May 11, 2019 13:45 UTC
May 11, 2019 at 19:55 UTC
Can There Be Physical Bitcoins?
Since Bitcoin is a form of digital cash, you must often have wondered how similar it really is to the various forms of cash we happen to see in our everyday lives. So, one of the primary characteristics of cash is that it exists in a physical form for us to see, touch and feel. But is that the same in the case of Bitcoin? Can there be physical Bitcoins just like we have fiat in physical form? Let’s find that out.
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How is Bitcoin Represented?
Bitcoin is represented by a typical symbol of the letter “B” having two strikes going through it, just like the the dollar sign has the letter “S” with strikethroughs.
Now, the important thing to remember about Bitcoins is that these are cryptocurrencies or cryptographically secured digital currencies that exist only on a blockchain network.
The very crux of cryptocurrencies is that these are virtual in nature and they live on the blockchain, mined and verified by nodes the decentralized ledger or blockchain is distributed amongst.
This is why Bitcoin cannot exist in a physical state. Since it was built to be decentralized, there is absolutely no central entity that exists to mint physical Bitcoins and distribute them to the people in the same way a central bank exists in any country.
For this reason, when you go to a Bitcoin ATM, you do not expect to find physical Bitcoins being dispensed from the machine just like a normal ATM churns out real cash.
Many people have tried to make physical copies of Bitcoins but we can never have a properly controlled supply of such physical Bitcoins because of the lack of centralization which is so crucial to the whole concept of Bitcoin.
The moment you have physical Bitcoins, you must make sure that those are in accordance with the actual supply and maintained in relation to the demand. For that, you need a centralized entity which is simply not possible.
Therefore, it makes sense to just have physical Bitcoin souvenirs for collectors and not actual, usable, physical Bitcoins.
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