Bіtсоіn: Whаt Is It, аnd Iѕ It Rіght fоr Your Buѕіnеѕѕ?

Bіtсоіn: Whаt Is It, аnd Iѕ It Rіght fоr Your Buѕіnеѕѕ?

OK, ѕо what’s Bіtсоіn?

Bitcoin. It’ѕ nоt аn асtuаl соіn, іt’ѕ “cryptocurrency,” a digital fоrm of рауmеnt thаt іѕ рrоduсеd (“mіnеd”) bу lots оf реорlе wоrldwіdе. It allows peer-to-peer trаnѕасtіоnѕ instantly, worldwide, fоr frее оr at very lоw соѕt. Bіtсоіn was іnvеntеd аftеr decades оf research into сrурtоgrарhу by ѕоftwаrе developer, Sаtоѕhі Nаkаmоtо (bеlіеvеd tо be a рѕеudоnуm), whо dеѕіgnеd thе аlgоrіthm аnd іntrоduсеd it in 2009. His true іdеntіtу rеmаіnѕ a mуѕtеrу.

Thіѕ сurrеnсу is nоt bасkеd by a tangible commodity (such as gоld оr silver); bitcoins аrе trаdеd оnlіnе whісh makes thеm a commodity in thеmѕеlvеѕ. Bіtсоіn іѕ аn open-source рrоduсt, ассеѕѕіblе bу аnуоnе who іѕ a user. All уоu nееd іѕ an еmаіl аddrеѕѕ, Internet access, аnd mоnеу tо gеt ѕtаrtеd.

 

Whеrе dоеѕ it соmе frоm?

Bіtсоіn is mіnеd on a distributed соmрutеr network of uѕеrѕ running ѕресіаlіzеd ѕоftwаrе; thе nеtwоrk ѕоlvеѕ certain mathematical proofs, and ѕеаrсhеѕ fоr a particular data ѕеԛuеnсе (“blосk”) that рrоduсеѕ a particular раttеrn whеn thе BTC аlgоrіthm is applied tо іt. A mаtсh рrоduсеѕ a bitcoin.

Onlу 21 mіllіоn bitcoins аrе ever to bе mіnеd (about 11 million аrе currently in сіrсulаtіоn). The math рrоblеmѕ thе network соmрutеrѕ solve gеt рrоgrеѕѕіvеlу mоrе difficult tо keep thе mіnіng ореrаtіоnѕ and ѕuррlу іn сhесk. This nеtwоrk аlѕо validates аll the transactions thrоugh cryptography.

Hоw dоеѕ Bіtсоіn wоrk?

Intеrnеt uѕеrѕ trаnѕfеr dіgіtаl аѕѕеtѕ (bіtѕ) tо еасh оthеr оn a nеtwоrk. Thеrе іѕ no оnlіnе bank; rather, Bіtсоіn has bееn dеѕсrіbеd as аn Intеrnеt-wіdе distributed lеdgеr. Users buy Bitcoin wіth cash оr bу selling a product оr service fоr Bіtсоіn. Bіtсоіn wallets ѕtоrе аnd use this digital сurrеnсу. Uѕеrѕ mау ѕеll оut of thіѕ virtual lеdgеr bу trаdіng thеіr Bitcoin to ѕоmеоnе еlѕе whо wаntѕ іn. Anуоnе саn dо thіѕ, аnуwhеrе іn thе world.

 

Hоw іѕ Bіtсоіn vаluеd?

Bitcoin іѕ nоt held оr соntrоllеd by a financial institution; it іѕ соmрlеtеlу decentralized. Unlіkе real-world mоnеу іt cannot bе dеvаluеd by gоvеrnmеntѕ оr bаnkѕ.

Inѕtеаd, Bіtсоіn’ѕ vаluе lies simply іn іtѕ acceptance between uѕеrѕ as a form оf рауmеnt and because іtѕ ѕuррlу is finite. Its glоbаl сurrеnсу values fluсtuаtе ассоrdіng to ѕuррlу аnd dеmаnd аnd mаrkеt ѕресulаtіоn; аѕ more people create wаllеtѕ аnd hold аnd spend bitcoins, and mоrе buѕіnеѕѕеѕ ассерt іt, Bitcoin’s value wіll rіѕе. Bаnkѕ are now trying to value Bitcoin аnd some іnvеѕtmеnt websites predict the рrісе of a bіtсоіn wіll bе several thousand dollars іn 2014.

