News / Economy

Questions Surround Bitcoin Future

Questions Surround Bitcoin Futurei
X
February 28, 2014 12:09 AM
There are troubling questions about the future of the digital currency known as Bitcoin. The value of the virtual currency has fluctuated wildly in recent months - plummeting from an all-time high of $1,100 last December to just under $600 today. The latest worry comes after the sudden closure of one of the largest bitcoin exchanges this week. Mil Arcega has more.
There are troubling questions about the future of the digital currency known as Bitcoin.  The value of the virtual currency has fluctuated wildly in recent months - plummeting from an all-time high of $1,100 last December to just under $600 today.  The latest worry comes after the sudden closure of one of the largest bitcoin exchanges this week.  

Is Bitcoin dead?  That’s a question many investors are asking after the abrupt closure of Tokyo-based Mt. Gox, one of the largest bitcoin exchange sites.  

Currency trader Kolin Burges flew in from London to get answers, when he found himself locked out of his own account.

“I had 311 bitcoins in there, which at the time was worth around $300,000.  So it looks like that has disappeared," said Burges.

No one really knows why the bitcoin broker shut down.  But economics professor Arun Sundararajan says signs point to a security flaw.  

“It seems to have been a security breach more than anything else where a lot of the bitcoin was stolen by hackers.  And as a consequence, Mt. Gox had to stop trading.  And of course this has sort of lowered the value of the bitcoin traded at Mt. Gox considerably," said Sundararajan.

Former Mt. Gox CEO Mark Karpeles declined to answer questions.  He resigned earlier this month.  But Karpeles has never shied from talking about the risks involved.

Here’s what he told the Reuters news organization last year.

“Bitcoin would quite qualify as a high risk investment.  If you buy bitcoins you should buy keeping in mind that the value could be zero the day after," said Karpeles.

Although the recent cyber problems may have damaged public confidence, Bitcoin enthusiasts say that's because many still see virtual currency as a commodity.  Bitcoin miner Erick Watson spoke to VOA via Skype.

“I would encourage people not to speculate on Bitcoin as a store of value.  I would encourage them to look for opportunities to employ Bitcoin as means of transacting," said Watson.

Despite its slow adoption rate, Watson says Bitcoin is far from dead.  In fact, he sees a bright future ahead for Bitcoin and other virtual currencies as consumers discover practical advantages for private transactions.  

“We’ll continue to creep along as businesses adapt Bitcoin rather slowly, and then we’ll hit some inflection point in the relatively near future, beyond which people will really begin to adopt it heavily," he said.

That may happen sooner not later.  On February 28th - the first bitcoin counter opens in Hong Kong allowing people to buy the virtual currency without going online.

You May Like

Sunni-Shi’ite Divide Threatens Stability of Middle East

Ancient dispute that traces back to the Islamic Revolution fueling modern day unrest More

Shifting Demographics Lie Beneath Racial Tensions in Ferguson

As Missouri suburb morphed from majority white to majority black, observers say power structure remained static More

Video Artists Shun Russia's Profanity Law

Restriction is toughest since Soviet era, though critics reject move as patronizing and ineffective act of censorship in line with a string of conservative morality laws More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Native Bees May Help Save Cropsi
X
Deborah Block
August 22, 2014 12:23 AM
U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video Native Bees May Help Save Crops

U.S. President Barack Obama has called for a federal strategy to promote the health of bees that have been declining. The honeybee has been waning due to parasites, disease and pesticides. Wild bees may be used to take over their role as crop pollinators. Scientists first need to learn a lot more about wild bees, says biologist Sam Droege, who is pioneering the first national inventory on native bees. VOA’s Deborah Block went to his research laboratory in Beltsville, Maryland, to bring you more.
Video

Video US Defense Officials Plan for Long-Term Strategy to Contain Islamic State

U.S. defense officials say American air strikes in Iraq have helped deter Islamic State militants for the time being, but that a broad international effort is needed to defeat the extremists permanently. Defense Secretary Chuck Hagel warned Thursday that the group formerly known as the Islamic State in Iraq and the Levant, or ISIL, is better organized, and financially and militarily stronger than any other known terrorist group. Zlatica Hoke has more.
Video

Video Drug-Resistant Malaria Spreads in Southeast Asia

On Thailand’s border with Myanmar, also known as Burma, a malaria research and treatment clinic is stepping up efforts to eliminate a drug-resistant form of the parasite - before it spreads abroad. Steve Sandford reports from Mae Sot, Thailand.
Video

Video Gaza Conflict, Hamas Popularity Challenge Abbas

The Palestinian unity government of Mahmoud Abbas has failed to convince Hamas to agree to Egyptian-negotiated terms with Israel on a Gaza cease-fire. VOA State Department Correspondent Scott Stearns reports on what the Gaza conflict means for President Abbas, with whom U.S. officials have worked for years on a two-state solution to the Israeli-Palestinian conflict.
Video

Video Nigeria's 'Nollywood' Movie Industry Rolls in High Gear

Twenty years after its birth in a video shop in Lagos, Nigeria's "Nollywood" is one of the most prolific film industries on earth. Despite low budgets and whirlwind production schedules, Nigerian films are wildly popular in Africa and industry professionals say they hope, in the future, their films will be as great in quality as they are in quantity. Heather Murdock has more for VOA from Lagos.
Video

Video UN Launches 'Biggest Aid Operation in 30 Years' in Iraq

The United Nations has launched what it describes as one of the biggest aid operations in 30 years in northern Iraq, as hundreds of thousands of refugees flee the extremist Sunni militant group calling itself the Islamic State. As Kurdish and Iraqi forces battle the Sunni insurgents, the fighting has forced more people to flee their homes. Kurdish authorities say the international community must act now to avert a humanitarian catastrophe. Henry Ridgwell reports for VOA from London.
Video

Video Cambodian American Hip Hop Artist Sings of Personal Struggles

A growing underground movement of Cambodian American hip hop artists is rapping about the struggles of living in urban America. Most, if not all of them, are refugees or children of refugees who came to the United States from Cambodia to escape the Khmer Rouge genocide of the 1970s. Through their music, the artists hope to give voice to immigrants who have been struggling quietly for years. Elizabeth Lee reports from Long Beach, California.
Video

Video African Media Tries to Educate Public About Ebola

While the Ebola epidemic continues to claim lives in West Africa, information technology specialists, together with radio and TV reporters, are battling misinformation and prejudice about the disease - using social media to educate the public about the deadly virus. VOA’s George Putic has more.

AppleAndroid

World Currencies

EUR
USD
0.7492
JPY
USD
102.27
GBP
USD
0.5960
CAD
USD
1.0950
INR
USD
61.300

Rates may not be current.