6 Things You Should Know About Bitcoin
Bitcoin is one of the top buzz words to be heard and discussed in 2014. Having been defined by some as the world’s best form of currency indicates it may be worth understanding. What does this really mean? Many are still trying to understand the significance of Bitcoin, and others will just chalk it up to another techy term soon to expire, but this is one term that business owners should learn about, and strive to better understand. The term itself is not fundamental, however the idea that it represents will likely have a long-term and powerful effect on future commerce, for all businesses.
- Started in 2008 Bitcoins are released through a process of mining mathematical puzzles, also called crypto-currency. Once mined, they are released into a decentralized public ledger.
- There is no public authority. This makes it private, anonymous, fast and cheap.
- Bitcoin has had significant value fluctuations in the last six months.
- Technology has changed the place where we put our trust. People trust people more than they trust financial institutions or governments. This is the driving force behind Bitcoin, or any online currency.
- If money were viewed only as an expression of value, then the Bitcoins of the world begin to make more sense. The digital age has made it easier to quantify value and technology has disrupted our relationship with money.
- Reputation is the new value; the new currency. Brands will stand or fall by their reputations which are built on trust, consistency and transparency. Air miles are considered a form of branded currency. It is said there are more air miles in the world than dollar bills. In another example, Starbucks trades coffee with more star points then money. More recently, Amazon launched Amazon Coins to increase efficiency of instant downloads. People trust businesses more than government, and branded currency is quickly becoming a natural extension to start buying real life products on a more regular basis. In the not too distant future brands may start competing with the real money of the Federal Reserve.
Bitcoin itself may or may not be a currency of the internet future. However, businesses are quickly taking note of the value of their brand, and the customer loyalty that comes with this new currency. This creative way of utilizing brand loyalty is the way many businesses are headed, and more consumers are accepting.