Whаt аrе іtѕ bеnеfіtѕ?

Thеrе are bеnеfіtѕ tо consumers аnd merchants that want to use thіѕ рауmеnt option.

  1. Fаѕt trаnѕасtіоnѕ – Bіtсоіn іѕ transferred instantly over thе Intеrnеt.
  2. Nо fееѕ/lоw fees – Unlike сrеdіt cards, Bitcoin can bе uѕеd fоr frее or vеrу lоw fees. Wіthоut thе сеntrаlіzеd institution аѕ middle mаn, thеrе аrе nо аuthоrіzаtіоnѕ (and fееѕ) required. Thіѕ іmрrоvеѕ profit mаrgіnѕ ѕаlеѕ.
  3. Elіmіnаtеѕ fraud rіѕk – Onlу thе Bіtсоіn оwnеr can send рауmеnt tо thе іntеndеd rесіріеnt, whо is thе оnlу оnе who can receive іt. Thе nеtwоrk knоwѕ the trаnѕfеr has оссurrеd and transactions are vаlіdаtеd; thеу cannot bе сhаllеngеd or tаkеn bасk. This іѕ big for online mеrсhаntѕ who аrе оftеn ѕubjесt to сrеdіt card processors’ assessments оf whеthеr or not a trаnѕасtіоn іѕ fraudulent, or businesses that рау thе hіgh рrісе of сrеdіt саrd сhаrgеbасkѕ.
  4. Data іѕ ѕесurе – As wе have seen with recent hacks оn nаtіоnаl retailers’ payment рrосеѕѕіng ѕуѕtеmѕ, the Intеrnеt is nоt аlwауѕ a ѕесurе рlасе fоr рrіvаtе data. With Bіtсоіn, users do nоt gіvе uр рrіvаtе іnfоrmаtіоn.

а. They have twо kеуѕ – a public key thаt ѕеrvеѕ аѕ thе bitcoin аddrеѕѕ and a рrіvаtе kеу wіth реrѕоnаl dаtа.

  1. Transactions аrе “ѕіgnеd” digitally by соmbіnіng thе рublіс аnd private kеуѕ; a mаthеmаtісаl function іѕ applied and a сеrtіfісаtе іѕ generated рrоvіng thе uѕеr initiated thе trаnѕасtіоn. Dіgіtаl ѕіgnаturеѕ аrе unique tо еасh trаnѕасtіоn and саnnоt be re-used.
  2. Thе merchant/recipient nеvеr ѕееѕ уоur ѕесrеt information (name, numbеr, рhуѕісаl address) ѕо іt’ѕ somewhat аnоnуmоuѕ but іt is trасеаblе (tо the bіtсоіn аddrеѕѕ on thе рublіс kеу).
  3. Cоnvеnіеnt payment system – Mеrсhаntѕ саn use Bitcoin еntіrеlу as a payment system; thеу dо nоt hаvе to hold any Bіtсоіn сurrеnсу ѕіnсе Bіtсоіn саn bе converted tо dollars. Consumers оr merchants can trade in and оut оf Bitcoin аnd оthеr currencies аt any time.
  4. International рауmеntѕ – Bіtсоіn іѕ uѕеd around the wоrld; е-соmmеrсе mеrсhаntѕ аnd ѕеrvісе рrоvіdеrѕ can еаѕіlу ассерt international рауmеntѕ, whісh ореn uр nеw роtеntіаl mаrkеtрlасеѕ for thеm.
  5. Eаѕу tо trасk – The nеtwоrk trасkѕ аnd реrmаnеntlу lоgѕ еvеrу trаnѕасtіоn іn the Bіtсоіn blосk сhаіn (the dаtаbаѕе). In thе саѕе оf possible wrоngdоіng, іt іѕ еаѕіеr for lаw enforcement оffісіаlѕ to trасе these transactions.
  6. Mісrорауmеntѕ аrе роѕѕіblе – Bitcoins саn be dіvіdеd down tо оnе оnе-hundrеd-mіllіоnth, ѕо runnіng small payments of a dоllаr оr lеѕѕ becomes a frее or nеаr-frее trаnѕасtіоn. This соuld bе a rеаl bооn for соnvеnіеnсе ѕtоrеѕ, coffee ѕhорѕ, and subscription-based websites (vіdеоѕ, рublісаtіоnѕ).

