Bitcoins - Global Impact of Virtual Currencies
Bitcoin is really a payment system invented by Satoshi Nakamoto who released it in 2009 as an open-source software. Claims to the identity of Nakamoto have never been verified, however the Bitcoin has progressed from obscurity to the largest of its kind, an electronic digital asset now being called the'cryptocurrency '.
The most significant characteristic of Bitcoin is that unlike conventional and traditional printed currency, it is an electric payment system that is dependant on mathematical proof. Traditional currencies have centralized banking systems that control them and in the lack of any single institution controlling it, the US Treasury has termed the Bitcoin a'decentralized virtual currency '. The underlying idea behind Bitcoin was to produce a currency entirely independent of any central authority and one that could be transferred electronically and instantly with almost nil transaction fees.
By the end of 2015, the number of merchant traders accepting Bitcoin payments for products and services exceeded 100,000. Major banking and financial regulatory authorities including the European Banking Authority for example have warned that users of Bitcoin aren't protected by chargeback or refund rights, although financial experts in major financial centers accept that Bitcoin can offer legitimate and valid financial services. On one other hand, the increasing use of Bitcoin by criminals has been cited by legislative authorities, police agencies and financial regulators as a major reason for concern.
Who owns Bitcoin voucher service Azteco, Akin Fernandez comments that there may shortly be an important game-changer in the manner Bitcoin is generated. The rate of Bitcoin generation every day will soon be literally'halved'and this may alter the perception of Bitcoin completely, although it will be nearly impossible to predict how the general public at large and the merchants will respond to this type of move.
Against the backdrop of such a move, the predictions are that the transaction level of Bitcoin is set to triple this year riding on the back of a probable Donald Trump presidency. Some market commentators are of the view that the price of the digital currency could spike in case of this type of possibility leading to promote turmoil globally.
The Panama Papers scandal which broke out in May this year has spurred the European Union to fight tax avoidance strategies that the rich and powerful use to stash wealth by bringing in new rules. The present rules seek to close the loopholes and on the list of measures proposed are efforts to end anonymous trading on virtual currency platforms like Bitcoin. Far more research must be done by the European Banking Authority and the European Central Bank on the best strategies to manage digital currencies as currently there is no EU legislation governing them.