November 30th, 2013 → 9:17 pm @ Bitcoin Unveiled
In a mere two months, the price of one Bitcoin has skyrocketed from about $100 to now $1200. When looking at the chart below, you can see the amazing growth, increasing at an exponential rate. So what is causing the increase in price?
1.) Media coverage: Every, and I mean literally every, news website, television program, and blog has started writing about Bitcoin. It is a phenomenon and people who aren’t necessarily excited about e-currencies are now excited due to Bitcoin’s growth.
2.) China’s acceptance of the currency: In the second half of October, Baidu announced its acceptance of Bitcoin to pay for its services. For those of you who don’t know what Baidu is, it is considered the “Google” of China. Being one of, if the not the most, viewed websites in China, the awareness of Bitcoin in China has spiked, causing a new market in Asia for Bitcoin to emerge.
3.) The greater fool theory: With all this growth, press has pumped the value of Bitcoin to all time highs. Although I am not saying the currency is going to crash, I believe many people are currently entering the market without much knowledge of what Bitcoin actually is. They see the amazing returns early investors have generated, and they would like to capitalize on the growth as well. With increased demand with new investors entering the market, price have risen greatly.
August 14th, 2013 → 7:20 pm @ Bitcoin Unveiled
Recently, I blogged about Bitcoin Web Hosting, a hosting company that allows payment in Bitcoin. I thought they had a great idea because it was the first time ever that you could operate a website with the anonymity provided by Bitcoin. As my luck would have it, they reached out to me with an opportunity to promote my book in a giveaway contest they are hosting to celebrate the recent opening of their company.
In addition to my book, they will be raffling off a bunch of other goodies, such as web hosting, domain names, and Bitcoins. Take a minute to sign up at http://bitcoinwebhosting.net/win-bitcoins-sweepstakes. The final time to enter is September 15th at midnight. Good luck!
August 1st, 2013 → 10:26 pm @ Bitcoin Unveiled
Yesterday, The Bank of Thailand declared Bitcoin illegal. Yes, you heard me… ILLEGAL!
The bank contacted Bitcoin Co. Ltd. (bitcoin.co.th) and advised them to halt trading. Here is a clip from Bitcoin Co. Ltd’s website.
At the conclusion of the meeting senior members of the Foreign Exchange Administration and Policy Department advised that due to lack of existing applicable laws, capital controls and the fact that Bitcoin straddles multiple financial facets the following Bitcoin activities are illegal in Thailand: Buying Bitcoins, Selling Bitcoins, Buying any goods or services in exchange for Bitcoins Selling any goods or services for Bitcoins, Sending Bitcoins to anyone located outside of Thailand,Receiving Bitcoins from anyone located outside of Thailand.
Of course, this sounds really, really bad. However, we first must examine the jurisdiction of the Bank of Thailand and ask ourselves, “can they really ban Bitcoin?”
The simple answer is no. The Bank is not responsible for creating law, this job actually falls upon the Ministry of Finance. Also, because Bitcoin is not a foreign currency, current regulatory law has not been defined to encompass Bitcoin. For those of you interested in the technical jargon, read below.
The furthest the Bank of Thailand’s authority reaches in relation to foreign exchange media is stated in the Exchange Control Act (B.E. 2485) and Ministerial Regulation No. 13 (B.E. 2497) of that act. The language actually seems favorable towards Bitcoin if it were to fall under the definition of a foreign currency in Thailand. “Foreign currencies can be transferred or brought into Thailand without limit” but need to be deposited “with an authorized bank within 360 days of receipt”, and amounts “exceeding USD 20,000 or its equivalent must declare to a customs officer”. It seems that confusion may have arisen particularly over whether Bitcoin.co.th was authorized to conduct a foreign exchange business, because “[a]ny transactions not conducted through the above-mentioned licensees require approval from the Competent Officer on a case by case basis.” (source: btcglobal.net)
Although The Bank of Thailand’s advisement is certainly not good news for Bitcoin, you can rest assured that Bitcoin is not illegal in Thailand.
July 3rd, 2013 → 6:05 am @ Bitcoin Unveiled
The Winklevoss Twins, infamous for their role in the creation of Facebook, have filed with the United State’s securities regulators to open a Bitcoin fund that would be similar to buying a Gold ETF. For Bitcoin, this is a huge deal.
Currently, there is no simple way to buy and sell Bitcoins online. A person must create an account on a Bitcoin Exchange. Next, they must fund this account with a bank account. By the time the person is able to actually purchase and sell Bitcoins, it has been several days, making it a non-liquid investment for traders looking to hold short-term. Increased exposure to trading (and therefore exposing Bitcoin to more people) will result in potential rises in value for Bitcoin.
Second, and possibly an even larger deal, is that IF (and that’s a huge if) the Bitcoin fund goes through, THE US GOVERNMENT IS OPENLY RECOGNIZING BITCOIN. By allowing people to buy into Bitcoin on a public stock exchange, the government is essentially acknowledging that Bitcoin is legitimate. Many critics of Bitcoin have stated that, if the government decides to outlaw Bitcoin, the currency would crash. By having securities regulators accept a Bitcoin Fund, the chances that the United States will outlaw Bitcoin diminish greatly. Skeptics of Bitcoin will have one less reason to doubt the currency and this will help to counter some of the harmful myths that surround Bitcoin.
However, what are the chances the Bitcoin Fund will become a reality? In my opinion, I think there is certainly a decent chance. This is an opportunity for the government to regulate and place boundaries on Bitcoin. For owners of Bitcoin, this could mean more stability. For the government, this could make it easier to collect taxes and protect their interests as Bitcoin gains popularity.
Source: NY Times
photo credit: zcopley
June 22nd, 2013 → 11:35 pm @ Bitcoin Unveiled
When Bitcoin was first created in 2008, there were no businesses accepting the currency. Although this may have been true up until a year or even 6 months ago, things have changed. Many online and physical businesses accept Bitcoin. Of all the things we could find, here are 5 things you didn’t know Bitcoin can buy…
1. Web Hosting
Believe it or not, you can purchase web hosting with your Bitcoins. I stumbled upon bitcoinwebhosting.net and was very impressed by what they have to offer.
So you are looking to satisfy your sweet tooth? You can purchase cupcakes at the Cups and Cakes Bakery in San Francisco.
June 21st, 2013 → 8:04 am @ Bitcoin Unveiled
With more and more news sources reporting on Bitcoin, there have been many misconceptions and rumors flying around. Here are the top 10 myths about Bitcoin.
1. There is an infinite amount of Bitcoins
A clear misconception. Bitcoin was created so that only 21 million Bitcoins will ever be produced. Over time, the individual value of each Bitcoin is supposed to increase as demand increases and supply stays constant (or even decreases) over time.
2. Bitcoin is insured
Another myth… Because Bitcoin is not regulated by any government, no insurance has been offered to Bitcoin holders. If you lose your Bitcoins (maybe you lose your wallet or send them to a scammer), there is no way to get them back! It is important to be careful with your Bitcoins!