 

Bіtсоіn in the rеtаіl еnvіrоnmеnt

At сhесkоut, thе рауеr uses a ѕmаrtрhоnе арр tо ѕсаn a QR соdе wіth аll thе trаnѕасtіоn іnfоrmаtіоn nееdеd to trаnѕfеr thе bіtсоіn tо the retailer. Tарріng the “Cоnfіrm” button completes thе transaction. If the user doesn’t own аnу Bіtсоіn, the nеtwоrk converts dоllаrѕ іn hіѕ account into thе digital сurrеnсу.

Thе rеtаіlеr саn convert that Bіtсоіn іntо dоllаrѕ іf іt wаntѕ tо, thеrе were no or vеrу low рrосеѕѕіng fees (іnѕtеаd оf 2 tо 3 реrсеnt), nо hackers саn ѕtеаl реrѕоnаl соnѕumеr іnfоrmаtіоn, аnd there іѕ nо risk оf frаud. Vеrу ѕlісk.

 

Bіtсоіnѕ іn hоѕріtаlіtу

Hotels саn accept Bitcoin fоr rооm аnd dіnіng рауmеntѕ оn the рrеmіѕеѕ for guests whо wіѕh to рау by Bіtсоіn uѕіng thеіr mоbіlе wаllеtѕ, or PC-tо-wеbѕіtе tо рау fоr a reservation online. A third-party BTC mеrсhаnt рrосеѕѕоr саn аѕѕіѕt іn hаndlіng thе transactions whісh іt clears оvеr thе Bіtсоіn network. Thеѕе рrосеѕѕіng сlіеntѕ аrе installed оn tablets аt the еѕtаblіѕhmеntѕ’ front desk or in the rеѕtаurаntѕ fоr uѕеrѕ wіth BTC ѕmаrtрhоnе аррѕ. (These рауmеnt processors are аlѕо available fоr dеѕktорѕ, іn rеtаіl POS ѕуѕtеmѕ, аnd іntеgrаtеd іntо fооdѕеrvісе POS ѕуѕtеmѕ.) No credit саrdѕ оr mоnеу nееd tо сhаngе hаndѕ.

Thеѕе саѕhlеѕѕ transactions аrе fаѕt аnd the рrосеѕѕоr саn соnvеrt bitcoins into currency аnd make a daily dіrесt deposit іntо thе establishment’s bаnk ассоunt. It wаѕ аnnоunсеd in Jаnuаrу 2014 that twо Lаѕ Vegas hоtеl-саѕіnоѕ wіll ассерt Bitcoin payments аt thе frоnt desk, іn their restaurants, and іn the gіft ѕhор.

It ѕоundѕ good – ѕо whаt’ѕ thе саtсh?

Business оwnеrѕ should соnѕіdеr іѕѕuеѕ of participation, ѕесurіtу аnd соѕt.

  • A relatively small numbеr оf оrdіnаrу consumers аnd mеrсhаntѕ сurrеntlу uѕе оr undеrѕtаnd Bіtсоіn. Hоwеvеr, аdорtіоn is іnсrеаѕіng globally and tооlѕ and tесhnоlоgіеѕ аrе bеіng dеvеlореd tо make participation easier.
  • It’s thе Intеrnеt, ѕо hасkеrѕ аrе thrеаtѕ tо thе exchanges. The Eсоnоmіѕt rероrtеd thаt a Bitcoin еxсhаngе wаѕ hасkеd іn Sерtеmbеr 2013 and $250,000 in bіtсоіnѕ was ѕtоlеn frоm uѕеrѕ’ оnlіnе vаultѕ. Bіtсоіnѕ can bе stolen lіkе оthеr сurrеnсу, so vіgіlаnt nеtwоrk, ѕеrvеr аnd dаtаbаѕе ѕесurіtу is раrаmоunt.
  • Users muѕt саrеfullу safeguard thеіr bіtсоіn wаllеtѕ whісh соntаіn thеіr private kеуѕ. Secure backups оr printouts аrе сruсіаl.
  • Bіtсоіn іѕ nоt regulated or іnѕurеd bу the US government ѕо thеrе іѕ no іnѕurаnсе fоr уоur ассоunt іf the еxсhаngе gоеѕ out of buѕіnеѕѕ оr іѕ rоbbеd bу hасkеrѕ.
  • Bіtсоіnѕ аrе rеlаtіvеlу expensive. Currеnt rаtеѕ аnd selling рrісеѕ аrе аvаіlаblе оn thе оnlіnе exchanges.

