Today more Subways have followed, and businesses big and small have begun accepting cryptocurrencies as payment for a whole host of goods and services, including Expedia, Microsoft, Overstock and Virgin Galactic, among others.
Cryptocurrencies are no longer just an adventurous and futuristic investment opportunity; they are rapidly becoming an alternative payment method for everyday goods and services. The convenience of receiving payments within seconds, with minimal transaction fees means a lot to a business. More online stores are opening up to accepting cryptocurrencies as a form of payment from their customers.
But while cryptocurrencies like BTC have hit the headlines a lot recently thanks to its price volatility , there are a number of compelling reasons why small businesses should explore offering it alongside more conventional payments.
What's the Big Deal About Bitcoin?
One big area that cryptocurrencies can help merchants with is security. According to Identity Theft Resource, data breaches in for companies holding private data for customers hit their highest levels since records began.
Their banking information is stored on their wallet, and not on a potentially vulnerable company server. When the blockchain is downloaded and maintained on a computer, it is referred to as a "node".
Behind the Bitcoin
Those running a "node" have a copy of the blockchain. This copy is actively updated along with every copy on every other node. The blockchain is maintained collaboratively and does not have a single central entity maintaining the ledger.
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Edits can only be made to the blockchain with general consensus among the individuals running the nodes. When consensus is reached, new data is added to the blockchain.
Therefore, all participants are recording the agreed upon changes to the blockchain. Data on the blockchain is made secure through the creation of hashes, hexadecimal numbers that are created using all the data from the blockchain each time a new block is created. Hexadecimal what?
For now, just know that hexadecimal is a base 16 number system - we are much more familiar with the base 10 number system and some may be familiar with base 2 also known as binary. Hexadecimal numbers look like this: BF35 48, in base Putting data into hexadecimal hashes allows for a high density of information to be encrypted in a consistent format, typically in a hash of a fixed length.
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This allows for large amounts of data making up the blockchain to be written to a fixed length hash. As the blockchain grows bigger, the number of characters in the hash will always be the same length the characters themselves change. This is part of a set of rules that makes the blockchain secure - any change to the blockchain will cause a change in the resulting hash, and alert us that the state of the blockchain has changed.
What is the next big thing in the crypto world?
Use cases for the blockchain are now rampant: information about an individual's identity can be stored on the blockchain, banks can record transactions using blockchains, and copyright licenses can be issued via this transparent framework. Any scenario where a ledger is used to keep records may benefit from blockchain technology.
The blockchain is engineered to be open to anyone who has a computer terminal and decentralized so there is no single decision-making authority. No central authority holds power to make decisions and enforce rules. An issue with a system that is open and decentralized is that careful consideration must be given to incentivize individuals to not only participate, but behave in a manner that is not detrimental to other users. Digital currency can be thought of as a tool that enables people in different regions and countries to trade with each other without worrying about an exchange rate or transfer fee from one banking system to another.
The excitement we have seen around cryptocurrencies comes from their potential to enable easier exchange of value from an entity to any other entity. More individuals would have the opportunity to buy or sell anything from theoretically anyone from nearly anywhere, as long as they have an internet connection.
Ethereum is an open source, programmable blockchain platform that allows for the development of decentralized applications or DApps - sometimes stylized as dApps. The Litecoin network is scheduled to produce 84 million currency units.
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Or maybe you could go with Primecoin , an. Primecoin's proof-of-work is an innovative design based on searching for prime number chains, providing potential scientific value in addition to minting and security for the network. In that case, perhaps Peercoin is for you. With this system, coins are generated based on proof-of-stake blocks in addition to proof-of-work blocks. This little tour of crypto-currencies and there's plenty more should be enough to convince you that one of these outfits will probably produce a currency that is widely seen as superior to Bitcoin along most dimensions, perhaps attracting lots of supporters on websites and Russian-government-sponsored TV shows.
What happens then to your Bitcoins then? History is littered with currencies that failed and are no longer used, such as the German Mark during the Weimar Republic and, more recently, the Zimbabwean dollar.
Although previous currency failures were typically due to hyperinflation of a kind that Bitcoin makes impossible, there is always potential for technical failures, competing currencies, political issues and so on. Or taking a punt on Pets.
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