For most people, bitcoin is just a means of payment. However, it has the potential to become more than just a cryptocurrency.
Bitcoin is here to stay. Despite some negative events occurred in the bitcoin industry, including MtGox hacker attack and Silk Road shutdown, the digital currency continues growing.
Besides bitcoin, other digital currencies have been developed, with peercoin and litecoin being the most notable ones.
Until today, over 60,000 businesses have already integrated the digital currency and the overall investments in bitcoin surged by 28% in Q2 from Q1.
“Bitcoin is a token, a currency, but that’s not all it is. That’s the first of many many applications of this blockchain technology,” said bitcoin developer Jeff Garzik. “[Currency] is not the killer app, it’s just the first app.”
One of Reddit users wrote: “Bitcoin and Circle just solved my remittance problem. I live in Belarus, people. I receive my salary here, in a local bank account tied to a debit card in U.S. dollars. One of my big problems is transferring my salary back to my U.S. account with minimal fees so that I can make payments on student loans and such.”
“With Circle, I can now send any amount of money to my Coinbase account to be withdrawn to my local bank account with negligible transaction fees. This is a game changer, folks. I don’t care if bitcoin’s value drops to $0.10; it’s now the only way I’m going to be transferring money,” he added.
Bitcoin is based on a decentralized blockchain technology which makes it almost the most secure cryptocurrency. The technology records information on every verified transaction and stores it on an immutable time-stamped list, which is then replicated on other servers worldwide.
TechCrunch columnist Jon Evans said: “The ‘blockchain’ — the engine on which Bitcoin is built — is a new kind of distributed consensus system that allows transactions, or other data, to be securely stored and verified without any centralized authority at all, because (to grossly oversimplify) they are validated by the entire network. Those transactions don’t have to be financial; that data doesn’t have to be money. The engine that powers bitcoin can be used for a whole array of other applications.”
Russia is currently considering the possibility of prohibiting bitcoin usage in 2015. If the planned ban comes in force, the country will become the third country to try to prohibit digital currency after Ecuador and Bolivia.
Moreover, the digital currencies are likely to gain more importance in the upcoming years, given the increase in online shopping.