Thursday, November 13, 2014

Why you’ll finally be using bitcoin soon


Published: Nov 12, 2014 2:18 p.m. ET
 
 

The digital currency saves time and money when shopping and transferring money

By

JURICADUJMOVIC

COLUMNIST
AFP/Getty Images
Bitcoin is used as a currency in some stores, even though it doesn’t have the backing of a central bank or government.
Bitcoin has come a long way, from a mysterious and controversial crypto-currency to a widely known medium of exchange.
Although faced with occasional challenges (such as the MtGox bitcoin heist, Silk Road incident or China’s regulatory stance), the bitcoin community remains unshaken, showing a surprising amount of resilience and trust in the digital currency.
As time passed, many new altcoin variants (alternatives to bitcoin) have sprung to life, the most notable of which are Litecoin and Peercoin. Litecoin is advertised as faster and more efficient, and Peercoin uses the concept of proof-of-stake, which means you gain Peercoins based on the amount of the currency you hold and not on your computer’s processing power, as is the case with bitcoin.
Bitcoin this year gained enough momentum to become a market-disrupting force. More than 60,000 businesses now accept the currency (Dish Network DISH, +0.05% joined in August), and the value of venture-capital investments made in bitcoin jumped 28% in the second quarter from the first quarter.
So what will be the trends, and challenges, in the years ahead?
Bitcoin may become a new “Western Union”: This is what one Reddit user said:
“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“With Circle, I can now send any amount of money to my Coinbase account to be withdrawn to my local bank account with negligible transaction fees.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.”
Alternative currencies are disrupting the way money transfer is handled worldwide. With services like Circle, money transfers are now becoming instant, secure and free — as they should be.
Big companies are signing on: There are already plenty of large companies to spend your hard-earned bitcoin on, like Newegg, Amazon.com AMZN, +0.21% and TigerDirect, to name a few. The world is slowly warming up to the concept of digital currencies much faster with big players helping the transition.
Bitcoin is changing the way we shop: As foreign exchange gains a digital dimension, we can expect shopping to do the same. That means fewer brick-and-mortar stores. Thanks to digital currencies, payments will become invisible and hassle-free.
Regulatory climate warms up: While China is quietly warming up to bitcoin after initially being wary, Russia is openly considering a ban by 2015. That would make it the third country to try to ban bitcoin after Ecuador and Bolivia.
Still, there are many countries that accept bitcoin. As the world gets more connected and online international trade increases, it’s my belief that repressive measures will slowly recede.
Blockchain (r)evolution: What is blockchain? To use conventional banking as an analogy, the blockchain can be compared to a list of banking transactions. However, it is much more than that.
Jon Evans from TechCrunch explains:
“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.”
One such (awesome) example is Maidsafe, a Scottish company with a brilliant idea to use its own technology of decentralized consensus, much like blockchain, to create a version of the Internet — safe from hackers and prying government eyes, but good enough for developers and for sharing information.
In spite of the turmoil, things are looking up for digital currencies. With the new year around the corner, it will be interesting to see what the future brings. Maybe your 2015 Christmas stockings will be filled with bitcoin-purchased gadgets?

JURICADUJMOVIC

Jurica Dujmovic is a business publisher, consultant, designer and gamer.
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Please let me know what you think of bitcoin and other alternative currencies
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Gald to see bitcoin continue to strive, specially after the tough year. Let's see whether they continue to grow and gain acceptance.

I wonder what it could mean for the U.S dollar if bitcoin gets bigger.
No mention of Dogecoin which I believe is the third most successful altcoin, IMHO that's one to seriously watch as it's backed by kids,online gamers and computer techs (lets face it the guys with the ideas)  as well as having a massive online community not to mention the transaction costs which seem to be so over mentioned in this article .
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