On Monday, Bitcoin soared to record highs reaching a peak of $3423.37. It has since then also touched the $3500 mark. The crypto-currency has been a dream for speculators because of its historically extreme volatility. Gaining traction since five years, it has blessed its loyal supporters who have invested in the virtual currency in its not so fortunate days.
Investors who bought $1000 worth of Bitcoin in 2010 are now millionaires. Its creator, Satoshi Nakmoto, who remains mysterious to this day, might very well end up revolutionising the increasingly redundant and problem ridden traditional monetary system.
For the uninformed, Bitcoin is a crypto-currency that was released in 2009. The purpose was to facilitate transactions in a secure and anonymous manner, free from government or bank involvement. The idea was slow to catch on initially but after support from governments and corporations alike, it has slowly shed the scepticism attached to it. Bitcoin was initially assailed for being the payment of choice for illegal and black market transactions.
Times have changed and countries including America, Canada, and Japan all have allowed transactions through Bitcoin. In April Japan officially recognised Bitcoin as legal currency with many businesses accepting it as a payment method.
However, there has been increasing contention amongst developers and businesses over the methodology applied to boosting the virtual currency’s trading capacity and transaction speed. This has recently led to a split within the currency with the new Bitcoin Cash splitting into a different blockchain last week.
Think of a blockchain as a public ledger of all Bitcoin transactions that have ever been executed. The majority of the bitcoin community supports a solution called SegWit2x while the splinter group has come out with Bitcoin Cash which has not really taken off.
There are approximately 16.5 million bitcoins in circulation as of yesterday with a market capitalisation of $55.5 billion. Yet experts believe the potential has barely been tapped and the meteoric rise is just a preview of the things to come.
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