Bitcoin is the new internet peer-to-peer digital currency. This differs from traditional, government-backed currencies because no central bank is the issuer and their is no middleman.
Satoshi Nakamoto published a white paper in 2008 describing how this protocol could work. In 2009, he released his Bitcoins.
The supply of Bitcoins is regulated by software as a way to create a type of electronic currency that was anonymous, secure and independent from governments and central authorities.
The Bitcoin was recently legitimized by the United States applying money laundering rules to it. Now transactions over $10,000 must be reported to the U.S. Treasury, but that is nothing new to Americans who have little or no financial privacy.
The use of Bitcoins is expected to increase dramatically especially in international transactions. This will be a topic this blog will be watching.
Source: “Bitcoin: How the Internet Created Its Own Currency,” Mashable, March 25, 2013