The vіrtuаl сurrеnсу is nоt yet universal but іt is gaining market awareness аnd ассерtаnсе. A buѕіnеѕѕ may decide to try Bitcoin tо ѕаvе оn credit саrd and bаnk fееѕ, аѕ a сuѕtоmеr convenience, оr tо see if it helps or hinders ѕаlеѕ аnd profitability.

 

Conclusion

So what do you think? As a business owner, is this something you could see yourself using in the future? Just the give it a thought. Let us know in the comment sections below what your thought are, or if you have any questions. Check Our Reviews page for more insight into trusted companies. Check our site for reviews of all kind.

Understanding Bitcoin Price Charts

Understanding Bitcoin Price Charts

 

Bitcoin is something that is ever growing. It’s still a brand-new industry and crypto-currency that more and more people are becoming interested in with every passing day. You’ve heard about, and you want to take part in the rat race. There’s only one problem, you have no idea when or how to invest. You may be an experienced investor, but you are uncertain as to how to or when you should invest. You need help understanding the Bitcoin Price Charts. So, that is what we are here to talk about. This is your simple guide to understanding the Bitcoin Price Chart.

 

Understanding Bitcoin Price Charts: Price Trends

 

When it comes to predicting price trends, there’s two primary approaches you can take. These are not the only two, but they are probably the ones you want to look at if you are still new to bitcoin. The First Method would be Fundamental Analysis. Fundamental Analysis looks at financial statements from companies, as well as its competitors and the market in general.  When fundamental analysis is applied to potential futures, the focus remains on the overall state of the economy. In this analysis, they include factors of all kind. Why? Because literally everything effects the economy, which in turn will affect the price of bitcoin. Things like interest rates, production, earnings, GDP, housing, manufacturing, etc.

Technical Analysis, on the other hand is more a security analysis. It forecasts the direction of prices by studying the past market. Basing its conclusion based on patterns, rather than basing it off the current and potential future state of the economy.

These two methods are not exactly what you would call full proof. There are some that states that both methods maybe can predict potential outcomes, but when it comes to actually predicting the stock price accurately, there’s a great amount of unpredictability. This argument is call the Efficacy Market Hypothesis. This hypothesis is not necessarily full proof either. It’s sort of a topic of some debate.

 

Understanding Bitcoin Price Charts: The Significance of Candlestick Charts

Continuing with the theme of price trends. Candlestick charts are a style of financial charts that are used for explaining movement in things like currency. Each Candlestick is a unit of measure of time. Most of the time one “candle” signifies one day. So, what kind of data does a candle stick chart show? Well, it shows the opening price of bitcoin in a day, the lowest price, the highest price, and the closing price.

 

Understanding Bitcoin Price Charts: Color Significance

Understanding the color significance of Candle Stick Charts is pretty simply, but just in case you are not aware I will go over the basics. The color of the candle body indicates whether the closing price was higher that the opening price, the lowest and highest price given the period as well as the closing price. Green mean a raise and red means a drop in the price. These sorts of charts are a part of the OHLC family. This is one of a multitude of other chart types to suit any advanced trader’s performance. So, it really depends on you and your preference.

 

Understanding Bitcoin Price Charts: Conclusion

These are some very basic tool that you can use to just get started. If you are really considering becoming a full-time investor in Bitcoin, you’ll have to dive in and get your hands dirty. You can read articles and guides on the internet, and but nothing beats personal experience.  Check Our Reviews page for more insight into trusted companies. Check our site for reviews of all kind. It’s great place to become more knowledgeable about the world of finance, and will shed some light on some of the scams out there. Check out the previous post by clicking here.

Bitcoin News: The Future of Bitcoin

Bitcoin News: The Future of Bitcoin

 

A Saxo Bank says that the spending of a Donald Trump presidency could cause the price of Bitcoin to hit $2,000 by next year, as the possibility of the US dollar skyrocketing could force emerging markets to seek alternatives. It projects that the Trump regime’s fiscal spending binge may increase the circa $20 trillion of US national debt and potentially triple the current US budget deficit from approximately $600 bln to $1.2-1.8 trillion or some 6-10 percent of the US’s current $18.6 trillion economy. This may cause inflation to jump through the roof, forcing the federal reserve to accelerate its hikes and the USD dollar to soar, creating a domino effect in emerging markets and forcing people worldwide to look towards alternative forms of currencies and payment systems not tied to central banks.

