Why Do Bitcoins Have Value?

By JOHN P. KELLEHER

Bitcoin (BTCUSD) is often referred to as digital currency and as an alternative to central bank-controlled fiat money. However, the latter is valuable because it is issued by a monetary authority and is widely used in an economy. Bitcoin’s network is decentralized, and the cryptocurrency is not used much in retail transactions.

One can argue that Bitcoin’s value is similar to that of precious metals. Both are limited in quantity and have select use cases. Precious metals like gold are used in industrial applications, while Bitcoin’s underlying technology, the blockchain, has some applications across the financial services industries. Bitcoin’s digital provenance means that it might even serve as a medium for retail transactions one day.

KEY TAKEAWAYS

  • Currencies have value because they can function as a store of value and a unit of exchange. They also demonstrate six key attributes to enable their use in an economy.
  • The definition of value in a currency has changed over centuries from physical attributes to the velocity of its use in an economy.
  • Bitcoin demonstrates some attributes for a currency, but its main source of value lies in its restricted supply and increasing demand.
  • If the price of one bitcoin were to reach $514,000, Bitcoin’s market capitalization would reach approximately 15% of the global currency market.
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FIVE REASONS BITCOIN WILL REPLACE CREDIT CARDS

Using a credit card to pay for purchases has negative implications for businesses and consumers. Bitcoin provides a better, alternative payment method.

Contrary to some predictions, Bitcoin is quickly becoming an accepted means of conducting transactions. Major companies like online retailer Overstock.com and mobile provider AT&T already allow customers to pay in bitcoin. And the list of businesses accepting bitcoin keeps growing every day. 

On a basic level, this trend proves that bitcoin isn’t a useless virtual currency as critics love to claim, but it also represents something more fundamental: Bitcoin’s potential to replace legacy payment processing systems like Visa and MasterCard. 

Perhaps this may sound far-fetched, but there are plenty of advantages that Bitcoin offers both consumers and merchants. And if you know anything about the creative destruction inherent in capitalist societies, Bitcoin replacing credit cards is only a matter of time. 

Let’s look at the anatomy of credit cards and Bitcoin payments before highlighting the differences between both of them.

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Leumi becomes the first Israeli bank to offer Bitcoin and Ethereum trading

 by Florence Muchai

  • Israeli`s Bank Leumi approves crypto trading.
  • Banks worldwide start to embrace crypto services and blockchain innovations.
  • Israel gears up for crypto adoption.

According to reports, Bank Leumi, an Israeli bank, will enable crypto trading and become the first in the country to allow such trading activity. On March 24, Pepper Invest, the bank’s digital platform, announced that it would collaborate with Paxos to provide the service. Bank Leumi is Israel’s second-largest financial bank after Bank Hapoalim. 

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200 BITCOIN ATMS INSTALLED AT WALMART… WITH PLANS FOR 8,000 IN TOTAL

Walmart plans to eventually install 8,000 Bitcoin ATMs in the U.S. and has installed 200 in a pilot program. 

Walmart has partnered with coin-cashing machine company Coinstar and crypto-cash exchange Coinme to install 200 Bitcoin (BTC) ATMs in its stores across the United States. 

Although the pilot includes only 200 kiosks, the broader launch plans to eventually see the installation of 8,000 Bitcoin ATMs across the country, according to Bloomberg. There have been no further details on timelines as of yet. 

According to Coin ATM Radar, there are currently over 25,000 Bitcoin ATMs at select grocery stores and service stations in the United States. Coinstar operates 4,400 kiosks enabled for Bitcoin purchases across 33 states. 

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Sam Altman’s Worldcoin wants to scan eyeballs in exchange for crypto

It all starts with a 5-pound chromatic sphere called ‘The Orb’

By Lucas Matney@lucasmtny

As investors race to capitalize on surging interest in cryptocurrencies, startups are getting creative in how they onboard a generation of crypto users to their first wallets.

Worldcoin is perhaps one of the most audacious efforts to bribe the world to embrace their currency. The startup, founded by OpenAI CEO Sam Altman and Alex Blania, wants to put a crypto wallet (and some of their currency) onto every human’s smartphone, but in order to do so they have to build a way to determine whether someone is a unique human. Worldcoin is aiming to make their proof-of-personhood network in the least dystopian way possible. That being said, it still requires scanning a billion people’s eyeballs with a five-pound chromatic sphere called “The Orb”.

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US Launches National Cryptocurrency Enforcement Team to Prosecute ‘Criminal Misuses of Cryptocurrency’

The U.S. has launched the National Cryptocurrency Enforcement Team, an initiative of the Department of Justice (DOJ), to tackle and prosecute “criminal misuses of cryptocurrency, particularly crimes committed by virtual currency exchanges, mixing and tumbling services, and money laundering.” U.S. Deputy Attorney General Lisa Monaco said, “The point is to protect consumers.”

