Virtual currency – Will it replace the Bank?
Bitcoin has recently made an appearance in the technological world. Rick Falkvinge, an entrepreneur from Sweden has invested all that he is worth into his latest business venture.
Bitcoin is an online currency, with which users can transfer money over an internet connection. It completely reinvents the banking system. Users are not assigned a bank account. Instead a “Bitcoin Address” is provided.
The money is not stored on the cloud, nor is it stored in a bank; instead it is stored in a file on your computer. You own the money, holding complete responsibility for what you do with this money. Other people could access this money if they had the file, so it’s very important that this file is secure. Trying to tamper with this file will cause you to lose all of your money.
So what are the benefits of Bitcoin? Firstly, there is no transfer or handling fee. Secondly transactions can be completed instantly, at any time. You can do this at three o’clock am on a Sunday if you wished to do so. In addition, no taxes are implemented on transactions. This means that money can be transferred in a similar way that you would give someone a five pound note in person.