in Consumer Law Corporate Law Contracts Law
Asked February 06, 2014

Bitcon: The online currency

  • 1 Answer

I have heard a lot about a new form of online currency called Bitcoin whose value has increased a lot over the past year. Could you please tell me what it is and how it operates? If I invest in Bitcoin how can I spend it.

Answer 1

Default avatar
Saumya Kumar

Bitcoin is created electronically and is like a digital currency and is not printed like the regular paper currency. It can be used for electronic transactions and is created by individuals and is not controlled by any government or any international organization. The transaction is conducted between the two users without an intermediary like Banks. These transactions are verified by the network nodes and are recorded in block-chain which is a public distributed ledger. The public ledger, block-chain is maintained by a network of communicating nodes on the bitcoin software. The ledger is not managed or regulated by any government authority. You can transfer the bitcoin on the software to a person who is registered on the bitcoin software and transfer the required bitcoin to him/her with a private key assigned to you. The recipient will have to accept the bitcoin and will verify the transfer. The transaction will be verified on the block-chain to validate the transfer. The private key is something like the password of your email account. If the private key is lost the bitcoin account is lost and the bitcoin owned will be lost as well.

Agree Comment 0 Agrees over 5 years ago

Please Login or Register to Submit Answer

Directory ads
Need to talk to a lawyer?

Book a phone consultation with a top-rated lawyer on Lawfarm.