| Chrizum said: Contrary to popular belief, Bitcoin cannot be hacked. |
I am always cautious with claims like this. The basic theory of how Bitcoin works allows for 51% attack, which means anyone who owns more than half of the computing power of the Bitcoin network can manipulate the chain. For a new coin with few users that may be a real threat, but Bitcoin is pretty popular, so it seems unlikely one user or alliance of users can get enough computing power to outperform the majority of the network.
The security of Bitcoin also relies on the basic tech involved here, that is assymetric cryptography and hash algorithms. Nakamoto choose good reliable algorithms though (Elliptic Curve DSA and SHA-256 respectively), that are in wide usage outside of Bitcoin and so far no viable attacks are known.
| Chrizum said: Of course, your Bitcoin can be stolen, like anything else. But what makes owning Bitcoin so attractive to many people is that it's immutable, borderless, trustless and unconfiscatable as long as you keep your private key to yourself. |
Yes, stealing your Bitcoins means stealing your key which gives ownership of all associated coins. Similarly losing that key means basically these coins are lost forever.
| Chrizum said: On the other hand, money in your bank account can be confiscated by any authority. |
Well, same applies here as to thievery: authorities can confiscate your computer including your private key. If your private key is password-protected losing the file to authorities still means that your account is inaccessible by you.
| Chrizum said: - I hear people say Bitcoin is a pyramid scam and totally worthless because it only exists digitally and is basically 'nothing' |
That are two different statements.
Obviously Bitcoin is *not* a pyramid scam. In that case everyone would try to sell you their bitcoin for really valuable currency, but mostly the opposite happens.
Bitcoin is indeed virtual, but that is not different to classic currencies, as these days most of them are Fiat money anyways, so only exists in books/computer files. The money printed on paper or pressed in coins is for most current currencies only a stand-in for money existing in books.
That all doesn't mean that there isn't a lot of scams and fraud surrounding Bitcoin. Bitcoin has become an object of speculation like art or gold. As such the usual crop of scammers and cheats are arising to try and swindle you out of your money - be it classic currency or Bitcoin. Bitcoin traders are not regulated, and a lot of them are not very trustworthy.