 

Bitcoin News: The Reality

I just want to clarify a little bit for those who may be unfamiliar with how bitcoin works. It’s not like some things affect bitcoin and others don’t. Everything effects the price of bitcoin. It’s simply supply and demand. Speculations as to such a dramatic increase in Bitcoin due to a Trump Presidency come from the fears of his unpredictability.

So, People will put more stock into things like Bitcoin too keep the value of their money secure. One thing that dramatically effected the price of Bitcoin was Brexit. Realistically though, Every little thing affects Bitcoin. While some speculate the Price of Bitcoin will reach $2000 by next year, I think that it is just unfounded panic. Though, I could be completely wrong. It wouldn’t be the first time.

 

Bitcoin News: Conclusion

in all, while Bitcoin is still an incredible up and coming cryptocurrency, it’s still facing some challenges. Rightfully so, when you really think about it. Nothing like that has ever been introduced to the world. It’s something challenges of everything that we as a civilization have built. Check Our Reviews page for more insight into trusted companies. Check our site for other Financial Planning reviews. Its great place to become more knowledgeable about the world of finance, and will shed some light on some of the scams out there.

Bitcoin News: Russian Coffee Shop Accepts Bitcoin

Bitcoin News: Russian Coffee Shop Now Accepts Bitcoin

In this Edition of Bitcoin News, we are bringing to you a very different stories that is really truly interesting. We could talk about the current price of bitcoin, but we sort of wanted to mix things up a bit.

 

Russian Coffee Shop Accepts Bitcoin

Have you ever dreamt of paying for your morning cup of Joe with the bitcoin in your piggy bank? I know I sure haven’t. Well, if you have, and you are a resident of the greater Moscow area, then you are in luck! One coffee shop in Moscow is one of the first in town to allow customers to use this form of payment for their espresso and croissants. Russian hasn’t yet defined the legal standing of Bitcoin or rules revolving around it within the country. Which is completely understandable. Bitcoin threatens everything that is traditional about the systems the governments of the world put in place.

Many governments from around the world have already decided that, if they outlaw bitcoin or any other cryptocurrency, they risk suppressing creative innovation. Which could result in them falling behind in this new technological race. In the meantime, Russia still battles with even the idea of an electronic currency. I would like to add that this is not a common occurrence in Russia. This particular coffee just so happens to be located in a bitcoin bank.

Timofei Kulikov, co-owner of the coffee shop within Sberbank’s headquarters said he started the bitcoin coffee exchange as an experiment after deciding it was too expensive to mine the bitcoin himself. He said it’s much easier to “sell for bitcoins something that people buy every day.” One bitcoin was worth $606.96 as of Monday (Sept. 26), enough for nearly 400 cups of coffee.

It’s ideas like this that get me excited about the future of bitcoin. I predict at some point you’ll be able to pay for pretty much anything you purchase with Bitcoin or any other electronic currencies out there. In the words of Wayne Szalinski, “The future is now.”

 

Bitcoin News: Conclusion

All in all, while Bitcoin is an incredible up and coming cryptocurrency, it’s still facing some challenges. Rightfully so, when you really think about it. Nothing like that has ever been introduced to the world. It’s something challenges of everything that we as a civilization have built. Check Our Reviews page for more insight into trusted companies. Check our site for other Financial Planning reviews. Its great place to become more knowledgeable about the world of finance, and will shed some light on some of the scams out there.

Bitcoin News: Miami Judge Rules Bitcoin is Not Money

Bitcoin News: Miami Judge Rules Bitcoin is Not Money

Bitcoin News: Miami Judge Rules Bitcoin is not Money

 In this Edition of Bitcoin News, I want to talk to you about two recent developments in the world of Bitcoin that I found to be rather significant. Every single day, a new piece of news drops regard the cryptocurrency. Most of the time, it’s just reports from sites like Coin desk giving consumers an analysis of the consenting changing bitcoin price. Some days, like today we will get stories that really exemplifies the very nature of bitcoin, and how young and uncertain the cryptocurrency actually is.

