As an internet user you should be familiar with the open source term. Open source OS, office tools, graphic software or utility software.
Open source as a development model promotes:
- Universal access via free license to a product’s design or blueprint
- Universal redistribution of that design or blueprint, including subsequent improvements to it by anyone
Satoshi Nakamoto an anonymous internet user or group of users thought to apply a decentralized financial institution where anyone could join the community and be a part of a new open source money issuing system, not related or controlled by any legal or government. Funny!
Using a traditional Peer 2 Peer network and complex encryption techniques each connected client is now part of the new issuing system and in reverse he will receive his reward in bitcoin credits.
But How bitcoin get its value?
To answer this point we may raise another question why 1$ USD has a value? and the simple answer is 1$ USD is valuable cause you may exchange it with resources like a candy, gum or a small cupcake!
It’s valuable because your are quite sure that the candy shop guy will be interested to exchange his owned candy with your 1$ USD, the candy guy will exchange his candies because he is also sure that the coffee shop owner will be interested to exchange one of his hot espresso with his new collected 1$ USD.
It’s all a bout trust, where all the traders trusts that the US government will back its issued money with resources to keep it’s value along the way.
In bitcoin world, where users participate with their computing power to collect the new digital coins, and because it’s a long process and it takes time users value the collected bitcoins and start looking for alternatives to collect bitcoins faster. May be they offer their advanced services is exchange of bitcoins rather than coins and it might be also cheaper or bundled with some promotional offers.
New attracted users will keep looking for bitcoins to benefit the price difference and the offers as well! This will soon create a cycle and community who value this digital currency and as much the community grows the bitcoin value grows in response.
Back to our previous 1$ USD and imagine that you are lost in a desert between a group of people, and you had the last and only cupcake which will give you an extra 5 life days with a wise consumption. Will you trade your life-cupcake with 1$, 10$, 20$ or a Million USD!
That’s why bitcoin has a value!