Nothing like a little bit of speculation gone wild to kick off the holiday spending season.
Bitcoin just traded past the $1,000 per coin mark on Mt.Gox, one of its largest exchanges - as we write this, it's at $1,022, with a high of $1,030 a few moments ago.
The currency has been on a massive run the past several days, shooting up hundreds of dollars per unit, prompting complaints that its value is overheated, leaving its price unmoored from any sort of inherent utility. Well, yes, but it's still fun to watch.
Here's the chart that shows how the price has been creeping up:
The market capitalization of the Bitcoin market is far above the potential stored functional use of the currency in even the medium-term, implying to me that it is overvalued. Do what you will, just be careful.
2013年12月1日 星期日
Bitcoin is soaring, but financial advisers are steering clear for now
Bitcoin is soaring to record heights, hitting the $1,000 mark Friday for the first time, but financial advisers aren't biting — yet, anyway.
The virtual currency passed the quadruple digit price shortly before 10 a.m. on the Mt. Gox exchange and has since soared higher than $1,020. That marks a gain of about 5,000% from the $20 level at which Bitcoin was trading at the start of this year.
Despite the hype, many advisers are steering clear of the online currency, which is unregulated by central banks and traded freely on the Internet. Because the digital currency is so new and its rise has been so fast, advisers are doing their homework before investing clients' money.
The virtual currency passed the quadruple digit price shortly before 10 a.m. on the Mt. Gox exchange and has since soared higher than $1,020. That marks a gain of about 5,000% from the $20 level at which Bitcoin was trading at the start of this year.
Despite the hype, many advisers are steering clear of the online currency, which is unregulated by central banks and traded freely on the Internet. Because the digital currency is so new and its rise has been so fast, advisers are doing their homework before investing clients' money.
What Bubble? Bitcoin Tops $1000.
Bitcoin topped $1000 for the first time Wednesday morning.
It’s the latest milestone in yet another epic rally for the four-year old virtual currency created a man or group of people going by the name Satoshi Nakamoto.
As of early 2010 was valued at just 4 cents, according to Mt. Gox. That’s a 2,499,9000% jump.
As of Oct. 1, 2013, bitcoin closed at $140.3. The jump in less than two months: 614%.
The value of a bitcoin keeps rising but with intense bouts of volatility. With each drop in the cybercurrency’s price, bitcoin naysayers are quick to point to popping of the bitcoin bubble.
For today at least, the bitcoin bulls are winning.
It’s the latest milestone in yet another epic rally for the four-year old virtual currency created a man or group of people going by the name Satoshi Nakamoto.
As of early 2010 was valued at just 4 cents, according to Mt. Gox. That’s a 2,499,9000% jump.
As of Oct. 1, 2013, bitcoin closed at $140.3. The jump in less than two months: 614%.
The value of a bitcoin keeps rising but with intense bouts of volatility. With each drop in the cybercurrency’s price, bitcoin naysayers are quick to point to popping of the bitcoin bubble.
For today at least, the bitcoin bulls are winning.
Bitcoin breaks through the $1,000 barrier
Bitcoin, the internet currency that has surged in popularity this year, has broken through the $1,000 barrier for the first time, marking a fivefold increase since the start of the month.
Based on trading on the Mt Gox exchange, Bitcoin rose from around $960 at midday on Wednesday to a high of $1,030 as of 15.15.
This comes despite concerns about its security and volatility, although Bitcoin has lost some of its stigma following the closure of the Silk Road, the online drugs marketplace that used it as a currency.
Last week, the currency jumped in value after US senators heard that Bitcoin is "a legal means of exchange".
“We all recognize that virtual currencies, in and of themselves, are not illegal,” Mythili Raman, acting assistant attorney general at the Justice Department’s criminal division, said at the hearing.
Supporters of Bitcoin point to the fact that it is not controlled by a central bank and has a limited supply, unlike traditional currencies whose value has been diluted by quantitative easing.
It surged in popularity in April as Cyprus's banks teeteered on the brink of collapse, with some pinning the rise in Bitcoin's value on investors looking for a safer place to put funds.
Based on trading on the Mt Gox exchange, Bitcoin rose from around $960 at midday on Wednesday to a high of $1,030 as of 15.15.
