The bottom of Bitcoin’s crazy surge

The price of the digital currency has risen eightfold since the beginning of 2017. Independent of the U.S., Bitcoin is often accused of funding illicit trade.

It’s hard to write something you don’t know. To better understand how cryptocurrencies work, in 2014 the World Economic Services purchased 0.243 bitcoins for 80 euros on one of the many online sales platforms. Since then, reserves have been sleeping on digital wallets. 0.243 Bitcoin did not move. But they are now worth close to €1,600, almost 20 times the original bet…

That is, if the process of sulfur-containing electronic money does not stop climbing! The numbers are staggering. When created in 2009 by a mysterious engineer, one bitcoin was worth just a few cents. In January of this year, it was close to $900. Since then, despite the price volatility (from +15% to -15% in a few days), it has continued to rise and today is over $8,000 (€6,770).

The intensity of this outburst is doubtful. For its critics, it demonstrates the dangers of Bitcoin. “This is a scam,” JPMorgan Chase CEO Jamie Dimon got carried away in September, threatening to fire traders who tried to buy it. “It’s not a currency, it’s a speculative tool,” a few days ago, European Central Bank (ECB) deputy governor Vitor Constancio compared the current runaway to the tulip mania of the 16th century, when a strange speculator hysterically Emotions grabbed the tulip bulbs.

currency independent of country
Of course, for its lawyers, Bitcoin first heralded a technological revolution. “It’s as important as the internet, even if it’s still incomprehensible,” assured Pierre Noizat, co-founder of Paymium, a platform that exchanges bitcoins for euros. Who would have thought in 1999 that the web would spawn innovations like Google and Wikipedia? Bitcoin will do the same. »

Ordinary people must insist on understanding how this bizarre currency works, often accused of funding illegal trade. Unlike the euro or the dollar, it is independent of the state and not controlled by the central bank. Its issuance is actually driven by a computer algorithm based on the blockchain, a chain of coded and verified transactions.

“This is a great innovation: this channel is a public database that lists all the transactions made since Bitcoin was born,” explained British engineer David Phillips, who has been a follower since the beginning. And it is impossible to modify it, because this requires simultaneous intervention of all computers working on the blockchain. In this system, bitcoins are issued to reward computer enthusiasts for serving their computers to the network to perform the (increasingly difficult) computations that make up the blockchain.

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