A coin that no one can touch is now worth over a thousand dollars. It's Bitcoin, the virtual currency that travels on the Internet and whose value today for the first time has exceeded one thousand dollars. Bitcoin took off quickly after discussions on cryptocurrencies in the US Senate committee earlier this month, particularly when the said committee called Bitcoin "a legitimate financial service."
There has been a debate about virtual currencies for some time, especially for their main feature: they make it difficult to trace transactions. A benefit that has made them particularly popular in illegal online activities.
The most striking case is that of Silk Road, a site where illegal drugs were exchanged and which was closed last month. Apparently, users/consumers would have paid in Bitcoin.
Many worried that the crackdown would cause the value to plummet, but growing confidence that regulators would not immediately ban the coin sent prices soaring.
For Bitcoin fans, this is the most efficient way to handle money transfers globally. “The value of a single Bitcoin has gone from 0 to a thousand dollars in just 5 years is something spectacular – Bitcoin developer Mike Hearn told the BBC – And we must not forget that the true value of a virtual currency is not in an arbitrary exchange rate, but in the ability to offer new applications and services that are not possible with traditional payment methods”.
The value of Bitcoin is actually very fluctuating. Many define it as a new currency, but in reality it would be better to think of virtual tokens rather than coins or banknotes.
Like all currencies, its value is determined by how many people want to trade. But to make a transaction in Bitcoin, you have to start a process called “mining”. That is to say making your computer available to solve a complex 64-digit math problem.
For each problem solved, one (or more) bitcoins are obtained.
In fact, it is an incentive to offer the computing capacity of one's PC to solve problems. In this way, 3600 new Bitcoins are created every day. Today, of these virtual coins, there are 11 million.
To receive a Bitcoin, the user must have a Bitcoin address – a string of 27-34 numbers and letters – which functions as a virtual mailbox for sending and receiving coins. And, since there is no record of these addresses, people can use them to remain anonymous during a transaction.