This comes despite concerns about its security and volatility, although Bitcoin has lost some of its stigma following the closure of the Silk Road, the online drugs marketplace that used it as a currency.
Last week, the currency jumped in value after US senators heard that Bitcoin is "a legal means of exchange".
“We all recognize that virtual currencies, in and of themselves, are not illegal,” Mythili Raman, acting assistant attorney general at the Justice Department’s criminal division, said at the hearing.
Supporters of Bitcoin point to the fact that it is not controlled by a central bank and has a limited supply, unlike traditional currencies whose value has been diluted by quantitative easing.
It surged in popularity in April as Cyprus's banks teeteered on the brink of collapse, with some pinning the rise in Bitcoin's value on investors looking for a safer place to put funds.
Internet money: What you need to know about Bitcoins
The crypto-currency made headlines again this week after James Howell, an IT worker from Newport, Wales, discovered he accidently threw out a hard drive containing 7,500 bitcoins -- now worth almost $8 million.
Howell obtained the bitcoins in 2009 for almost nothing. When he discarded his hard drive last July -- now buried in a Newport landfill the size of a soccer field -- the bitcoins were worth nearly $900,000.
Today, the value of one Bitcoin has soared to over $1,000.
Here are a few things to know about the virtual currency:
What is Bitcoin?
Bitcoin is a decentralized peer-to-peer digital currency and payment network. It is completely based on the belief that Bitcoin has value.
Hoss Gifford of OneMethod Inc. explains that “unlike traditional currencies, it’s not tied to any one country or any bank.”
“Unlike a traditional currency, it doesn’t have a reserve; there is no big vault underground somewhere with a lot of gold,” he says.
Instead, Bitcoin relies on a sort of honour system, and is traded on the web.
According to the Bitcoin website, Bitcoin is free from the highs and lows of inflation, interest rates and market fluctuations, and its value is determined by the number of bitcoins in circulation. The total number of Bitcoins is capped at 21 million.
How does Bitcoin work?
According to the Bitcoin website, “Bitcoin is nothing more than a mobile app or computer program that provides a personal Bitcoin wallet and allows a user to send and receive bitcoins with them.”
Bitcoins are typically bought through an exchange. The process involves setting up an account, then transferring funds into the account in order to start buying bitcoins. Bitcoins can also be exchanged in physical form through the Casascius coin -- each is worth one digital Bitcoin.
Individuals can acquire bitcoins through:
Payment for goods and services
Purchasing them at a Bitcoin exchange
Exchanging bitcoins with other individuals
Earning bitcoins through competitive mining (a process whereby users create money through computing: users donate their computer power to Bitcoin so it can be used to solve complex mathematical problems required to validate transactions. When a problem is solved, bitcoins are issued).
The world’s first Bitcoin ATM went live in a downtown Vancouver shop in October, allowing people to exchange cash for the digital currency. Approximately 20 businesses in Vancouver now accept Bitcoin.
In November, British billionaire Sir Richard Branson’s commercial flight company Virgin Galactic announced it is now accepting the digital currency for its Virgin Galactic flights to space. And on Nov. 28, University of Nicosia, Cyprus’ largest private university said it will start accepting Bitcoin for tuition fees -- the first university to do so.
What are the advantages?
Efficiency: Money can be sent and received instantly anywhere in the world, at any time, without a bank or middleman.
Low fees: Payments are processed with either no fees or very small fees.
Privacy: Transactions do not contain users’ personal information, offering stronger protection against identity theft.
Control: Users are in full control of their transactions.
Transparency: All information on transactions is available in the database.
Howell obtained the bitcoins in 2009 for almost nothing. When he discarded his hard drive last July -- now buried in a Newport landfill the size of a soccer field -- the bitcoins were worth nearly $900,000.
Today, the value of one Bitcoin has soared to over $1,000.
Here are a few things to know about the virtual currency:
What is Bitcoin?
Bitcoin is a decentralized peer-to-peer digital currency and payment network. It is completely based on the belief that Bitcoin has value.
Hoss Gifford of OneMethod Inc. explains that “unlike traditional currencies, it’s not tied to any one country or any bank.”
“Unlike a traditional currency, it doesn’t have a reserve; there is no big vault underground somewhere with a lot of gold,” he says.
Instead, Bitcoin relies on a sort of honour system, and is traded on the web.