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Second largest US mortgage lender will accept crypto payments this year

Speaking during a conference call about the firm’s Q2 results, United Wholesale Mortgage CEO Mat Ishbia outlined plans to accept crypto payments this year.

By BRIAN QUARMBY 

United Wholesale Mortgage (UWM), the second-largest United States-based mortgage lender, is planning to accept cryptocurrency payments this year starting with Bitcoin (BTC).

UWM CEO Mat Ishbia revealed the crypto plans on Monday in a conference call regarding the firm’s Q2 results — with the firm posting $138.7 million in net profits for the quarter. 

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SEC Chairman Says Satoshi Nakamoto’s Innovation Is Real, Crypto Rules Are Clear

The chairman of the U.S. Securities and Exchange Commission (SEC), Gary Gensler, says that Satoshi Nakamoto’s innovation is real. “It has been and could continue to be a catalyst for change in the fields of finance and money,” he said.

by Kevin Helms

Satoshi Nakamoto’s Innovation Is Real.

SEC Chairman Gary Gensler talked about bitcoin and cryptocurrency regulation last week at the Aspen Security Forum where he outlined his plans to regulate the crypto space. He began by referencing the Bitcoin whitepaper and its creator, the pseudonymous Satoshi Nakamoto.

“His innovation spurred the development of crypto assets and the underlying blockchain technology,” Gensler said about Satoshi, adding that “the crypto asset class has ballooned” and is now worth about $1.83 trillion.

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Bitcoin mining is suddenly one of the most profitable businesses on the planet

The sweeping shutdown delivered a huge prize to the rest of the world’s miners. 

BY SHAWN TULLY

Would you believe that Bitcoin mining generates just as much revenue as the age-old pursuit of unearthing gold and silver ore? Right now, minting this most unorthodox asset may also rank as the most profitable major industry on the planet. The entrepreneurs running their towering racks of rigs 24/7 were garnering stupendous margins when prices surged to over $60,000 in mid-April. Now they’re pocketing even fatter returns at prices that are one-third lower. And we’re talking numbers that for now surpass such famously lucrative enclaves as Big Pharma, luxury goods, and software. 

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Miami Launches Its Own Cryptocurrency To Fund City Services

The new MiamiCoin, a cryptocurrency offered through the CityCoins initiative, is available for mining starting Tuesday.

By Tiffany Razzano, 

The new MiamiCoin, a cryptocurrency offered through the CityCoins initiative, is available for mining starting Tuesday. 

MIAMI, FL — Miami has become the first city with its own cryptocurrency, a digital currency.


The new Miami Coin became available for mining Tuesday through the CityCoins initiative, which generates funds for municipalities through city-specific cryptocurrencies. 

“MiamiCoin ($MIA) is a way for people to support the Magic City and grow its crypto treasury while earning BTC and STX yield for themselves,” according to the CityCoins website. “MiamiCoin can be mined or bought by individuals who want to support the Magic City and earn crypto yield from the Stacks protocol.”

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DOJ recovers 63.7 Bitcoins paid out in Colonial Pipeline ransomware attack

The agency tracked down the payment through the Bitcoin public ledger.

By I. Bonifacic

The US Justice Department has recovered part of the ransom Colonial Pipeline paid last month to regain access to its computer systems after it was locked out of them by “apolitical” ransomware gang Darkside. The agency says it seized 63.7 Bitcoins, worth nearly $2.3 million when it carried out the action, by tracing the cryptocurrency through the public Bitcoin ledger. The amount represents more than half of the approximately 75 Bitcoins Colonial Pipeline paid out to the group (the value of the cryptocurrency has fallen since May).

The Justice Department says it obtained the private key to the wallet the hackers used to store the currency. To recover the money, the federal government took legal action against an exchange or custodial wallet that has servers in Northern California.    

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New milestone reached as 100 cryptocurrencies reach a $1B market cap

In the past two months, the number of crypto projects with a $1 billion market cap doubled as increased adoption pushes token valuations higher.

In the last two months, the number of cryptocurrencies with a $1 billion market caphas doubled since the last time Cointelegraph reported on the milestone. As things currently stand, there are 100 projects that have reached a $1 billion market capitalization.

Unicorns are typically privately held startup companies valued at more than $1 billion, but traditional finance is increasingly applying the term to high-value cryptocurrencies that institutions are only now gaining exposure to. 

The entrance of institutional investors into the cryptocurrency sector over the course of 2021 has been one of the driving forces of growth for the ecosystem as a whole as multi-billion dollar companies like Tesla, Square and MicroStrategy have converted a portion of their cash reserves into Bitcoin (BTC) and other top altcoins. 

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