Question

Please answer each with 4-5 sentences.

Q8a. What is BitCoin? Who created BitCoin?

Q8b. How do acquire BitCoin?

Q8c. Can you use BitCoin to buy things?

Q8d. Can BitCoin be taxed?

Q8e. During the last year, BitCoin’s value went from $5000 to $20,000 in days and back down to $1200. Why is it so volatile?

Q8f. Are there any other cybercurrencies? If yes, name them.

Q9.   Read up on blockchain.

https://blockgeeks.com/guides/what-is-blockchain-technology/

There are other websites and videos explaining blockchain.

Q9a. Try to explain blockchain in 2-3 paragraphs.

Q9b. How is blockchain used in cryptocurrency?

Q9c. Give one example of how blockchain in used in business.

Q9d. Give ANOTHER example of how blockchain in used in business.

Answer 1

Q8a. What is BitCoin? Who created BitCoin?
A: Bitcoin is a cryptocurrency(digital currency). It's is a form of electronic money or internet currency. It is decentralized that means it cannot be administered by any bank or administrator. It can be sent P2P (peer-to-peer) from user to user on bitcoin network with any intermediaries. The transactions are verified by a network and set of computers via a technology known as blockchain.
Bitcoins are created by an unknown person with the name SATOSHI NAKAMOTO and was released online as open-source software in 2009.

Q8b. How do acquire BitCoin?
A: There are few ways to acquire Bitcoins but the two most notable are:
1. Buy: You can buy bitcoins for the companies providing bitcoins legally or you can do a peer-to-peer transfer and get it from another user. For this, you need a bitcoin digital wallet.
2. Mine: Minning is a word given to verify and secure bitcoin transactions. It is a peer-to-peer computer process to verify transactions using computer processors and graphics card. A group of transactions is called block and you get a particular amount of bitcoins upon completing a block.

Q8c. Can you use BitCoin to buy things?
A: Since bitcoin is a digital currency and is illegal in many countries, so you can rarely find a physical store that accepts bitcoins but you can use bitcoins on various websites like Microsoft and others. Even some retailers give you an option to buy a gift card from bitcoins and then use it. Since tracking for bitcoins is really hard, so its mostly used in illegal trade and the black market.

Q8d. Can BitCoin be taxed?
A: Few countries consider bitcoins as a property like stocks and real estate, so you will need to pay tax if you have a capital gain and you can lower the tax if you have taken a loss. But since it really hard to track bitcoins and the transactions are anonymous so it becomes nearly impossible to tax but with the new technology coming in the market, some companies are claiming that they can track and hence it is not too far for law enforcement to track your illegal earnings.

Chegg has suggested us to do the first 4 parts per question. Please keep in mind to post a question in parts of 4 in the future and also re-post this question again, 4 questions per part.

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