That bitcoin thing…

5 Aug

So a few weeks a go I wrote a post introducing bitcoin and gave a fairly rudimentary explanation of what it is and where it comes from. In fact, a couple of things I mentioned were not completely accurate because, I was, and still am, learning about the currency, but I have a pretty good grasp of it now, even if I am not totally au fait with all the technological jargon.

I mention it again as things are moving along and hopefully, by next month, we shall have our app (initially for the iPhone but with an Android version following soon after.)

As a recap, bitcoin is the decentralised, virtual currency, which is transacted over the internet. It has no central authority controlling it so is transferred person to person without any middlemen charging fees or taking a percentage cut of every transaction. It also means it can be used anywhere in the world with no currency exchange costs. It is managed by a peer-to-peer, global computing network. These computers use specially-designed hardware called miners, to crunch away at complex algorithms. Once they have decoded a block of data, bitcoins are issued and this is the way bitcoins are released into circulation. They are held in digital wallets on the internet. There is a predetermined release rate of bitcoins and the bitcoin algorithm can increase in difficulty so even if more and more people start mining for the currency, the market won’t be flooded with bitcoins.  By 2040, all the bitcoins will have been mined.

The fact an increasing number of people are becoming interested in bitcoin is because for small businesses in particular, it offers a lot of benefits. The lower fees and ability to do business internationally without worrying about currency exchange rates are just a couple of advantages. Due to the finite number of bitcoins that can ever exist, it is also inflation-proof and so people who own bitcoins know it cannot be devalued. Then there is the ease of using it, for anyone with access to the internet or a smart phone can transfer bitcoins from one bitcoin address to another quickly and securely.

The currency was created by an unknown, enigmatic individual or group of people, known as Satoshi Nakamoto in 2009. Many of the bitcoin evangelists describe themselves as financial libertarians, that’s not to say they are all anti-state or anti-government, but they do want control over their own money and an alternative to their fiat savings, which are being continually debased and devalued over time.

The owner and founder of BitScan asked me to get involved a few weeks a go and in that time, as well as helping out with some of the elements to the app, future web content and getting my head around bitcoin, I have been writing features for the BitScan features blog. It has been an interesting endeavour, in particular due to some of the people I have met and interviewed. These vary from a Cumbrian taxi driver to a bitcoin miner to various entrepreneurs within the bitcoin world. It is a world that might be relatively small but it is growing. Right now it feels as if those in the know are on the brink of something, which could be potentially huge. Similarly to the Internet all those year’s a go when the nay-sayers all said it would never take off, bitcoin is not only a currency, but a whole concept, which can take some time to understand and accept.

It will probably never exist alone and maybe never become the primary, global currency, but as  growing numbers want a bite of the bitcoin apple, it could well become a much more mainstream and viable option to other fiat currencies. For a start, one economist has declared it should be the national currency of Iceland.

One article on this is here:  http://www.coindesk.com/why-iceland-should-use-bitcoin-as-its-national-currency-btclondon/

A video showing some of his talk is here: http://bitcoinviews.com/bitcoin-london-2013-sveinn-valfells-should-iceland-adopt-bitcoin-as-its-national-currency/

Now on to us!

© Copyright BitScan

© Copyright BitScan

Our own website can be found by clicking here – take a look and see what you think. At the moment, it is all very new and we are developing a proper, integrated blog and website, which will come in due course. Rob’s analysis of bitcoin’s performance on the markets is proving a big hit and my Features blog can be found via the main home page or here.

Finally, I pitched one of my features to Coin Desk, one of the main bitcoin news sites, and it was their top story when it was published on Friday and still in their Most Popular and Must Read lists. It also got a big mention in their weekly roundup. It is a great story about the youngest bitcoin entrepreneurs, bees, honey and bitcoin! You can find a link to that story on our features blog here: http://bitscanfeatures.blogspot.com.au/2013/07/lifes-sweet-with-bitcoin.html

 

So there you go,  take a look and if you are particularly interested in how bitcoins are released (or mined) and how that all works, I wrote a feature on it recently, which hopefully cuts through too much technical jargon! Take a read: http://bitscanfeatures.blogspot.com.au/2013/07/going-down-mine.html

 

 

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2 Responses to “That bitcoin thing…”

Trackbacks/Pingbacks

  1. Finishing Lines | Upside Down - November 8, 2013

    […] attempting the bitcoin explainer again (see previous posts), the app has been designed as an interface for all and any users of bitcoin. It is packed full of […]

  2. BitScan Pty Ltd. launches its Bitcoin App for Android | NewsCanada-PLUS News, Technology Driven Media Network - March 26, 2014

    […] That bitcoin thing… […]

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