Bitcoin as Currency vs Bitcoin as Technology

Bitcoin Currency

Bitcoin as CurrencySo far, Bitcoin has proven extremely efficient in a business sense in the following ways: There is the anonymity of cash, which enables individuals who don’t know each other to securely trade without the need for a financial service provider eg. MasterCard, Visa etc. Secondly, there is the element of trustworthiness without needing a financial institution, such as a bank, to vouch for you. Thirdly, Bitcoin has also shown a growing ability to handle an increasing amount of transactions in an efficient and convenient manner. The system is also growing at a steady pace and is able to accommodate that growth. Lastly, it is obviously ideal for people that want to keep the long fingers of government out of their pockets, because at this stage it is very difficult to regulate and tax funds generated by using Bitcoin, whereas other financial entities have juridical identities as well as physical locus. That means that Uncle Sam has its finger in their pies all the way to the government bank account.

However, Bitcoin has one major shortcoming: It is not a reliable store of value. Obviously, since government cannot tax or regulate this digital currency, no government accepts it as a legal tender. Also, since it is not yet legally definable as either tangible or intangible property, owners has no legal protection in the event that they get “robbed” or taken for a ride in this area. It does, however, have the scarcity factor behind it – kind of like art. At the moment there are only 13 million bitcoins in the world and this amount will not grow beyond 21 million outstanding. So, as long as people want to buy Bitcoin “art” it does have a certain store of

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