What is Bitcoin and would it be a good Christmas present? What’s it really worth?

 Brittany DaSilva

 

As if money wasn’t already complicated enough, now there is a new form of currency popular on the internet: Bitcoin. Classified as a type of “cryptocurrency”, Bitcoin is a form of digital or virtual currency that is gaining a lot of popularity online. Common shorthand for this currency is “BTC” when referring to prices or amounts, as in “100 BTC”.

 

One of the major benefits of Bitcoin is the fact that it is a decentralized digital currency, meaning that there are no banks or administrators involved in the Bitcoin system. Any Bitcoin transactions are strictly between users themselves, without any third-party involvement. Bitcoin can be transferred instantly and securely between any two people in the world.

 

Another benefit to using Bitcoin is the fact that users remain relatively anonymous. As identity theft remains a real issue in today’s society, Bitcoin offers a level of security that traditional banking systems simply cannot compete with. Bitcoin users can send or receive money from anyone on the Internet, without worrying about who they can or cannot trust. Your real-world identity is in no way connected to your Bitcoin account, and therefore, cannot be stolen.

 

To become a Bitcoin user, you will first need a Bitcoin wallet address, which is a unique identifier comprised of 26 to 35 alphanumeric characters, beginning with the number 1 or the number 3. Unless a user were to connect their name to their address, there is virtually no way to discover who owns each address. Your Bitcoin wallet also contains a “public key” and a “private key”, which allow you to send and receive Bitcoin.

 

A “public key” is similar to an ID number or an email address; anyone can look up this address and send Bitcoins to it. A “private key” acts like an email password. It is a randomly generated string of alphanumeric characters that gives you the ability to spend the Bitcoins in your wallet. You must keep your private key secure and to yourself. If you lose your private key, you’ll no longer be able to access your wallet. If someone were to discover your private key, they could easily empty your wallet.

 

When it comes to giving Bitcoin as a Christmas present, it’s important to keep the receiver in mind. If no one on your Christmas list is particularly technologically savvy, they may not even understand what Bitcoin is. On the other hand, Bitcoin may just be the perfect gift for the oft-difficult to buy for tech geeks or financial experts on your list.

 

Bitcoin is continually increasing in value, and cryptocurrency in general is becoming more mainstream with each passing day. However, as Bitcoin was the first decentralized digital currency on the market, it has become quite expensive. Based on its current market value, 1 BTC equals approximately $20,000 in Canadian dollars.

 

If you are interested in purchasing cryptocurrency as a Christmas gift for someone on your list, it may be worth looking into some more affordable options. There is a list of over 1000 active cryptocurrencies available to date, and this list is continually growing, as new currencies are constantly being developed. It’s becoming increasingly clear that cryptocurrency is here to stay, but its suitability as a Christmas present is largely dependent on those you’re buying for this year.