The Bitcoin Blog

Bitcoin, still a financial technology in its infancy in terms of adoption, can seem mystical to some. Blockchain technology is unlike any other system currently powering currency, and as such is not properly understood by the public at large. To many, especially of the older generations, cryptocurrency can seem like magic, a trick of digital sorcery, and certainly not something upon which one would place their trust and life savings. To aid in the understanding of cryptocurrency, I will attempt to explain Bitcoin through the allegory of a pre-electricity village, without referencing any modern technology. Decentralized transaction records Our hypothetical village has no centralized currency, and instead employs a simple barter system. The villagers, tired of the inefficiency of simple barter, but wary of a central bank issuing currency, adopt a decentralized accounting system around units of measurement called VillageCoin, and write down all transfers in a public led...

With increasing adoption of internet-banking and mobile-banking, an extensive network of branches is no longer necessary for banks. Are bank branches headed for extinction? Changing Face of Banking Change is inevitable. Before the invention of ATMs, the teller was an important person at the bank. Now verifying your account balance, counting your money and handing it to you is done by machines. Machines do this more quickly, more accurately and at a lower cost compared to your tellers. A similar paradigm shift seems to be happening within bank branches. Increased adoption of internet-banking and mobile-banking have reduced the competitive advantage that an extensive network of branches can provide. The South Korean Example Banks are risk averse and typically slower than firms in other sectors when implementing new technology. However, nothing can stop the march of technology, resulting in changes to how firms across the world, including banks, conduct business. Acc...

Genesis Mining, the eco-friendly Bitcoin cloud mining provider, has launched Enigma, the world's largest ether cloud mining farm. Ether (ETH) is the native token of the Ethereum decentralised computing system, and is used to power applications on the Ethereum blockchain. Unlike Bitcoin which uses proof-of-work (PoW) to mine coins, Ethereum will ultimately move to proof-of-stake (PoS), where validators on the network pledge security deposits of currency to ensure consensus. In the meantime ether is mined using GPU cards, rather than specialised ASIC chips, as is the case with Bitcoin. Marco Streng, CEO, Genesis Mining told IBTimes: "Our ether mining offering is for one year time frame and the shift from PoW to PoS is currently expected to be in around one year or later. "If the full year is not yet over and the switch happens before, the computing power of the cards will be used to mine other promising cryptocurrencies with it." Ethereum recently rele...

A recent hike in prices of petroleum products in Nigeria may increase Bitcoin adoption for cross border transactions and other uses such as for safekeeping and investments. Compounded by rising foreign exchange rates for imports, the hike is likely to have a transparent effect on inflation which already hit a 46-month high of 12.8% in March. Bitcoin adoption grows There has been a growing level of Bitcoin adoption in Africa's largest economy of late though. The level of awareness about the digital currency’s uses have improved particularly for trading and online purchases. It would seem more handy now that the disparity between the exchange rates of foreign currencies such as the US dollar to the naira has widened. The rates charged by traditional financial institutions have not been helpful. As of Friday May 13, Western Union calculates its exchange rate for a US dollar to be 197 naira - that’s excluding the transfer charge. Whereas in the parallel market, the rate Is...

Werner van Rooyen, head of Business Development and Growth at Bitx, one of Africa’s biggest Bitcoin exchanges, spoke to CoinTelegraph about the problems and potential of Bitcoin in Africa. CoinTelegraph: Bitcoin use in Africa has improved in the last couple of years. What has really changed? Werner van Rooyen: Bitcoin, as measured in the amount of transactions per day, is steadily rising in Africa as it is in the rest of the world. Trading between local currencies and Bitcoin is higher today than it had been a few years back and there’s a big increase in Bitcoin awareness and discussion, both by governments and consumers. CT: South Africa, Kenya and Nigeria are the three main markets for the virtual currency in Africa. Do you think the distribution pattern will remain the same for a long time or something is likely to change very soon? WR: I don’t see this changing anytime soon. Hurdles ahead CT: There is so much talk about how Africa is likely to benefit from Bit...

A recent survey by The Zimbabwe Standard has shown that a number of banks in the central business district of the country’s capital, Harare, has long queues to withdraw cash with others running out of cash by midday. This demand for cash is fuelled by a lack of trust in an impending introduction of bond notes by the apex Reserve Bank of Zimbabwe. Although its governor John Mangudya says the bond notes would not happen within two months, the latest development better highlights the growing need for a cryptocurrency like Bitcoin as a dependable option for users. Why Zimbabwe banks lack credibility This lingering cash crisis and its attendant challenges have reportedly drawn the attention of illegal foreign exchange dealers into the country to do fast business. In other cases, some bank staff allegedly take the advantage to charge clients up to 10% ‘commission’ on electronic transfers to the accounts of money changers in return for hard cash. The main contention surrounds whe...

A town in Switzerland has begun to accept Bitcoin payments for certain city services. The northern town of Zug decided to allow Bitcoin payments earlier this month for public services as a part of a trial run. The municipality services will be capped at 200 francs worth of Bitcoin, and include services like public utilities. The trial run will extend through the end of 2016, and is intended to assess the long-term economic viability of accepting cryptocurrency for public services. Zug part of “crypto valley” The canton of Zug, where the town of Zug is located, is home to what is known as “crypto valley,” a geographical area home to many Bitcoin and blockchain-based startups. The area profits from a favorable business climate and includes companies prominent in the cryptocurrency world such as Xapo and ShapeShift. Mayor Dolfi Müller says: “We want to express our openness to new technologies…Our goal is to meet their [fi...