Bitcoin is a cryptocurrency and worldwide payment system. It is the first decentralized digital currency, as the system works without a central bank or single administrator. The network is peer-to-peer and transactions take place between users directly, without an intermediary. These transactions are verified by network nodes through the use of cryptography and recorded in a public distributed ledger called a blockchain. Bitcoin was invented by an unknown person or group of people under the name Satoshi Nakamoto and released as open-source software in 2009.
The current price of one bitcoin today is 8024.95 US Dollar but when bitcoin first came out around 2009, it was of no value at all. No exchanges or market, users were mainly cryptography fans who were sending bitcoins for hobby purposes representing low or no value. In March 2010, user “SmokeTooMuch” auctioned 10,000 BTC for $50 (cumulatively), but no buyer was found. One Bitcoin was valued at
less than $0.01 on March 2010. On 22 May 2010, Laszlo Hanyecz made the first real-world transaction by buying two pizzas in Jacksonville, Florida for 10,000 BTC.
By April 2011, Bitcoin took parity with US dollar. Around this time a teenager named Erik Finman invested the cash gift from his grandmother into Bitcoins which made him a millionaire after its exponential growth.
“Whenever I sell a little bit of bitcoin, or pay for something in bitcoin, I multiply that price by ten, because that’s where I think that bitcoin’s going,” Finman said on CNBC’s “Closing Bell.” “I think it’s going to be huge, and I think its going to be incredible, so I try not to take out any.”
Kristoffer Koch spent $27 to buy 5,000 bitcoins.while writing a thesis on encryption which is now worth $886,000. The list goes on and on.
Big Banks want to destroy Bitcoin before it destroys them. It challenges their monopoly which we ourselves have been fueling since time immemorial. Who are we to blame? Even propagating against the evils of capitalism and consumerism, one tends to indulge in it. One tends to avouch it as means of climbing the social ladder, means of livlihood, even decency. In a world where corruption and prostitution is normal, infanticide and genocide are fundamental rights, mass murderers are hailed as heroes, where eulogies are sung for pedophiles, lechery is hailed as religion, materialistic tendencies provide one with dreamscape.
Bitcoin, the “people’s currency,” has the potential to become a new currency, free of the control of big governments and big banks.
That’s why they both want to limit this potential. Each one in their own way. Big governments by stepping up regulations of Initial Coin Offerings (ICOs) and by shutting down cryptocurrency exchanges, as the Chinese government has announced recently, crushing cryptocurrencies. Bitcoin heralds a new age more disruptive than that of today’s Internet. Disruption can be a good thing, especially when it affects banking, a failing set of business models which, for all the tweaks, have been virtually unchanged for millennia.
Various journalists,economists, and the central bank of Estonia have voiced concerns that bitcoin is a Ponzi scheme. A 2014 report by the World Bank concluded that bitcoin was not a deliberate Ponzi scheme. The Swiss Federal Council examined the concerns that bitcoin might be a pyramid scheme; it concluded that “Since in the case of bitcoin the typical promises of profits are lacking, it cannot be assumed that bitcoin is a pyramid scheme.”