Bitcoin And Digital Forms Of Currency

Some people only knew blockchain as the causal technology behind the always controversial digital currency Bitcoin. Yet, blockchain technology is so much, much more; it's unbelievably innovative and its potential is extensive to say the least. Much like the internet of today, there’s no need for you to know how this technology works to use

We take the position that digital currencies are a fad. As argument, we try to clarify the definition of currency in general and explain what a "digital currency" really mean. Than we examine the arguments for the digital currencies and at the end we present the evidences of perils of digital currency.

In December 2013, after a series of governments’ legislation was passed, the price of Bitcoin crashed. While many hoped for a revival, the prices continued to plummet until they reached low of $200. In one short year, the price had fallen to one-sixth of its previous high (“Complete Bitcoin’s Price Chart”). This fall proved what many thought; Bitcoin was a hoax.

The US Treasury declared bitcoin a decentralized virtual currency since payments work peer-to-peer, having no single repository. Bitcoin has since become the largest cryptocurrency in the market and the first fully instigated decentralized cryptocurrency. Bitcoins are created as a payment for processing work, where users’ computing power is utilized to verify and record payments into the public ledger. This process is called mining, one can receive transactions fees and newly created bitcoins in exchange for this process. Bitcoins can be sent and received electronically between users in exchange for money, products and services. Bitcoins is usually great for buying goods and service at lower prices than retailers for example, due to lack commercial mark-up and avoidance of credit card fees. However, bitcoins have a downside, one major problem is that bitcoins can be stolen as they are online based, hackers may gain access to user’s accounts.

Not everyone is optimistic about the future of Bitcoin. Its volatility, lack of regulation by the various regulatory agencies, and its use for financing of illegal activities have created many doubters.

Virtual currencies such as bitcoin are portrayed as an innovative design in the distribution of money throughout the world through the use of peer-to-peer transactions due to it being fraudulent and impossible to counterfeit. However, bitcoin holders are anonymous and could act in a similar way to black markets, their “bitwallet” is unregulated and untaxed. Using bitcoin as a currency also delves into the problem where users purchase illegal objects and substances anonymously.

With its debut in 2008, Bitcoin represents the first form of Digital Currency. The currency was the resulting financial reward from computer-generated ‘mining’ or solving of special cryptographic coding puzzles, thus forming encrypted and unique blockchains (or blocks of code and confirmation data to communicate back with other finished coins or processing centers). The currency was formatted to be completely decentralized from control, while offering a means for low-cost transactions via a global peer-to-peer network requiring no intermediaries (such as banks or payment processors), and presumed

Bitcoin (BTC), a cryptocurrency, is a type of digital currency which was introduced in 2009 by pseudonymous developer "Satoshi Nakamoto". Since then 12 million bitcoins have come into existence with a current market cap of around 8 billion USD [1]. The algorithm is designed as to allow only 21 million BTC to come into existence ever. Bitcoin uses peer-to-peer technology to operate with no central authority or banks; managing transactions and the issuing of bitcoins is carried out collectively by the network [2]. Bitcoin is not the first attempt. But none have managed before to take off so dramatically and with such wide adoption to achieve escape velocity. The questions which are important now are how the bitcoin managed this success in

Bitcoin; an online payment system introduced as open-source software in 2009, is the first decentralized crypto-currency to be fully implemented successfully. When buying something with a Bitcoin one simply transmits a symbolic token (much like paper currency), that is stamped with a unique number that transfers ownership to another person. Bitcoin is an emerging market of fresh customers who are searching for ways to spend their bitcoins. “Accepting a new payment method has often shown to be a clever practice for online businesses.”4 By accepting them, new customers will be attracted and give your business some new visibility.

Most people who are interested in technology have heard of Bitcoin. Many might not know the ins and outs of what it is or how it’s used, but they’ve at least heard of it. As someone who has taken an interest in computers, computer programming, and what’s going on in the tech world, I find the background and use of cryptocurrency extremely fascinating, if not a little perplexing. U.S. Senator Thomas Carper expressed the public’s opinion of cryptocurrency well in saying “Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others, and confused the heck out of the rest of us.” (Rosic, 2017).

I thought of writing a paper on Bitcoin because this is a very interesting topic and everyone tries to get into it, I will try to make this topic understandable by writing it in laymen’s language. Thanks to Professor Dr. Burnham who has given me this opportunity to write a paper on Bitcoin. According to the name of Bitcoin when we first hear this word “Bitcoin” we create image in our mind that there would be some coin kind of thing but there is no coin it is only a digital currency.

The above hen-pecked headlines clearly indicate the later part of cyber arena the information peer to peer system now into expansive appendage of online monetary exchange (digital currency) called the BITCOIN. The idea of no physical currency, easy leisurely tramway of cash with no holds barred wallet size gave BITCOIN the demeanor of futurity which will acquire the gamut of space in everyone’s life.

In 2009 an anonymous person known as Satoshi Nakamoto invented Bitcoin, a revolutionary creation which can change the world dynamics. Bitcoin can be defined as “a collection of concepts and technologies that form the basis of a digital money ecosystem” (Andreas M. Antonopoulos, 2014). Bitcoin can provide people with considerable benefits, such as low transaction fees and protection. Pitifully, appreciable weaknesses, which may counter its profits, are possessed by bitcoin. Can bitcoin overcome its Achilles heels and evolve into the currency of the future? This essay will analyze the different advantages and disadvantages that users receive from utilizing bitcoin and if bitcoin can become the coin of the future despite his weak points.

To start off primarily, Bitcoin is a digital currency as opposed to physical currency that we’re accustomed to and use in our daily life. Straight off their site, Bitcoin is described as a pseudo-anonymous, P2P technology operating with no central authority or banks, it’s open-source, public, owned by no one and open for everybody to take part; but what does that all mean? “Bitcoin is the leader in a new generation of emerging currencies known as “cryptocurrencies” which aim to, among other things, facilitate the movement of money electronically while still maintaining a sense of privacy,” (Hobson)

The courts seemingly have everything they need to already regulate and control cryptocurrency gambling. Recent court cases also show how everything is can be treated now or in the future. The IRS since 2014 has been viewing cryptocurrency as Property (Notation 2014-21, 2014). This forces cryptocurrency owners to report value changes over time, like they would for a plot of land. Then the CFTC in their recent case recognized cryptocurrency as a commodity, having all commodity trading laws regulate the trade of cryptocurrency(CFTC v McDonnell, 2018). This could have cryptocurrency be regulated like a currency swap, and make people exchanging cryptocurrency for USD be registered. Greatly reducing the risk of fraud and money laundering.