How Do Bitcoin and All Alt-Coins Work

Bitcoin and all altcoins are cryptocurrencies but not exactly a currency. Legally it’s looked upon as an asset like a stock and may be exchanged for money. It can also be used to pay goods and services like money but is looked at as more of a barter.

Bitcoin has been increasing in popularity the last few years and has applied for SEC approval (which would have given it the status as a currency), only to get rejected. The day the SEC approves Bitcoin will be the day it is recognized as a legitimate currency.

Bitcoin has absolutely zero backing other than what users deem this digital “currency” to be worth. Truth of the matter is that the US Dollar, which used to be based on the gold standard, has long since shifted to a debt-based model.

Bitcoin operates is through a centralized database called a Blockchain. All alt-currencies have followed a similar model. To explain it more, view the video below.