Bitcoin Advantages

Bitcoin has several advantages compared to traditional money transmitting services. We already mentioned two of these above, the elimination of the need for third parties and the bypassing of restrictions. Another major plus of the new cryptocurrency is the very low cost for sending and receiving bitcoins. While it is possible to send transactions completely free of charge, it is recommended to pay the small fee in order to speed up the sending process.

The fee amount depends on the data size of the transaction. A typical transaction is 500 bytes and carries a fee of 0.0001 BTC. At current prices of $250 per bitcoin, this amounts to a charge of 2.50 cents. Because the fee is completely dependent on a transaction‟s data size and not on the number of bitcoins being sent, a $10 transfer will carry the same fee as a $10 Million transfer. The fee will take a 0.25% piece of a $10 transfer but that same fee will only take 0.00000025% of a 10 Million transfer.

Bitcoin offers benefits to merchants as well, as transactions that involve the digital currency are secure and irreversible. Without the risk of fraud or fraudulent chargebacks, merchants can offer their products at a discount thereby generating more sales or pocket the difference themselves. In addition, with card processors out of the picture, merchants can save on the percentage cut taken by Visa / MasterCard.

Notice that there is no name that goes along with the bitcoin address. This is what outside observers mean when they say „‟ Bitcoin is anonymous‟‟. Bitcoin is in fact „‟pseudo anonymous‟‟. While all bitcoin addresses and transactions are public, the holders of those addresses remain hidden.

The only thing that can be discerned by looking at the block chain is that address 1XXxxxXXXxxxxxxXX sent 100 Bitcoins to address 3XXxxxXXXxxXXxxXX at a certain time. Who sent the coins, the reason for sending, and the users location is not revealed.

However, keep in mind that as soon as you connect your bitcoin address to your real identity (for example, by purchasing bitcoins online or in a face to face meeting), the pseudo anonymity provided by bitcoin is lost.

Source of Information : Bitcoin Automated Trading Guide

Bitcoin Advantages