Is the Bitcoin an Alternative to
Recently there has been a lot of talk about a new
virtual currency called the Bitcoin that is growing
very rapidly, its gaining a lot of media attention and
its value has increased dramatically.
The current financial turmoil in Europe and around the
world has also made people invest in alternatives to
fiat currency such as the Bitcoin. For most people it
is strange that someone can take seriously a
currency that is not backed by a Government or
central institution, but that is the precise advantage
of this coin.
Bitcoin developers spoke to the Guardian's James
Ball at their home in central London and these were
some of their comments:
''Bitcoin is a virtual currency just like dollars, pounds, euros but at
the same time we have a type of currency that isn't control by
central institutions, its completely decentralized. I can send
money to whoever I want, whenever I want, wherever I want in
the world and no one can stop me.''
The Bitcoin is a very interesting concept that is
gaining acceptance by many companies on the
internet like PayPal, WordPress, Reddit,
Microtronix and many others. In fact ATM
machines are already on the way to be used.
Some of the critics of Bitcoins say that they are
facilitating buying drugs on the internet, the
developers say that the virtual currency is just a
tool and you can use it for good or bad.
Fiat currency has the disadvantage that central
institutions can print as much as they want, therefore
it is always losing purchasing power. The same
principle applies if you have money in the bank.
Instead what you should do is put your money on an
asset that keeps its value or increase it.
At this moment the Bitcoin seems a good option
because its increasing its value, however this can
change in the future. Another alternative is to invest
your money on something productive like a business
or land that increases in value or invest it in gold.
Even though the virtual currency is a good way
to diversify your portfolio and not depend on
paper money or bank deposits, you need to
look for a way to store value that is secure
against financial hedge and the best option is
Gold, because its the ultimate money. Gold
has been a store of value for centuries and
will always be, because its valuable, its
limited in quantity, its easy exchangeable and
its a store of value.