According to the Bitcoin website, Bitcoin is free from the highs and lows of inflation, interest rates and market fluctuations, and its value is determined by the number of bitcoins in circulation. The total number of Bitcoins is capped at 21 million.
How does Bitcoin work?
According to the Bitcoin website, “Bitcoin is nothing more than a mobile app or computer program that provides a personal Bitcoin wallet and allows a user to send and receive bitcoins with them.”
Bitcoins are typically bought through an exchange. The process involves setting up an account, then transferring funds into the account in order to start buying bitcoins. Bitcoins can also be exchanged in physical form through the Casascius coin -- each is worth one digital Bitcoin.
Individuals can acquire bitcoins through:
Payment for goods and services
Purchasing them at a Bitcoin exchange
Exchanging bitcoins with other individuals
Earning bitcoins through competitive mining (a process whereby users create money through computing: users donate their computer power to Bitcoin so it can be used to solve complex mathematical problems required to validate transactions. When a problem is solved, bitcoins are issued).
The world’s first Bitcoin ATM went live in a downtown Vancouver shop in October, allowing people to exchange cash for the digital currency. Approximately 20 businesses in Vancouver now accept Bitcoin.
In November, British billionaire Sir Richard Branson’s commercial flight company Virgin Galactic announced it is now accepting the digital currency for its Virgin Galactic flights to space. And on Nov. 28, University of Nicosia, Cyprus’ largest private university said it will start accepting Bitcoin for tuition fees -- the first university to do so.
What are the advantages?
Efficiency: Money can be sent and received instantly anywhere in the world, at any time, without a bank or middleman.
Low fees: Payments are processed with either no fees or very small fees.
Privacy: Transactions do not contain users’ personal information, offering stronger protection against identity theft.
Control: Users are in full control of their transactions.
Transparency: All information on transactions is available in the database.
Bitcoin breaks $1,000 barrier for first time
Bitcoin continued its stellar rally on Wednesday, breaking above $1,000 for the first time and marking a rise of over 7,600 percent so far this year.
Many analysts and investors have labeled bitcoin's unfettered rise a bubble, yet greater awareness of digital currencies and relief following last week's U.S. senate hearing have paved the way for fresh gains.
Getty Images
Bitcoin traded as high as $1,030 on the Mt. Gox exchange, up 7,661 percent year-to-date from its December 31 close of $13.27.
Digital currencies cleared a major hurdle when U.S. authorities signaled a willingness to accept them as legitimate payment alternatives at a November 18 U.S. Senate hearing on virtual currencies. The outcome allayed concerns that the government would take steps that could undercut mainstream adoption.
Many analysts and investors have labeled bitcoin's unfettered rise a bubble, yet greater awareness of digital currencies and relief following last week's U.S. senate hearing have paved the way for fresh gains.
Getty Images
Bitcoin traded as high as $1,030 on the Mt. Gox exchange, up 7,661 percent year-to-date from its December 31 close of $13.27.
Digital currencies cleared a major hurdle when U.S. authorities signaled a willingness to accept them as legitimate payment alternatives at a November 18 U.S. Senate hearing on virtual currencies. The outcome allayed concerns that the government would take steps that could undercut mainstream adoption.
n Vermont, Users of "Cryptocurrency" Bitcoin Are Few But Committed
Last week, in a small, subterranean workspace near downtown Burlington, a group of tech-savvy Vermonters held an open forum on a topic that’s attracted a great deal of attention lately: Bitcoin. Early adopters of the “cryptocurrency” believe it has the potential to upend the entire global economy.
Economic policy and the future of currency may seem like pretty dry subjects for a weekday evening meeting, but everyone in attendance was as enthusiastic as Sunday-afternoon football fans. Beers were drunk and slang was slung, even as the discussion turned to such topics as fiduciary decentralization and the effects of arbitrage on currency stability.
Those who are keen on Bitcoin are really keen on Bitcoin, and that includes several of the members of Laboratory B, the “community hackerspace” that hosted the discussion. Also in attendance at the event were a number of other locals who had personal or professional interests in Bitcoin.
It was clear that everyone present viewed Bitcoin as a “disruptive technology,” perhaps even the epitome of an internet-era game changer. If Bitcoin really takes hold — and it’s been showing signs of strength lately — then it has the potential to impact the economy at nearly every level, from buying a cup of coffee to reporting taxable income to facilitating international transactions.
