Bitcoin global virtual currency hits $1000 ( what is Bitcoin?)
Bitcoin is a new word doing the rounds. Unlike physical currency in the form of notes and coins, it is a virtual currency which is equivalent to cash on the internet. The value of bitcoin is determined by its utility to the people, its availability and demand.
While several Bitcoin exchanges are set up all around the world, MTGox is the most prominent. The price of a bitcoin has climbed higher than ever to a massive $1,000 on this exchange. There currently exists about 11 million bitcoins and hence the total market of this currency is worth an amount of $11.4 billion.
In this year, bitcoin has fared well as only in January it was worth under $20. In the month of October when the FBI closed down Silk Road, bitcoin was brought into the limelight as it was the main medium of exchange used there. Silk Road was an online drugs marketplace. However, over time people have begun to use it for other legitimate purchases.
Recently, in a US Senate hearing, the officials from the administration of Barack Obama gave it a stamp of respectability by recognising its potential. Users say it is an extremely efficient way of dealing with global money transfers for which there is no favoured system yet. It has also become popular due to the fact that it makes the tracing of transactions difficult. Its popularity can be judged by the fact that its value has risen from zero to $1,000 in merely five years.
Bitcoin global virtual currency hits $1000