Keep an Eye on Bitcoins
Bitcoin is a decentralized (i.e., no single country or organization controls it) digital currency. It was introduced in 2009 by an anonymous hacker, and over the last couple of years it is gathering a lot of interest. In fact if you check Google Trends for the term you’ll notice a huge spike taking place at this very moment in time.
The big advantage of bitcoin is that, since you can transfer money without going through a central organization or middlemen, transactions can be anonymous and free or change. Additionally since there’s no country issuing or backing the money the currency is not subject to monetary policy, country-based inflation and so on.
The downside is the security aspect. For one thing not having a country to back the currency up makes it a riskier investment. Second, given that the currency is completely digital it’s more susceptible to attacks and frauds.
If you want to read more about it, check out the Wikipedia entry.
That all being said, what I find interesting about bitcoin is that we are at the very beginning of the phenomenon, and no one knows for sure where it’s going.
Sure, there’s a chance it will flop and die within a couple of years, but there’s also a chance that it will revolutionize money as we know it. And if this happens there will be a lot of opportunities for companies and people, especially if you move early on.
In other words, I think it’s early to take a stand (i.e., don’t rush out to purchase as many bitcoins as you can, as some people are doing), but it’s the right time to start monitoring the developments. After all it’s not every day that something appears with the potential to drastically change the world.
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9 Responses to “Keep an Eye on Bitcoins”
Virtual or digital currency like Bitcoin sounds like a good idea but in practice it is really volatile. Of course this does not mean it will fail but I will wait for a while to see what happens especially with regards to safeguards.
This is totally new for me. Bitcoins… even the name is kind of weird. But I don’t see how this digital currency can change the way we are running our online businesses and as someone cited on the comments… there are always pros and cons about something that is new.
I really dont understand why anyone would invest their money which is going to be just virtually present on the web,
secondly i just visited their website and they are already saying that you will yourself have to keep it safe online.
thirdly if something or the other goes wrong with there systems/servers, how is that our investment is safe.
But over all the point is virtual currency, and i am glad that we are moving forward.
This is the first time I heard about bitcoins. But as usual everything is both negative and positive. But this article is interesting, thanks Daniel!
I first heard of bitcoins by one of my friend’s friend. At first, I wasn’t convinced if there is anything like this that could allow us to use single digital currency. But, as of today I’m still not in a position to put my money into it as no country is backing the currency.
I find it interesting too but perhaps I’m not convinced yet to spend money in it. When I first heard it, I thought the idea would die quickly but now it seems to be trending stronger than ever.
Wish if every country can use bitcoin 1 day as a single currency..
I’ve adopted the Bitcoin since few years because i love the idea behind it. But i’m just disguted how the bitcoin is used for speculation purpose. With the drop to 80 $ for a bitcoin, i see many people who trie to launch their own virtual currency, so i think that the Bitcoin will not be the currency of future, but he has open the path for changing the current financial system.
Good post Daniel,
I think bitcoin has some real potential in an alternative to wire transfers but I don’t understand it nor am I comfortable with the idea that it was started by ?anonymous? who for all we know could be the exact same wall street banksers.
With the recent drop in price and the freezing of the market I don’t think I would trust it more than dollars definitely not more than precious metal. People paying more money for a bit coin than an ounce of silver or gold are asking for it.
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