Two Sides of the Same Bitcoin

The buzz surrounding bitcoin can’t be ignored any longer. The digital currency, which came to life in 2009, has experienced wild fluctuations in recent times; in February a single bitcoin traded for $20, today that number stands at $112. Following two huge upward moves in March the currency lost nearly 20% of its value overnight after one of its biggest exchanges fell victim to attack by a group of hackers, triggering a massive sell-off.  In the midst of all this drama more than a few people have become bitcoin millionaires by buying up the currency early – but what are these bitcoins really?

Known as a crypto-currency, bitcoin is a type of digital currency that uses cryptographic techniques to ensure security. Furthermore, because bitcoin is not associated with any one country it means that there is no central bank that controls the currency. In fact, credit for creation of bitcoin goes to Satoshi  Nakomoto, but no one knows who he is or even whether Satoshi is one person or refers to a group of creators.

All transactions involving the digital currency takes place through p2p (peer-to-peer) networks, a network of individual hosts who agree on how bitcoin is used. Like any other currency bitcoins are traded on exchanges such as Mt. Gox, which hosts up to 80% of all bitcoin trade.

Bitcoin lies somewhere in between being a pure currency or commodity, having characteristics of both. Since bitcoin is free from the influence of any central bank or entity , its value is determined entirely by the laws of supply and demand. It actually behaves more like gold or other precious metals in this regard. Funnily enough, that’s not the only thing bitcoin has in common with precious metals.

The way you get a bitcoin is to mine them, and just like the amount of gold that exists in the world there is a finite number of bitcoins that can be mined. Whereas in a centralized economy the central bank could just print more money and expand the monetary base, there are exactly 21 million bitcoins that will ever exist; currently about 11 million of them have been mined.

Bitcoins are mined from deep mathematical mine-shafts. Using a computer, bitcoins are created every time a miner is able to crack a complex algorithm, leading to the discovery of a new ‘block’ of bitcoins. The difficulty of solving these math problems are always rising, so as to keep the rate of discovery constant. The algorithm actually mimics the rate at which commodities like gold are mined, meaning the last few bitcoins won’t be mined until 2040. At first one could mine using any standard computer but the increasing difficulty of mining bitcoins means that now dedicated mining rigs with incredible processing capabilities are required.

Due to their cryptographic nature, bitcoins are great for conducting anonymous transactions and are used to power the ‘dark web’. For example, using software called Tor, you can hide your identity online and access the digital black market called The Silk Road, the “underground website where you can buy any drug imaginable”.

The influence of the crypto-currency is growing; the financial crisis no doubt had a large part to play in that but bitcoin is also changing the way people think about currencies. MintChip is a new digital currency backed by the government of Canada, which sees the potential for a “huge digital economy that [will] be fueled by smartphones and mobile.” MintChip will be anonymous and allow people to pay each other using smartphones, USB keys, and computers; the traces of the bitcoin philosophy are stamped all over MintChip.

Public sentiment is changing towards digital currencies.  Wikileaks and WordPress now accept payments through bitcoin; CNN has even added a bitcoin ticker to its crawler. At first only a few stores would accept bitcoin as payment, one of the first being an online store that sold Alpaca socks; that number is growing, and more stores and even restaurants are starting to accept bitcoin. You can even turn your bitcoins into gift cards from Amazon, Barnes & Noble, iTunes and even national governments are warming up to the idea of using crypto-currencies. Digital currencies, it seems, are here to stay.

*** SPECIAL ALERT — June 27, 2020 — THREE of this Year’s Motley Fool Stock Picks Have Already Doubled! ****

We have been tracking ALL of the Motley Fool stock picks since January 2016. That’s 4+ years, 54 months and 108 stock picks. As of Friday, June 26th 3 of their 12 2020 stocks picks have already doubled (TSLA, ZM, SHOP). In addition, 4 of their 2019, 8 of their 2018, 7 of their 2016 and 10 of their 2016 picks have also doubled. Best of all, over these 54 months, the average stock pick is up 111%. That beats the SP500 by an average of 87%. And that’s even accounting for all of this COVID mess that has wreaked havoc on some stocks but presented opportunity for other stocks. THAT is how the Fool does so well!

  • Shopify (SHOP) – April 2, 2020 pick and it is already up 163%
  • Zoom Video (ZM) – March 19, 2020 pick and it is already up 107%
  • DexCom (DXCM) picked Feb 20, 2020 right before the market crashed and it is still up 26%
  • Tesla (TSLA) picked January 2, 2020 before the crash and it is up 123% compared to the SP500 -7% so it is ahead of the market by 130%
  • HubSpot (HUBS) picked December 5, 2019 and it is up 46%
  • Netflix (NFLX) picked November 21, 2019 and it is up 42%
  • Trade Desk (TTD) picked November 11, 2019 and up 111%
  • Zoom Video originally picked Oct 3 and it is up 234%
  • SolarEdge (SEDG) picked September 19, 2019 and it is up 44%

Now, no one can guarantee that their next picks will be as strong, but our 4.5 years of experience has been super-profitable. They also claim that since inception, their average pick is up 424% and now we believe them. You sure don’t want to risk missing out. Many analysts are saying that we have passed the bottom of this COVID crisis and stocks will recover quickly. So make sure you have the best stocks in your portfolio.

Normally the Fool service is priced at $199 per year but they are currently offering it for just $99/year if you click this link

CLICK HERE to get The Motley Fool’s Stock Picks for just $99 per Year! 




GET UP TO $1,000 IN FREE STOCK

WHEN YOU OPEN A ROBINHOOD BROKERAGE ACCOUNT

Robinhood was the first brokerage site to NOT charge commissions when they opened in 2013. They just past 10,000,000 accounts and to celebrate they are offering up to $1,000 in free stock when you open a new account.

Here’s the details: You must click on a special promo link to open your new Robinhood account. Then when you fund your account with at least $10, you will receive one stock valued between $5 and $500. Then, you will get a link to share with your friends. Every time one of your friends opens an account, you will receive another free stock valued between $5 and $500. Click here to learn more about this Special Robinhood offer.

Claim your free stock NOW

(before it’s too late)

3 responses to “Two Sides of the Same Bitcoin”

  1. […] Two Side of The Same Bitcoin – by @wallstsurvivor […]

  2. […] Two Side of The Same Bitcoin – by @wallstsurvivor […]

Leave a Reply

Your email address will not be published. Required fields are marked *