Following the uncertainty of the current world and its unstable economy where currencies face great flux every day, a new economy was introduced under the alias Satoshi Nakamoto. Under the worlds infinite disarray, Bitcoin emerged as a decentralized and a digital cash system with regulated by almost no one.
This peer-to-peer networking system runs through electronic signatures and crypto graphics to generate currency- Bitcoins. Bitcoins are not only a form of currency but also a form of investment for some investors who keep these coins in hopes of an increase in their value and enjoy the opportunity cost.
Just like normal everyday cash, this currency doesn’t have to be printed and issued by the federals or the central banks. Bitcoins are generated through a process called ‘mining’. These coins are mined out of the system by giving complex and advanced mathematical problems for your computer to solve. The target is to generate a 64-digit number as an answer to that puzzle. When a system solves the given complex algorithm, it obtains a specific fraction of Bitcoins every time.
The bitcoin network automatically sets the difficulty level of the mine to be mine next. On average, there are around 25 Bitcoins mined every 10 minutes. During the process, only a set number of Bitcoins can be mined during a certain period. After every four years, this reward is halved. Currently, it is up to 12.5 Bitcoins for every mathematical problem solved.
Fiat currencies have an unlimited supply and their value can be easily manipulated anytime by the regulatory bodies. Given its independent nature, Bitcoin has tightly restricted supply controlled by the underlying algorithm of the system. There is a set number of coins that can ever be mined ever. A total number of 21 million bitcoins exist in the system.
Bitcoin at its peak has managed to engage the market by over 2 million dollars. The lowest has been $2. Today the value roughly swifts around $9,000.
No economy supports the sudden fluctuations in the system. Too much too fast will result in the dropping of the value of the currency. Too much too slow will cause the economy to halt. Due to these reasons, Bitcoin has a self-stabilizing system to regulate the economy at the most favorable grounds.
Exchangers allow the holders to transfer and buy or sell these Bitcoin crypto coins among other users. One of the famous platforms is Bitstamp. This allows users to buy Bitcoins in fiat currency and also enables them to sell them to other potential users. Bitstamp enables users to store the coins too as e-wallets. But beware of the hackers, as they can dangerously destabilize these digital economies.
With the gradual growing influence of these cryptocurrencies in the world today, a lot of applications and platforms have shown loyalty to the Bitcoin. Platforms like WikiLeaks and WordPress have started accepting bitcoins as means of their payments and transaction currency.
Inspired by the Bitcoin, the Canadian government has launched a similar cryptocurrency named, MintChip. This electronic currency is backed by the government, unlike the Bitcoin.
According to the chairman of the US SEC (Securities and Exchange Commission), Jay Clayton, ‘all ICOs (Initial Coin Offerings) are not fraudulent’. These remarks were made by Clayton, on 5th April, during a speech at Princeton University. Clayton also added that stamping out fraud in the cryptocurrency market is perilous to protect customers. As well as, the improved regulatory analysis will essentially benefit the industry by removing fraudsters from it and con artists who give the whole place a bad name. Since there’ve been many ICO fraud cases before, the remarks of Clayton became viral.
Jay Clayton’s Remarks
“Is the approach taken in Washington by the SEC adversely affecting distributed ledger technology in other areas? My hope is that it’s actually helping because this technology is being used for fraud… And to the extent that it’s being used for fraud, history shows that government comes down harshly on that technology later.”
He also added:
“If we don’t stop the fraudsters, there is a serious risk that the regulatory pendulum – the regulatory actions – will be so severe that they will restrict the capacity of this new security.”
Clayton signalled about SEC investigations, in February 2018, that his agency would be investigating cryptocurrencies and at that time, he said:
“I believe every ICO I’ve seen is a security.”
However, a few weeks later, ICOs were again targeted by the SEC as it issued dozens of subpoenas to the tech-companies related to cryptocurrencies, and counsellors to explore how ICOs are organized.
ICOs Ceased for Scam
Fraud charges were filed against the co-founders of Centra Tech, Robert Farkas and Sohrab Sharma on April 2, by the Securities and Exchange Commission. Centra tech co-founders were accused of raising $32 million by vending unregistered securities throughout the Centra ICO, as it was promoted by Floyd Mayweather (boxing champ) and DJ Khaled (record producer).
According to public documents, the SEC is now looking forward to two bitcoin exchange-traded funds for listing on the NYSE Arca, which is the first “all-electronic” exchange in the US. The name of these two-bitcoin exchange-traded funds are:
- The ProShares Bitcoin ETF
- The ProShares Short Bitcoin ETF
SEC to Allow Cryptocurrency ETFs
Cboe president, Chris Concannon advised the agency to permit crypto ETFs and soon after that, the SEC consideration of bitcoin ETFs showed up. In a letter, that was sent to the SEC, on23rd March, Concannon sacked criticism that virtual currencies are extremely volatile to be treated like other dependable commodities.
Concannon wrote in the letter:
“Because of its innovative features as a digital asset, bitcoin has gained wide acceptance as a secure means of exchange in the commercial marketplace and has generated significant interest among investors.”
Concannon also added that there is sufficient reliable price info from the bitcoin futures market on CME and Cboe Futures Exchange that must alleviate the regulatory uncertainties about its impenetrability as an asset-tool.
Bitcoin is a form of digital money – also known as cryptocurrency that is free from the influence of any bank or governing authority. Bitcoin is used to make transactions anonymously on the global scale. The currency was created by a group called Satoshi Nakamoto and first came into circulation in 2009. The identity of group members is still unknown.
The usage of Bitcoin is increasing and the number of people making Bitcoin transactions is growing each day.
If you are one of the people who feel fascinated by this form of money and want to discover more about it, here are some intriguing Bitcoin facts for you.
There Is No Authority to Control This Currency:
You might be surprised to know that there is no entity that controls Bitcoin. The general concept of money is that it is controlled by a bank or other concerning authorities. But this is not the case with Bitcoin. The currency is autonomous from all sorts of regulatory authorities. The only person who can control the coins is the one who owns it.
Bitcoins Are Finite:
As bitcoins are not printed into cash or molded into physical coins, most people think that there should be an infinite number of bitcoins in existence. But this is not the case because if it were true, the coins would lose their worth. In order to keep them worth having, bitcoins are kept finite. The exact number of existing bitcoins is 21 million.
Bitcoin Has No Set Values:
There are no set values on Bitcoin. In fact, how much a bitcoin is worth depends on the popularity of the currency. The more people use it, the more it appreciates in value.
Bitcoin is Transparent:
Bitcoin is completely transparent in terms of transactions and amount. Each and every detail related to a transaction is available on blockchain. This openness, as a result, induces trust and security among the Bitcoin users.
In Bitcoin mining, the users are supposed to solve mathematical problems using a specialized software to verify transactions around the globe. The users in return, are paid if their efforts were successful.
Bitcoin Transactions Are Irreversible:
The Bitcoin transactions are irreversible and a user can never be forced to pay. Once the bitcoins are paid, there is no way to revoke the transaction or force the receiver to pay back your coins.
It Costs Little to No Money to Make a Transaction:
Bitcoin transactions cost little to no money. There are no taxes on the currency and it doesn’t matter to which part of the world you send the money, there are no cuts on transactions and the receiver gets the exact amount that was sent to him.
Lastly -Bitcoins Are Stored in Digital Wallets:
Bitcoin wallets are equivalent to bank accounts for real cash. These wallets are used to store, withdraw and transfer bitcoins from one wallet to another. The wallets are protected by a security key and only the owner can know about it until he reveals it someone else.
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