What is the difference between the virtual currency and Bitcoin introduced in the previous example? Actually, the reason why it exists is completely different.
Virtual currency that can be used only within a specific game or website is created on a company-by-company basis. I have a goal.
Bitcoin, on the other hand, is a virtual currency intended to help all economic activities on the planet, such as dollars and yen which are universally operated
Bitcoin is designed to be “useful” in everyday life around the world. Since it is a virtual currency, there are no banknotes or coins, but it is designed so that you can buy and sell goods by using your PC or smartphone as a wallet instead.
Although it is still in the developing stage, it is a virtual currency created with the aim of becoming a next-generation currency that is more convenient, stable, and usable all over the world than the yen and dollar.
Bitcoin and electronic money
What is electronic money?
There is electronic money as a concept similar to virtual currency. It is a word that often appears in describing Bitcoin. If you confuse these, it will hinder your understanding, so please keep them in order.
Electronic money is a means to realize electronic payment (by exchanging data) without using banknotes and coins. There are types that perform online payments, and there are contactless payment methods that are becoming the mainstay these days. It is used when you take a train or pay at a convenience store.
It is a mechanism that is already permeating into everyday life, so I think that many people have actually used it. It’s very convenient because you don’t have to take your coins out of your wallet.
Bitcoin also has the feature that it can be used as electronic money. In the first place, Bitcoin is a virtual currency that does not have banknotes and coins, so it is natural that it can be used as electronic money.
Then is bitcoin electronic money?
Electronic money, which is commonly used today, basically exists for making electronic payments using the currency used in the area. Bitcoin trading is one of the popular ways to make money online. For more detail Register for bitcoin account.
In the case of Japan, for example, electronic money will be used instead of yen bills and coins to make yen payments more convenient. Therefore, the user will have to deposit the yen he owns to the electronic money terminal or put the money in the bank account used when making payment with electronic money.
Although payments are made electronically without using banknotes or coins, the reality is that we are exchanging the yen currency.
Bitcoin is not about charging a yen to any terminal.
When purchasing products using Bitcoin, you must first exchange the currency of the yen you have with the currency of Bitcoin. Only when you exchange yen for Bitcoin, you can execute payment with Bitcoin.
The flow of payment after exchanging money is the same as for general electronic money. At shops that accept payments in Bitcoin, you can make payments in Bitcoin electronically. Then, the bit coins you own will decrease and the bit coins you own will increase.
Bitcoin is a currency. It is a currency, unlike the yen and the dollar, although it is virtual. Electronic money is a mechanism that allows payment without using money. Virtual currency is not electronic money.
Who manages Bitcoin?
I said it is a currency that is not controlled by the nation or companies, but who then issues Bitcoin and manages the distribution?
From a common sense point of view, it is only a mass of risk, such as a currency that no one controls. If someone can arbitrarily issue a large amount of currency and become rich in that currency, the credit of the currency will be lost. Such unstable currencies do not circulate and no one finds value.
Bitcoin does not have a central control, but instead uses a network of computers to control the currency.
This visualized record helps prevent currency forgery and double payments. All records remain, but they do not contain any personal information. Records exist solely to ensure the integrity of Bitcoin distribution.
