What is Bitcoin?

A man uses a Bitcoin ATM at Waves Coffee House in Vancouver on October 29. Photo: CFP

Bitcoin was born 4 years ago, created by a Japanese hacker named Satoshi Nakamoto. The digital currency isn’t owned or controlled by any government. Unlike traditional currencies, where a central bank decides how much money to print based on goals like controlling inflation, no central authority governs the supply of Bitcoins. It uses cryptographic technology to ensure the funds you receive are genuine.

The total number of Bitcoins is fixed at 21 million.

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. Bitcoin is open-source; its design is public, nobody owns or controls Bitcoin and everyone can take part. Through many of its unique properties, Bitcoin allows exciting uses that could not be covered by any previous payment system.

Highlights: Instant peer-to-peer; Worldwide payments; Zero or low processing fees

(Source:bitcoin.org)

Latest News

Bitcoin hits new of $675

Bitcoin growing in popularity in China More than half the value of all Bitcoin transactions are conducted in yuan, according to data from US virtual currency research center Genesis Block, though experts warn that investment in Bitcoin is more riskier than other investment tools.  Chinese 'damas' mad for Bitcoin With the Chinese market increasingly optimistic about the digital currency's potential growth, an online bitcoin platform has released that 40 percent of its VIP traders are Chinese women, the Beijing Youth Daily reported. Online China-focused Bitcoin platform closes An online Bitcoin trading platform aimed at Chinese investors has suddenly closed, leaving hundreds with more than 20 million yuan ($3.3 million) in combined losses, a newspaper said Nov. 13.

Bitcoin value surges Chip designers see dollar signs in Bitcoin miners Hard cash: Will Bitcoin, the world of virtual money, work out in the long run?

Around the World

Bitcoin in China
	The highest price of a Bitcoin in China Tuesday was 6,989 yuan ($1,146.60), while the highest price on November 1 was 1,275 yuan, according to Chinese Bitcoin trading platform btcchina.com. In less than 20 days, Bitcoin rose more than four times in value.  China surpassed the US and Japan to become the biggest market for Bitcoin this year, news portal sina.com reported Tuesday.  Related policy: The government has banned the trading of virtual currencies in online games to prevent potential risk to economic and financial order, according to a government notice.
Bitcoin in US
	US judge: Bitcoin subject to regulation A federal judge has given the green light to US regulators to proceed with their Bitcoin Ponzi scheme lawsuit. The ruling is expected to have major implications for the virtual online money system.
Bitcoin in Canada
	C$100K traded through Vancouver’s Bitcoin ATM in one week The world’s first bitcoin ATM — located in a coffee shop in downtown Vancouver — traded C$100,000 of the cybercurrency in its first week, said the man behind the machine.
Bitcoin in Germany
	Germany endorses Bitcoin Germany’s Ministry of Finance recently endorsed Bitcoins as private money, making it the first country to legally accept Bitcoins. The Cryto-currency is expected to be governed under the same fiscal and legal rules as the Euro.

Sky Rocketing

(Source: Btc123.com  Graphics:GT)

Commentary

China's media

Global Times:
Bitcoin growing in popularity in China
Bitcoin will not collapse soon as long as people still believe that Internet is the future and no other better virtual currency is created, Li Chao, an analyst with Internet service consultancy iResearch, told the Global Times Tuesday. 

However, Bitcoin has shortcomings that are hard to overcome, Li said, noting the absolute total amount of Bitcoin protects it from inflation but also hinders it from effectively keeping up with the economy development.

It is also difficult to set an objective value for Bitcoin, and the fact that its value is set completely by the market leads to high risks, Li said. 

In addition, as a virtual currency, unlike stakes or futures, Bitcoin is not backed by any real property; therefore, buyers of Bitcoin are confronted with risks higher than any other investment tools, he noted. 

South China Morning Post:
Bitcoin investors cash in as US says it could embrace the virtual currency
A positive US senate committee hearing on the digital currency has raised its value, and hopes it will keep on rising if criminals are shut out.

Oriental Morning Post
“An innovation in the finance, we should recognize Bitcoin’s value to improve the efficiency of future financial services. Although Bitcoin is still in its infancy, we believe as they develop more products and services, and as more companies participate and experience sound development, Bitcoin will show tremendous value,” Han Yan, executive director of Shanghai-based Lightspeed China Partners, told the Shanghai-based Oriental Morning Post. 

sohu.com 
Ben Bernanke, the US Federal Reserve's Chairman, said Nov.18 that Bitcoin and other virtual currency might promote a faster, safer and more effective payment system but they also bring regulatory risks, news portal sohu.com reported.

Foreign media

Forbes:
How Is Bitcoin Different From The Dollar?
Only when governments standardized and verified such coins – and provided security for mints – were coins widely used as a medium of exchange. 

There’s no doubt that Bitcoin is an interesting invention, useful at a minimum for provoking good classroom discussions in Money and Banking courses about what exactly is the meaning of money. But people should be wary of investing large amounts of their savings in Bitcoins. History provides plenty of reasons to suspect that private money is unlikely to work. Maybe this time is different. Usually it’s not.

Independent.ie:
Stephen Kinsella: Once bitten twice shy, so stay away from Ponzi-like Bitcoins
Bitcoin has no use value, only exchange value, and because it is has no worth in use other than what others are willing to pay for it, it is always in a bubble: these happen when prices of assets get dislodged from their fundamental value. So Bitcoin is the perfect bubble.

Reuters:
Bitcoin surges to new high ahead of US government hearing
Association with drugs, money laundering, murder for hire and other illegal activities has not stymied interest in bitcoin, the digital currency not backed by any government or central bank and until recently a niche alternative currency touted by computer geeks and anti-government advocates.

Web editor: wangnan1@globaltimes.com.cn