Bitcoin vs Forex Trading
by James Freeman
The foreign exchange or Forex market is the world's largest financial market. The Forex market plays a vital role in the global economy. Everyday trillions of dollars are being traded from one currency to another. Currency exchange is essential for international commerce and the global Forex market makes this happen. Forex market participants include governments businesses and of course Investors.
There is no company or central bank controlling Bitcoin, so it cannot be inflated like the dollar. In fact, the embedded code has been predetermined so that no more than twenty-one million Bitcoins will ever be in circulation. To make sure that the distribution is at a steady rate, Bitcoin production is modelled after gold-mining just like mining for gold grows increasingly difficult overtime so does creating new Bitcoins.
The sheer size of the Forex market means it can persuade other asset classes such as bonds, stocks and commodities. One change in the Forex market can have an undulate effect across several markets. The Forex market can influence other asset classes because the Forex market is the world's largest financial market. It also sets the base for how other asset classes perform. The Forex markets widespread authority may appeal to investors who are interested in global money matters.
Businesses can participate in the Forex market in order to facilitate international trade. Businesses need the Forex market to trade payments for services and goods bought overseas or to exchange payments from international customers into their preferred currency. Advanced investors use the Forex market to contemplate on the recent changes in currency prices. Currency values vary almost constantly during the week for the reason that the Forex market is open 24 hours a day apart from weekends. During the week the Trade market has to be open around the clock because of the global nature of the economic system. The trade investors profit when they purchase a currency and its price increases. Investors can also sell or short of currency in anticipation of a price decrease.
Bitcoin is digital money used directly between people anywhere in the world to buy online goods and services.
To get started you need to download the Bitcoin wallet. Like a real wallet, it stores your Bitcoins and is used to remit and accept payments using unique addresses. Anytime a transaction is made between the Bitcoin users, it gets recorded on a publicly shared log called the block chain. All of these transactions are checked and confirmed by miners. Miners are basically people with potent computers that use Bitcoin software to verify that transactions are correct. Thanks to the splendid work done by the miners and Bitcoins large network, no coin can be reproduced or double spent.
Cryptography is used to make it impossible for anyone to spend funds from any another user's wallet and could be used to encrypt all it so that it can't be used without password. This type of protection is also ensured for electronic bank transfers and credit card transactions.
Right now 25 Bitcoins are produced every 10 minutes. This pace will be halved every four years until the final Bitcoins are created, in 2140. No central bank can add trillions more to the system for their own advantage and destroy its value. One way to get Bitcoins is by mining them. But since that require specialized equipment and time, most of us buy them. Several exchanges exist online where you can buy Bitcoins and cash out your Bitcoins for major currencies.
There are currently 50,000 Bitcoin transactions per day. Over a thousand online stores accept them as payment. The Bitcoin market has exploded from fifty million dollars to 1.2 billion in only a year and these numbers are growing.
Author: James Freeman
Technical Analyst at thebitcoinbanc.com.