What is Bytecoin (BCN)?

Bitcoin and most other altcoins provide better anonymity than transactions with fiat currency (for example, paying with credit cards). Still, with enough analysis, a wallet’s transactions can be tracked. This has led to the creation of Bytecoin, a cryptocurrency with anonymity as its core philosophy.

What is Bytecoin?

Bytecoin is a peer-to-peer digital cryptocurrency released in July 2012. Since then, its value has been slowly on the rise, putting it in direct competition with other leading and widely used cryptocurrencies like bitcoin and Ethereum.

Icon	Symbol	Initial release date	Algorithm type	Max. supply
	BCN	4 July 2012	CryptoNight	~184.47 billion BCN

For a long time, a more secure and anonymous cryptocurrency has been requested by the digital currency community. Bytecoin gives users that additional layer of security and anonymity by obfuscating the transaction addresses of senders and recipients of BCN.

How is Bytecoin different from bitcoin?

Bytecoin’s highest value comes from advances in the way bitcoin’s blockchain stores transactions and the public addresses of the senders and recipients. Here is the issue that Bytecoin seeks to address, along with the solution:

• The issue

Many users want to resist blockchain analysis. When one user sends cryptocoins to another, both their addresses are stored on the blockchain as part of a transaction, along with the amount of cryptocurrency sent. The blockchain’s open philosophy then presents a problem: If you know someone’s public addresses, you can track how many transactions they’re receiving and how much currency they’re getting.

• The solution

Bytecoin is the solution to this openness of transactions. By wrapping the addresses using a ring signature algorithm called CryptoNote, analysts of transactions and the blockchain would be unable to precisely pinpoint the members involved in a transaction. Because ring signatures are shared by multiple users, one would be able to discern which group of users made a transaction, but not the specific user in that group.

Where can I use BCN?

As of September 2017, some merchants and online service providers have started accepting BCN as payment alongside more common cryptocurrencies, but the vast majority of users are early adopters and traders.

How do I purchase Bytecoin?

Buying Bytecoin works like any other foreign exchange purchase: Buy BCN at a low value and sell it if it gains in value. Starting April 2017 at the low price of US$0.000174/BCN…

…it quickly rose to US$0.004179/BCN in less than two months, for an increase of 2,400% in value.

As with other altcoins and bitcoin itself, Bytecoin has since decreased in value and, as of September 2017, its value has settled at approximately US$0.0015, while the market figures out this cryptocurrency’s future.

Using Bytecoin to transfer money

Just like other altcoins, sending Bytecoin requires both you and the recipient of BCN to own a Bytecoin wallet. Once you have the wallet installed, sending BCN is the same as other altcoins because the algorithm for anonymity works behind the scenes.

1. Install a Bytecoin wallet. Some wallets allow users to send and receive multiple cryptocurrencies but, as of October 2017, only Bytecoin’s official wallet lets you send and receive Bytecoin tokens.
2. Get the recipient’s address. The recipient must provide you with an address, usually a series of letters and numbers, which you then enter into the Bytecoin wallet.
3. Send agreed-upon BCN amount. After verifying that you have the necessary funds, enter the amount of BCN previously agreed upon with the recipient and send the coins. The transaction will show up immediately, but it might take a couple of minutes until the transaction is verified by a miner on the blockchain, which unlocks the funds for use by the recipient.

How to get Bytecoin

• Get paid in BCN

There are already many users holding BCN in their wallets and willing to use it to pay for products and services online. Whether you’re a website developer or a marketing consultant, accepting BCN as payment alongside other cryptocurrencies and fiat currencies like USD costs nothing and gives customers the ability to pay using their preferred method. These Bytecoin assets can then be converted back to fiat currency in online exchanges.

What to watch out for

Bytecoin is still young in September 2017, and its value is still undecided. Traders will need to decide whether purchasing Bytecoin is riskier than buying other, more stabilised cryptocurrencies.

What’s next for Bytecoin?

Bytecoin’s roadmap for the future is clear. While work on the anonymity of the cryptocurrency remains at the forefront of the development team’s priorities, Bytecoin aims to introduce more features in the future, including a more lightweight wallet (for smartphones, for example) and a scripting language that allows users to create smart contracts.

These promised future developments will likely help Bytecoin achieve a stronger foothold in the cryptocurrency market.

Frequently asked questions

• Is the anonymity in Bytecoin automatic?

  Yes. As with other coins, receiving and sending BCN is simple, easy and fast. Bytecoin wallets handle the anonymity algorithm behind the scenes without any input from the user.

• How long does verifying a transaction take?

  Transactions are created instantaneously, but until a miner verifies the transaction, builds a block of transactions, and then broadcasts that block, the funds will remain unusable. This process takes approximately 2 minutes, as opposed to the 10 minutes needed by bitcoin.

Image sources: Shutterstock, CoinMarketCap