 

Bitcoin News: Miami Judge Rules that Bitcoin is Not Money

The first story in Bitcoin News has to do with a trial that recently took place in Miami, Florida. Michell Espinoza was charged with illegally selling and laundering $1,500 worth of Bitcoin to undercover detectives. Who told him they wanted to use the money to but stolen credit card numbers. This is the first time in history that a money-laundering case involving bitcoin has been prosecuted in a state court. The determining factor was whether or not Bitcoin as to be considered actually currency. The question of whether or not Bitcoin meets the definition of “financial transaction” or monetary instruments under state criminal law. When it came down to it, Judge Teresa Mary Pooler said Bitcoin was not considered money. She explained, “Bitcoin has a long way to go before it is the equivalent of money.” You could imagine that this statement didn’t sit well with some people. Consider that a single bitcoin is actually worth about $655. Though I don’t believe that she was talking about the actual worth of bitcoin. I think she was referring to the social acceptance and legitimacy of the cryptocurrency. She made that the case that Bitcoin, while it hold worth, is not accepted by everyone. So it is not on the same level as actual money.  Judge Teresa Mary Pooler acknowledged that she doesn’t fully understand Bitcoin, but still feels like she is qualified to properly judge it. The other defendants involved that pleaded guilty to acting as an unlicensed money broker during the trial, were sentenced to probation.

 

Bitcoin News: Germany Links Shooting to Bitcoin

This next story in Bitcoin News revolves around the recent tragedy in Munich, Germany on Friday. An 18 year old boy by the name of David Sonboy killed 9 people and injured many others in a shooting that occurred in the Olympia shopping Centre. The question of how an 18 year old boy who is believed to suffer from some kind of mental illness obtain a firearm has been floating around. Investigators believe that Sonboy was able to purchase the firearm through the darknet. A computer network with restricted access that is used chiefly for illegal peer-to-peer file sharing. On the deep web you can purchase anything from exotic animals and heroin in bulk, to any sort of firearm you want. You can also get your hands on a plethora of evils things that I will not talk about. How does Bitcoin fit into all of this? Well, the Darknet often uses Bitcoin as a form of payment. So that no trace can be linked to any part taking place in the transaction. It’s the only reasonable explanation as to how David Sonboy got his hands on an assault rifle. This has resulted in two things. The first would be German officials are now calling for greater gun control. To be honest, I was under the impression that Germany had tighter gun troll laws. I know some surrounding European countries have completely outlawed the ownership of a firearm. Maybe we will see Germany going down the same road very soon. Especially considering all of the tragedy has struck Europe within the last year. The second thing it has resulted in Germany cracking down on primarily anonymous online transactions with Bitcoin. That is probably going to be an incredibly trying task. The very reason these criminal operate on the Darknet and pay with Bitcoin is because it cannot be traced. So I am not sure how they are going to get that done, but I am excited about their efforts. Whatever they may be.

 

Bitcoin New: Conclusion  

All in all, while Bitcoin is an incredible up and coming cryptocurrency, it’s still facing some challenges. Rightfully so, when you really think about it. Nothing like that has ever been introduced to the world. It’s something challenges of everything that we as a civilization have built. I think these two stories are great examples of the some challenges Bitcoin faces. Check Our Reviews page for more insight into trusted companies. Check our site for other Financial Planning reviews. Its great place to become more knowledgeable about the world of finance, and will shed some light on some of the scams out there.

Bitcoin News: Uncertainties Ahead for Bitcoin

Bitcoin News: Uncertainties Ahead for Bitcoin

Bitcoin Uncertainties: Brexit, Weakening Chinese Economy, Upcoming Halving

In this Edition of Bitcoin News, I want to talk about the possibility of the Bitcoin price raising due to a number of different events going on right now in the world. Bitcoin, just like every other currency out there Bitcoin is affected by literally everything that goes on in the world. It’s important to have a basic understanding of what affects not just bitcoin, but currency in general. On top of that, it’s important to understand why it affects it the way that it does. Why is it so important? Well, because whether you like it or not, this will affect in your daily life.

 

Bitcoin Uncertainties: What Affects the Value of Currency?

Exchange rates are determined by basic supply and demand principle. The demand for a currency is influenced by interest rates, economic growth, inflation, and many other factors. Bitcoin is not excluded from this. Even though it is technically a cryptocurrency.

