Page 23 - ARUBA TODAY

Monday 15 May 2017 BUSINESS
A24

AP Explains: What is bitcoin? A look at the digital currency

The Associated Press greed for the collective
NEW YORK (AP) — It’s worth good. A network of tech-
more than an ounce of savvy users called miners
gold right now, it’s com- keep the system honest by
pletely digital and it’s the pouring their computing
currency of choice for the power into a blockchain,
cyberattackers who crip- a global running tally of
pled computer networks every bitcoin transaction.
around the world in recent The blockchain prevents
days. When the attackers’ rogues from spending the
“ransomware” sprang into same bitcoin twice, and
action, it held victims hos- the miners are rewarded
tage by encrypting their for their efforts by being
data and demanding they gifted with the occasional
send payments in bitcoins bitcoin. As long as min-
to regain access to their ers keep the blockchain
computers. Bitcoin has a secure, counterfeiting
fuzzy history, but it’s a type shouldn’t be an issue.
of currency that allows HOW BITCOIN CAME TO BE
people to buy goods and It’s a mystery. Bitcoin was
services and exchange launched in 2009 by a per-
money without involving son or group of people op-
banks, credit card issuers erating under the name
or other third parties. In this April 7, 2014 file photo, Bitcoin logos are displayed at the Inside Bitcoins conference and Satoshi Nakamoto. Bitcoin
trade show in New York.
Here’s a brief look at bit- Associated Press was then adopted by a
coin: small clutch of enthusiasts.
HOW BITCOINS WORK and other currencies. it’s nearly quadrupled in the coin wallet site blockchain. Nakamoto dropped off
Bitcoin is a digital currency HOW MUCH IS IT WORTH? last 12 months. But its price info. A year ago, activity the map as bitcoin began
that is not tied to a bank One bitcoin recently trad- doesn’t always go up. A was closer to 230,000 trans- to attract widespread at-
or government and al- ed for $1,734.65, according bitcoin’s value plunged by actions per day. tention. But proponents
lows users to spend money to Coinbase, a company 23 percent against the dol- Still, its popularity is low say that doesn’t matter:
anonymously. The coins that helps users exchange lar in just a week this past compared with cash and The currency obeys its own
are created by users who bitcoins. That makes it more January. It fell by the same cards, and many individu- internal logic.
“mine” them by lending valuable than an ounce of amount again in 10 days als and businesses won’t An Australian entrepreneur
computing power to verify gold, which trades at less during March. accept bitcoins for pay- last year stepped forward
other users’ transactions. than $1,230. WHY BITCOINS ARE POPU- ments. and claimed to be the
They receive bitcoins in ex- The value of bitcoins can LAR HOW BITCOINS ARE KEPT founder of bitcoin, only to
change. The coins also can swing sharply, though. A Bitcoins are basically lines SECURE say days later that he did
be bought and sold on ex- year ago, one was worth of computer code that are The bitcoin network works not “have the courage” to
changes with U.S. dollars $457.04, which means that digitally signed each time by harnessing individuals’ publish proof that he is.q
they travel from one owner
to the next. Transactions
can be made anonymous-
ly, making the currency
popular with libertarians
as well as tech enthusiasts,
speculators — and crimi-
nals.
WHO’S USING BITCOIN?
Some businesses have
jumped on the bitcoin
bandwagon amid a flurry
of media coverage. Over-
stock.com accepts pay-
ments in bitcoin, for exam-
ple.
The currency has become
popular enough that more
than 300,000 daily transac-
tions have been occurring
recently, according to bit-