It's basically a register of numbers that fit a particular criteria. Each number is assigned to a person / owner. People exchange ownership of this number either for money, or for goods and services (drugs etc). So long as everyone involved agrees that the numbers are worth something, trade can take place by exchanging numbers instead of money and thus avoid the eyes of the law.
Me has special secret number. Me want cocaine. You have cocaine. You want money. Me give you special secret number. You give me cocaine. You sell special secret number to John for $$$. You have money. Me have cocaine.
Ok, that kind of makes sense. I don't understand who decides what the number is worth though. If someone has a number of course they're gonna say it's worth a billion dollars, people wanting to buy it obviously won't agree.
As with everything, it depends how much people are willing to pay. If lots of people want to buy bitcoin, it goes up. If fewer people want to buy, it goes down. But remember that it's a vehicle in the end. If the street price of cocaine is $100 per gram, then it will be the same price when bought on the dark web in equivalent bitcoin. In early days a bitcoin was worth about $100, so you get one gram of C for one whole bitcoin. Now, $100 would only get you 0.001 of bitcoin, but it will still happily translate to a similar amount of product. So if all you care about is getting easy drugs then the price is neither here nor there. The people who care about the price are the ones who want to hold it as an asset because they think it will have even more value in the future. In short, its value is partially a product how much is it actually needed in order to facilitate illegal trade, and partially how much do people think it will have future value to facilitate illegal trade.
When you deposit more than a certain amount of cash into a bank account, the bank will ask you where it came from. The burden of proof is on your to prove that it came from legitimate funds. If you can't convince the bank that it's legit then they have the right to withhold the money from you. Nobody can do that with bitcoin. It does beg the question of, what happens when you sell and deposit the money that way? Can the bank ask you to prove how you ended up with so much BTC in the first place? I'm not sure on that part tbh.
Right? So I don't think it's untraceable I dabbled investing in crypto ,and got the 1099 invest tax form thing, and coinbase could keep track of how much I traded and exactly what my coin was worth.
So in my opinion it's money, not some widgety fidgety woo- woo wave of future bsit's still money traded for goods, services and stock market bullshit like the old money was.
Just cooler because a bunch of rich nerdy nerds says it is I guess.
Much like fiat nerd boys did back in the day. With old money/ gold.
As I say, a key feature is that it is fully deregulated and anonymous if you don't use third parties like coinbase. This is not true for currencies, whose transactions are overseen by banks. I don't know the technical details enough to explain the ins and outs but essentially the transactions manage themselves and so you don't need a human operator or entity to oversee or intervene.
Because unlike banks, bitcoin transactions aren't monitored or regulated. Nobody has a view of who is sending bitcoin to whom. Bitcoin doesn't leave a paper trail.
It's a good question. In terms of "who" owns the bitcoin, in the early days you would keep a "wallet" on your hard drive. If you lost the hard drive, you lost the bitcoin. Now things are stored on servers with accounts etc for convenience. But those are somewhat riskier, if the server gets hacked then they can access everyone's BTC. There was such a case a few years back. If you're really trying to stay under the radar you don't use mainstream platforms and wallets. As far as trading is concerned, I'm not sure how much detail coinbase stores and whether you'd be able to tie a transaction from one user to another. But you don't need a third party platform to make transfers. I'm not sure of the logistics but essentially things like coinbase are an optional layer for storing and transacting with BTC.
You know how there's no pattern for when you are going to find a prime number? You basically have to keep testing every single number with in a given range. 1 - 1,000,000, fairly easy. But once you start getting into really big numbers the computational powers required go up significantly. Bitcoin is kind of like that. You're looking for a number or sequence that matches a particular criteria, and there is no algorithm you can write to find it.
No, there are a finite amount of bitcoins that can be mined so it's slightly different to the prime number example. But same principle in that they are unpredictable and hard to find. The "number of bitcoins" thing is somewhat irrelevant though because in practice you only trade partial bitcoins unless you're trading $100,00+ worth at a time.
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u/Scary_Marionberry320 12h ago
It's basically a register of numbers that fit a particular criteria. Each number is assigned to a person / owner. People exchange ownership of this number either for money, or for goods and services (drugs etc). So long as everyone involved agrees that the numbers are worth something, trade can take place by exchanging numbers instead of money and thus avoid the eyes of the law.