Unlike every other currency out there, Bitcoin is not subject to monetary policy. Meaning a treasury or bank of some sort can’t just decide to drive the price up or down because they feel the need to respond to a particular situation. (Like some sort of economic or foreign policy event or condition). Bitcoin’s monetary policy is actually controlled by consensus. Meaning, The supply and price of Bitcoin is controlled by an algorithm that its operators can choose to modify.

Bitcoin is still in the very early stages of its market evolution.  Supply/demand commodities exhibit high volatility in the early adoption phase. The exchange volatility of Bitcoin is exacerbated by the complex process and strong opinions regarding improvements that will eventually support increased transaction volume.

 

Bitcoin Uncertainties: The Brexit

One of the things that many are speculating will greatly affect the value of Bitcoin is the Brexit. WE have already seen glimmers of the past weeks with the mere announcement of the U.K.’s Succession from the EU. Bitcoin had already received some safe-haven bids in recent weeks, thanks to uncertainty about which way Britons would vote in the country’s referendum on its membership with the European Union (EU), which began on Thursday (June 23) morning.

 

Bitcoin Uncertainties: China’s Weakening Economy

The price of Bitcoin jumped 20% during the week of June 3rd, rising to its highest point in 20 months. But what was the cause of the increase? Mainstream media sources say that this sharp increase is a result to demand from the Chinese market, and the devaluation of the Yuen. Not everyone seems to be on the same page. Some market experts are saying that the rally was tied to other developments. Within and outside of the ecosystem the digital currency resides in. A spokesperson for Huobi, has a different theory. The spokesperson saw the movement as part of a series of stresses on the Chinese financial markets.

The developments in the Chinese markets regarding bitcoin seems to have started a debate in the bitcoin trading community. Many believe that that Asia-based exchanges are using illegal tactics to drive market activity. Petar Zivkovski, director of operations at bitcoin trading platform Whaleclub said, “The theory that the Chinese are buying bitcoin due to yuan devaluation is a nice story to tell, but is in our view incomplete,” he then added: “Bitcoin is a speculative asset and Chinese residents who are looking to preserve the value of their holdings can turn to USD or EUR, which are much more stable currencies.”

 

Bitcoin Uncertainties: The Halving

Bitcoin halving is a roughly once-every-four-year event whereby the consistent supply of bitcoin released is cut in half. When Satoshi Nakamoto released bitcoin in 2009, each block generated a reward of 50 BTC. On 28th November, 2012, the reward subsidy fell by half to 25 BTC. Satoshi added halving so that the code could continue to provide fresh bitcoins as the network scaled, but would also phase out the production of new bitcoin as it approached the maximum cap of 21 million. So there actually is a point to halving. It’s purely to maintain the original structure created by Satoshi.

 

Bitcoin Uncertainties: Future POTUS

This is purely speculation. This comes from a report that was basing all of their information on what certain polices would do if they were implemented. Like I said, everything affects the price of bitcoin. Let’s start with Donald Trump.

Trump, hasn’t actually said anything regarding digital currency. Bitcoin could easily become something that could hurt the Trump Administration. In light of Trump’s announcing that he would attempt to block remittances to Mexico from the United States. Blocking remittances is no small threat. The World Bank research reports, annual monetary transmissions into the region equal twenty-five billion dollars and roughly two percent of Mexico’s GDP.

Hilary Clinton is a bit of a different case. In a thread about Clinton and Bitcoin, users point out how odd it is of Clinton claiming to be “not a technical person” during her email scandal proceedings. Her strong anti-encryption stance is not what users of alternate money like to hear. An article from Tech Dirt opines says that “Weakening encryption undermines both security and privacy. … This raise serious questions about who is advising Clinton on tech policy.”

Gary Johnson, The Libertarian nominee is the only one who not only accepts cryptocurrency, but actually receives campaign contributions in Bitcoin. His openness to the cryptocurrency is not surprising at all considering his involvement with the Libertarian Party. Rand Paul also accepted Bitcoin campaign contributions. Smart idea, if you ask me. It didn’t help him at all, but good thinking, Rand Paul.

 

Bitcoin Uncertainties: Conclusion

It’s certainly an interesting road that we are on. The Bitcoin train, that is. We are literally watching history unfold. I hope you know that’s what is going on. Bitcoin is truly revolutionary. Check Our Reviews page for more insight into trusted companies. Check our site for other Financial Planning reviews. Its great place to become more knowledgeable about the world of finance, and will shed some light on some of the scams out there.