Doomsayers Banging on That Bitcoin Will Plummet in Value
We see it happen with all commodities. Take house prices for example.
In the UK, house prices soared during the good years, and then the bubble burst after Northern Rock went under and the pound plummeted in value quite spectacularly. This wasn’t helped by several other banks then requiring government backing because they’d bought ‘black debts’ that were never fully disclosed.
What we see in all financial sectors is fits and troughs, they go up, and then come down, and up and down.
With Bitcoin, the problem is, it’s not a truly safe currency as it has no actual physical money you can hold, and is essentially monopoly money that you can transfer for goods, services or convert into an actual paper based currency, and eventually like all new currency, the novelty wears off and the value drops.
Usually in line with other currencies, but it must be noted, Bitcoin started low and at the start of the year one Bitcoin was worth in the region of $1000 but recently was valued at $17000 per Bitcoin, dropping slightly to just over $12000.
There is also controversy as it has been revealed that drug dealers and pimps are using Bitcoin to launder their money by converting it into Bitcoin at one of the several machines in the UK and the US.
The way Bitcoin works, is by allocating your computers excess power to a server that does a never ending mathematical equation, this is known as mining, and your Bitcoin is a reward for being a part of the system.
It is not a centralized bank per se, and as such is done via Peer-to-Peer networking similar to the way a torrent works. However, there are some controversies, namely the fact that there are viruses out there which mask themselves as a legitimate miner, but in actual fact are bypassing your gains and sending them direct to the person who sent out the miner to begin with.
This can result in computers grinding to a halt, overheating and even permanent damage to your computer by overclocking to dangerous levels without the user knowing it.
It is recommended that should you decide to try mining Bitcoin, you think long and hard, because nothing is without risk, and the last thing you want is for your computer to be full of nasties from 3rd parties.
If you do decide to go ahead, we recommend you beef up your security and firewall, and ensure that the miner only runs when you want it to and not the other way round as this will give you more control over what your computer is doing and how it mines.
You can read up more on Bitcoin all over the web, with compelling arguments from pro and anti bitcoiners, and we suggest you do, do your homework, because you really do need to be in the know to truly understand how it works, and more importantly how safe you are mining.
If you’re ever in doubt about mining afterwards however, you can easily uninstall the miner.