Print 37 comment(s) - last by theapparition.. on Mar 4 at 9:44 AM

Bitcoins are accepted by a growing number of merchants, even used to pay some employees

Bitcoin Magazine this week heralded some exciting news. The popular cryptocurrency that's free of regulation by any nation state has hit a new high of $32 USD/Bitcoin on Mt. Gox, the world's largest exchange.  The previous high had been $31.9099 on June 8, 2011.

Right after hitting that previous high, Bitcoin values began a freefall, which we covered in our piece "Digital Black Friday: First Bitcoin "Depression" Hits".  It was unclear whether the plunge was due merely to profit taking or other issues.  Shortly thereafter, the currency was further devalued when MtGox was hit with a database dump attack and users accounts were compromised due to the service's weak MD5 hashing of passwords.  It took the site months to rebuild trust, beef up security, and unwind the trail of fraudulent transfers.

The Bitcoin rollercoaster ride bottomed out at $2 USD/coin in November 2011.  And last fall BitFloor -- another major exchange -- was hacked, and $250,000 USD worth of Bitcoins were stolen.  But despite that, the currency continued to creep upwards.

Bitcoins on the rise
Bitcoins values have soared in the last six months. [Chart]

Inflation remains a serious concern for Bitcoins, as do scammers using classic techniques like Ponzi schemes.  And there's the issue of Bitcoin-mining malware that's afflicted PC and Mac users alike.  However, the currency's utility as an (relatively) untraceable and easy to use digital currency is keeping it sailing high.

Popular social media site Reddit recently gave Bitcoins a boost, by accepting the cryptocurrency as a means of paying for "Gold" premium memberships.  LaCie Group SA's (EPA:LAC) "Wuala" and Kim Dotcom's new "Mega" file sharing services both accept Bitcoins as a means of payment.

Mt. Gox remains the most popular place to buy and sell Bitcoins.

Domain registrar Namecheap is also considering BitCoin.  And is currently accepting BitCoin payments for various services.

Source: BitCoin Magazine

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RE: Not for me
By Mint on 3/1/2013 3:47:31 AM , Rating: 2
It's not nothing. It's an entire country.

Faith in a country is not nothing. We put faith in a country's ability to protect our property/assets in a dispute, faith that it will do its best to enforce our laws & rights, etc. Faith that the Federal Reserve will target 2-3% inflation is no different.

If you have no faith in these basics then you have no faith in anything in society and may as well kill yourself. To have more faith in Bitcoins than major currencies when there is no way to enforce the value of the former is insanity.

Gold has virtually zero productive value. You simply have faith that others will keep wanting it because it's rare.

RE: Not for me
By danielravennest on 3/1/2013 6:18:40 PM , Rating: 2
It's not nothing. It's an entire country.

Well, in that case, bitcoins are backed by the nation of Bitcoinica, otherwise known as the people who use it. They are a distributed nation rather than a territorial one, but they exist, as evidenced by the transaction history.

RE: Not for me
By deadrats on 3/1/2013 6:32:12 PM , Rating: 2
Gold has virtually zero productive value. You simply have faith that others will keep wanting it because it's rare.

not true, gold is an excellent electrical conductor and is used extensively in all our electronic devices, just google it.

RE: Not for me
By theapparition on 3/4/2013 9:44:20 AM , Rating: 2
Yeah, I suggest you Google it.

Gold isn't a great electrical conductor, paling in comparison to Copper (the most common) and Silver (the best, but with issues). Gold is almost as bad as aluminum.

The problem with silver is it oxidizes (tarnishes) which reduces it's conductivity. Copper, is only slightly less conductive but costs much less and is easier to work with. Exposed copper still needs to be plated, with tin/lead being common.

What you are thinking is gold is commonly used is for gold plating contacts. While rather average electrically, in alloy form it's harder than copper or it's tin/lead plating for contacts. That makes connectors with gold plated contacts better for mating cycles. Gold also has an inherent lubricity which is desirable for contacts.

But make no mistake that gold is used for mechanical reasons in electronic circuits, not electrical ones.

"When an individual makes a copy of a song for himself, I suppose we can say he stole a song." -- Sony BMG attorney Jennifer Pariser

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