Is Bitcoin The Future of Money?

April 12, 2013

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In case you’ve not heard, Bitcoin or BTC for short, is a virtual currency that was created by a Japanese computer expert with a pseudonym name Satoshi Nakamoto in 2008.

However, there is a lot of mystery surrounding this guy and there are even rumours that bitcoin may have been created by a large corporation like Samsung, Toshiba, Nakamichi, Motorola or even a team at Google.

Bitcoin’s popularity has increased significantly over the last few months, especially after the collapse of some of Cyprus’s banks.

One of the main problems with creating a digital currency is a problem called double spending – stopping somebody from spending a chunk of text over and over again? To get around this problem, Bitcoin uses what is known as a blockchain, where users dedicate some of their CPU power to running a piece of software and get rewarded with bitcoins.

Transactions are validated by bitcoin users’ computers solving cryptographic puzzles and the first computer to solve the puzzle receives 50 new bitcoins. Bitcoins are stored in wallets that can be stored locally on a computer or virtually at somewhere like MTGox – this is considered to one of the safest bitcoin companies.

Apparently, it is extremely difficult for one computer to solve these puzzles, so would be bitcoin miners create networks of computers to solve them.

Bitcoins are not mined singularly but in blocks of 50.

Since March 2013 the price of a single bitcoin rose from $40 to $260 before crashing down to $80 in the last 3 days.

There will never be more than 21 million coins created and if adopted as a world currency each coin is projected to be worth approximately $3,571,426 – they are currently worth about $140, so could be a great investment.

Bitcoin Chart


In February 2014, MtGox, one of the largest Bitcoin exchanges folded due to a bug in their system software. This could possibly be a fatal blow to the future of Bitcoin and the value of one Bitcoin dropped from over $1100 to around $500.


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