Economic policy and the future of currency may seem like pretty dry subjects for a weekday evening meeting, but everyone in attendance was as enthusiastic as Sunday-afternoon football fans. Beers were drunk and slang was slung, even as the discussion turned to such topics as fiduciary decentralization and the effects of arbitrage on currency stability.
Those who are keen on Bitcoin are really keen on Bitcoin, and that includes several of the members of Laboratory B, the “community hackerspace” that hosted the discussion. Also in attendance at the event were a number of other locals who had personal or professional interests in Bitcoin.
It was clear that everyone present viewed Bitcoin as a “disruptive technology,” perhaps even the epitome of an internet-era game changer. If Bitcoin really takes hold — and it’s been showing signs of strength lately — then it has the potential to impact the economy at nearly every level, from buying a cup of coffee to reporting taxable income to facilitating international transactions.
CLAIM: Bitcoin Is Basically For Criminals
There is a great op-ed in the Baltimore Sun that argues Bitcoin is useful mostly for criminals. E.J. Fagan, the deputy communications director at Global Financial Integrity, a research organization dedicated to studying illicit financial flows, argues that the only people who really need completely anonymous financial transactions are criminals.
If you're a non-criminal, you don't need anonymous, untraceable financial transactions, Fagan says. Or you could use cash, which is still almost completely anonymous.
But criminals have a different problem when it comes to cash. Once your criminal business becomes successful, say from dealing drugs or running sex slaves or poaching rhinos, then the cash really starts to pile up. Although criminals in movies like to put cash into paper bags and fancy briefcases, this becomes very impractical, very quickly.
Criminals need banking services, basically.
But criminals hate banks, because banks tell things to the police. Bitcoin basically solves the banking problem for criminals, Fagan argues:
By largely eliminating intermediaries, bitcoin allows individuals to conduct transactions without being subject to anti-money laundering controls, which makes it an attractive currency to criminals — particularly those who prey on the weak.
... Criminals need bank accounts, cross-border transactions, and — mostly importantly — anonymity, to execute large-scale transnational crime. Bitcoins essentially allow criminals to make peer-to-peer cash transactions at enormous scale.
... [Anonymous online currencies is] help criminals launder massive amounts of money. More girls will be sold as sex slaves, more rhinos will be poached, and every other large-scale transnational crime that you can name is going to become a lot easier if criminals have a way to transfer very large amounts of money completely anonymously.
There is anecdotal evidence to back this up. The Bitcoin exchange market has become rife with hackers and "bank" robbers. And Ross Ulbricht, the alleged master of the Silk Road market for criminals, amassed a fortune of $20 million in Bitcoin, which he was using to pay hit men to assassinate his enemies, prosecutors claim.
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If you're a non-criminal, you don't need anonymous, untraceable financial transactions, Fagan says. Or you could use cash, which is still almost completely anonymous.
But criminals have a different problem when it comes to cash. Once your criminal business becomes successful, say from dealing drugs or running sex slaves or poaching rhinos, then the cash really starts to pile up. Although criminals in movies like to put cash into paper bags and fancy briefcases, this becomes very impractical, very quickly.
Criminals need banking services, basically.
But criminals hate banks, because banks tell things to the police. Bitcoin basically solves the banking problem for criminals, Fagan argues:
By largely eliminating intermediaries, bitcoin allows individuals to conduct transactions without being subject to anti-money laundering controls, which makes it an attractive currency to criminals — particularly those who prey on the weak.
... Criminals need bank accounts, cross-border transactions, and — mostly importantly — anonymity, to execute large-scale transnational crime. Bitcoins essentially allow criminals to make peer-to-peer cash transactions at enormous scale.
... [Anonymous online currencies is] help criminals launder massive amounts of money. More girls will be sold as sex slaves, more rhinos will be poached, and every other large-scale transnational crime that you can name is going to become a lot easier if criminals have a way to transfer very large amounts of money completely anonymously.
There is anecdotal evidence to back this up. The Bitcoin exchange market has become rife with hackers and "bank" robbers. And Ross Ulbricht, the alleged master of the Silk Road market for criminals, amassed a fortune of $20 million in Bitcoin, which he was using to pay hit men to assassinate his enemies, prosecutors claim.
cXsP9
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