Tuesday 26 March 2013

Tech Tuesday - Bitcoins bid for world domination starts small




The BBC notes Bitcoin virtual currency can now be used to pay for pizza

Orders made via the Pizza for Coins website are funnelled to others for preparation and delivery.

The Pizza for Coins service has been set up by two programmers as a way to boost use of the digital cash. The service acts as a middleman and converts bitcoins into US dollars that are used to pay for food. It charges a small fee to do the currency exchange.

They are not the only ones getting attention with Entrepreneur Taylor More listing his two-bedroom Alberta bungalow, asking 405,000 Canadian dollars (£261,000; $395,000) - or the equivalent in Bitcoins get global attention as noted here.

Bitcoins are now a widely used alternative payments system and one Bitcoin is currently worth about £37. Bitcoins first appeared in 2009 and are closely linked to the global network of computers that supports the currency and its users. Many people generate or "mine" the coins by participating in that network and a growing number of web stores and online firms accept bitcoins as payment.

Bitcoin does not operate like typical currencies: it has no central bank and it solely relies on an internet-based peer-to-peer network. The fact that the system operates outside the global banking world is pretty fascinating and means transactions costs for transferring money and alike are very low and the transaction instantaneous. However you have to worry about just how secure the system is.

I am not sure yet whether the above are examples of a future system or just one off in something that won't take off.

More on Bitcoins on Wikipedia or the Bitcoin website itself.

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