Bitcoin is an entirely virtual currency that has the ability to transcend national borders and online payment portals, such as PayPal, like no other currency can. Last year $150 million could have bought you every single Bitcoin in circulation. Today the world’s supply of Bitcoin is worth an estimated $10 billion (Foley 1). As the coins value grew, so has the conflict between those content with the current financial system, and those who aren’t. In the battle for the future of the global financial system there are two teams. the banks are facing off against libertarian businessmen and technologists. I’m with the technologists; I think Bitcoin will become an even bigger part of the financial system.
Bitcoin separates itself from traditional financial systems with the system it uses to verify the transactions. In order to verify users transactions, every transfer of Bitcoin gets added to the block chain. When funds are sent to another Bitcoin user, the transaction is blocked together with other recent Bitcoin transactions and then locked with a complex mathematical equation. The unverified transactions sit then sit in escrow while high performance computers, called nodes or miners, work to solve the equation locking the group of transactions. Once the equation is solved the transactions are released from escrow as verified transactions, the miner who successfully solves the equation gets a 25 bitcoin reward, and the solved block of transactions is added to the block chain, a virtual history book of every bitcoin transaction that ever took place (Bryans 447). For supporters of the coin this means you can completely avoid the world’s banking system, currency exchanges buying goods around the world, and online escrow service...
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People's Bank of China. The People's Bank of China, 3 Dec. 2013. Web. 2 Apr. 2014.
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Yuzhe, Zhang, and Li Xiaoxiao. "PBOC Rule Means Bitcoin Websites in China Must Close, Expert Says."
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Wiley, Robe. "Warren Buffet:'stay away from Bitcoin it's a mirage." Business insider. N.p., 14 Mar.
2014. Web. 5 Apr. 2014. warren-buffett-bitcoin-is-a-mirage-2014-3>. McMillan, Robert. "The Inside Story of Mt.Gox, Bitcoins $450,000 disaster." Wired. Wired, 3 Mar.
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Many would say that Bitcoin is a revolutionary new currency, in fact, it is the first currency of its type. It is completely decentralized from governments, it is created as a payment for computer processing power and recording payments into a public ledger. This process is called “mining”. It allows users to process economic activity of the Bitcoin currency, when the currency’s transactions are processed, the computer that processed the transaction gets a tiny reward for its processing power. This is how new Bitcoins are created. To claim the reward, a special transaction called a coinbase is included in the processed payments, all Bitcoins in existence can be traced back to their original coinbase transaction. Right now the reward for adding a block is 25 Bitcoins, that number will be halved in 2017 to 12.5, and then will be halved again every 4 years. Eventually there will be no reward other than the transaction fee, this will occur around the year 2140. Payers have a large incentive to include a transaction fee because then their transaction is usually processed by other users more quickly. People processing have the option to choose whether to process transactions that include a transaction fee or just the standard reward. This is just a small outline of how Bitcoins work.
Jacobs, Edwin. "Bitcoin : A Bit Too Far?." Journal Of Internet Banking & Commerce 16.2
Brustein, Joshua. "If Bitcoin Remains Impractical, Treasury Will Let It Be." Bloomberg Business Week. Bloomberg, 18 Mar. 2014. Web. 22 Apr. 2014.
Bitcoin has been compared to the internet of the early 90’s by many people in that it has the potential to become a huge global peer to peer payment system allowing people to exchange currency value over the internet without a 3rd party bank. Much like the internet in its infancy was the basis for global commerce, Bitcoin has the potential to become a huge global payment network that operates outside of banks and government control.
Zetter, Kim. "FBI Fears Bitcoin's Popularity with Criminals." Wired. Conde Nast, 9 May 2012. Web. 2 Apr. 2014.
The documentary Banking on Bitcoin from director Chris Cannucciari was a documentary released in 2016. Throughout this documentary Cannucciari asserts that the cryptocurrency Bitcoin is the future. Using Bitcoin experts and enthusiasts, this documentary is working to persuade people that Bitcoins peer to peer non-centralized system is the future and should be used over traditional banking methods. The targeted audience for this documentary is businesses, government officials, and anyone interested in the Bitcoin technology. The tone of this documentary is ardent while also informative.
“The Economist Explains, How Does Bitcoin Work?” The Economist (2013): n. pag. Web. 08 Apr. 2014.
The article ‘Minting Pure Reason’ written by Jyotirmoy Bhattacharya concentrates on the mechanism of bitcoins, security concerns while trading using bitcoins and pros and cons of using bitcoins as a currency. The author also questions whether bitcoins, in future can replace actual currencies (referred to as ‘little pieces of coloured paper’ in the article).
On the other hand, there is the element of widespread profit from the market of the electronic currency. The ones who [participate...
Bitcoin is a digital currency, similar to cash due to the fact it is instant, however, is not managed or controlled by a central government or organization. Instead, the network is run on thousands of independent user’s computers. None of these computers have more control over the network than any other computer. The network that Bitcoin was founded upon is based on 40 years of research in cryptography and over 20 years of research in cryptocurrencies; by thousands of researches around the world.
...global organizations, demographics and communities are responsible for the large success of the many crypto-currencies on the digital market today. From my discovery of crypto-currencies in late 2013, I have discovered a major trade community with the international population. The crypto-currencies are growing largely in size and popularity. I am concerned over the stability of crypto-currencies - many of types currencies have suffered major capital loss, decrease of market cap, theft, illegal trade etc.. These certain currencies could be a hazardous to deal with in the future. I believe trade and transaction of crypto-currencies should be encouraged on a local, national and global level. Although they have suffered major setbacks in the global economy, I maintain that crypto-currencies have a positive future and that they will undoubtedly affect the worlds economy.
Cryptocurrency, such as Bitcoin, has brought in a lot of media attention over the past few months and has been raising eyebrows within government agencies worldwide. Here’s why: Appropriately constructed, cryptocurrency could potentially upend our established global economic system. This newfound technology poses as a serious threat to our currency-issuing central banks and also to the global financial intermediaries. To truly understand the changes that cryptocurrency could potentially bring, you will need to have a general understanding of our current economic system.
Smith, Craig, "Tough New Rules Don't Faze Chinese Internet Start-Ups," The New York Times, 4 October 2000. Retrieved 26 April 2004.
The invention of money is perhaps one of the greatest achievements of human civilization. From the very beginning of society, people have used money to circumvent the difficulties of bartering and to foster trade and commerce. Since then, money has come a long way. No longer do we need to rely on silver coins, cocoa beans, or even anything of intrinsic value to conduct our business; today, we use paper currency, which is convenient and easy to carry around. But slowly, we are moving into the digital age of money, an age in which less of our money is actually tangible and more of it is just data on a computer server. To some, this prospect may seem daunting. However, given the major advantages of electronic money over outmoded paper counterpart, society as a whole should embrace the upcoming era of digital money.
A cryptocurrency is a means of currency exchange which is designed around securely transferring information, through the process of encryption. Encryption is a way of encoding messages or information in way that only specific or authorized parties can interpret. Fundamentally, cryptocurrencies are an alternative to centrally governed currencies, this virtual currency seeks to incorporate principles of cryptography to implement a secure, distributed, decentralized information system 1. There are various types of cryptocurrency being used on the virtual market today that will be discussed throughout this report.