I’m late to the party on this one, but I still wanted to say a few words about it just because I am oh so fond of anything and everything challenging, novel, and, best of all, subversive. Cryptocurrency, for those folks who are also late to the party, is a form of digital currency that is created by maintaining a block-chain. This currency, like all currency, is valuable insofar as it is given value by its users. If all the users were to, one day, give up on Bitcoin, its value would plummet and what little Bitcoin remained would collect cyber-dust.
Now all of that may have sounded like gibberish, but it's true, even if you don't understand it. Bitcoin is one of the most famous peer-to-peer, decentralized cryptocurrencies on the market. Notice how I didn't say electronic currency. The difference between a cryptocurrency and an electronic currency is how they are generated. Cryptocurrency is created by maintaining what is known as a block-chain, which is a publicly distributed ledger mapping all Bitcoin transactions. Generally, there are two ways to get Bitcoins. The first way is likely the most popular which is to mine Bitcoins. Mining Bitcoins involves the user offering some of their computing power to help maintain the public ledger, called mining the block-chain. For offering their computing power, the user is rewarded with Bitcoin transaction fees and newly minted Bitcoins. The second way to obtain Bitcoins is to trade for them. Today, you can trade services, products, and even money for Bitcoins and, then, use those Bitcoins to trade for other goods or services. Bitcoin has picked up quite a bit of steam over the years. It was first introduced in 2009 and its price, per Bitcoin, has fluctuated anywhere from a few cents per BTC (Bitcoin) to around $1000 per coin.
But why is BTC so popular? Well, it's a fascinating concept made into a viable, alternative currency. Think about it. All a person would need to do to make money is to mine BTC, which requires no extra effort on the part of the individual. It's a completely autopilot way to make money. A dream come true for most people.* Additionally, many people treat BTC as a stock or commodity that may be sold once its price reaches a certain level. It seems the chance for profit is BTC's most alluring feature. But there is more to it. BTC is also hard to track and trace, which makes it an ideal currency to use in purchasing of illegal goods and services. I imagine it has its uses in money-laundering as well. And, additionally still, BTC has become known as "the people's currency" given its decentralized nature. No single entity or institution can directly manipulate its price or distribution. Which can mean increased stability and chances of success. BTC just seems fair by nature.
And let us not forget that BTC is an alternative currency. There's something about the word alternative that is just so damn irresistible. Alternative says one thing, and one thing alone: choice. People can choose it over any other form of currency, if they so desire. Choices are something people just love. Which is just another reason to love Bitcoin.
Now, mining the block-chain and speculating in BTC is all well and good, but I suspect cryptocurrency's biggest impact will be in the anonymity it offers its users. Few things can be said to be anonymous, today, especially something as useful as a currency. In a world filled with an increasing number of peeping eyes and lurking spooks, a currency that offers some form of anonymity seems like a God-send. Well, Bitcoin is just that, a God-send. Granted, it doesn't offer perfect anonymity, nothing does, but it's still far more anonymous and private than most other currencies.
If you live in the United States, then you know that a great deal of peeping goes on, and that there is a great number of banned products. I don't expect the U.S. to become any freer any time soon, so it seems BTC has quite an important role to play, today and tomorrow.
My only regret about Bitcoin is that I didn't buy any when it was selling at a few pennies per coin. If I had, I wouldn't have to ask for donations. *hint hint*
And in addition to all of the aforementioned points (just because I enjoy piling things upon things), electronic currency is one of the hallmarks of cyberpunk fiction. The fact that BTC is not an electronic currency but a currency generated by means of a cryptographic algorithm is one of the most cyberpunk things I could imagine. The advent of crytpocurrency is one huge step into the future.
*This is once again only a dream. BTC mining is still possible, but the profitability is next to null. Unless, of course, you have access to thousands of servers. Even then, the cost of maintaining and powering those servers would render any and all profit non-existent.
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