For the first part of this post, I discussed a quick backstory of what bitcoin is, who started the first and most famous digital cryptocurrency, what you can do with it and who are its staunch supporters and skeptics.
For the second and last part of this two-part, opinion-free bitcoin facts, I’ll discuss additional frequently asked questions about it.
6. Is all of this legal?
Bitcoin has been hugging the headlines in 2017 due to the rise in the value of this cryptocurrency – breaking the $1,000 threshold for the first time in January 1, before ascending to nearly $19,000 this December, according to Coinbase.
So the next question for someone who are curious to know more about it is its legality. The short answer is – yes, for now. As long as you don’t do illegal transactions with it – just like any currency – it is legal. The one instance when it figured negatively was when bitcoin was used in Silk Road, the dark Web marketplace for drugs and illicit goods and services. The FBI shuttered the illegal online platform in 2013 and took over bitcoin wallets controlled by the site, where one of which held 144,000 bitcoins.
As bitcoin attracts more mainstream attention, there will be increased scrutinity of its legality. So even if it is legal to buy and sell Bitcoin, miners and exchanges occupy a gray area that seems vulnerable to future regulation and law enforcement action.
7. A Multi-Million Setback
Bitcoin reportedly shed a devastating loss after the alleged hacking of the Japanese exchange – Mt. Gox. When computed in 2014 value, there were about $460 million of the currency stolen.
Such large loss raised concerns about how secure the digital currency was.
8. Notable Investors
Harvard-educated twins Cameron and Tyler Winklevoss (who sued Mark Zuckerberg for alleging that their idea was used for the founding of Facebook) are among its notable investors. They bought $11 million worth of Bitcoin in 2013. The twins were now declared the first Bitcoin billionaires and were petitioning for the SEC to create a bitcoin exchange traded fund. But the SEC earlier this year rejected the idea.
Another notable investor is entrepreneur Erik Finman, whose $1,000 investment into Bitcoin when he was 14 years old made him a millionaire.
9. Celebrities Want in and Cash In
Hollywood stars who expressed enthusiasm for the cryptocurrency include Academy Award winner Gwyneth Paltrow, celebrity hearthrob Ashton Kutcher, and boxing champ Floyd Mayweather have all invested in Bitcoin startups. Paltrow advises Abra, a Bitcoin wallet.
10. Big Financial Institution Push
The biggest support came from Fidelity Investments, which in August 2017 came forward to embrace Bitcoin and other cryptocurrencies. Clients of the company can use their website to view their bitcoin holdings held through digital wallet provider Coinbase.
11. More Than a Thousand Cryptocurrencies
There are reportedly more than a thousand cryptocurrency existing today, with more sprouting up every day. Bitcoin, which is the real progenitor of them all, is just among other well-known alternative currencies which include Ethereum, Ripple, and Litecoin.
12. Publicly Traded
Did you know that there is another way to invest in Bitcoin without possessing some of the digital currency? On December 10 this year, Bitcoin futures – “financial contracts obligating the buyer to purchase an asset or the seller to sell an asset,” became available on Cboe, a Chicago exchange, according to Investopedia.
What does this mean for the future of Bitcoin?, you may ask. Some argue that it will help stabilize the cryptocurrency’s wild price fluctuations.
13. A Hard Fork
A few issues, including the limited number of transactions that can be processed per second, led to Bitcoin experience what’s beeing called a “hard fork”. This in essence resulted in the cryptocurrency splitting into two, with Bitcoin Cash debuting.
PCMag’s Rob Marvin explains the situation, as thus: “The Bitcoin fork speaks to a fundamental ideological rift over what’s more important: preserving the decentralized nature and independent control of the Bitcoin network, or accelerating transaction speeds to make the cryptocurrency more viable for mainstream ecommerce and payments.”
Entrepreneur.com states Bitcoin Cash allows larger blocks of currency and more transactions per second.
Just 13 facts are obviously not enough to cover everything there is to know about Bitcoin. In the meantime, head over to Bitcoin.org for some introductory information.