocurrencies are not legalized by the government. Keeping this in mind, Dubai government has announced its official cryptocurrency-emCash. emCash works as both digital currency and cryptocurrency.
Due to the higher rates and risks involved with bitcoin, other cryptocurrencies are equally performing well in the market. On the whole, the demand and usage for the cryptocurrencies are rising high. But experts suggest that cryptocurrency may not be a genuine investment and this crypto bubble may burst anytime. So the investors have to be careful before putting your money in such fundings.
About the author
Nikitha is a Senior Analyst at MyMoneySouq.com. She has been writing about personal finance, credit cards, mortgage, and other personal finance products in the UAE. Her work on Mortgage loans has been featured by the GulfNews and other popular Financial Blogs in the UAE.
