(The New American) With the price of a single Bitcoin exploding by 4000 percent just since January and by 400 percent in the last month, concerns are increasing about its legitimacy as a viable Internet money that could effectively serve as an alternative to central banks’ currencies.
The Bitcoin morphed from an Internet algorithm to legitimacy beginning in August when a federal judge ruled that the digital currency serves as money just like the dollar, the yen, and the yuan. It gained further legitimacy when China’s giant Internet provider Baidu announced in October that its website firewall division would begin accepting Bitcoins. The nearly 20 Bitcoin trading platforms located in China now handle more than half of the world’s Bitcoin transactions.
The Bitcoin’s credibility took another jump when a Senate committee gathered several government agencies together early in November to discuss how to regulate it, driving its price to a new high for the year during the day of that meeting. Another boost came from an unlikely place: the Federal Reserve. It issued a “Bitcoin Primer” which explained how the Bitcoin works, calling it “a remarkable conceptual and technical achievement…” As of Friday, the Bitcoin was trading at over $1,100 apiece. The price chart shows a nearly exponential explosion just since the first of November.
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