Bitcoin

Bitcoin lets you send money over the Internet

Bitcoin is like email

[email protected] [email protected]

The Internet

Bitcoin is like email

[email protected] [email protected]

The Internet

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Multibit - DesktopThunderbird

Gmail Electrum - Desktop

Blockchain.info - Browser

“Bitcoin Wallet” - Android

Bitcoin-Qt - Desktop (Fullclient)

Armory - Desktop

Bitcoin is another currency

Bitcoin is another currency

How to get bitcoins?

Exchanges

Person to person

Why is Bitcoin better?

Truly international

Online shopping

Much cheaper than wire transfer

$-30.00

-$0.0001

Much cheaper than wire transfer

$-30.00

-$0.0001

(How can you send 5 dollars overseas?)

Difficult to block

Protect your money from inflation

Hold your own money

It’s money with an API!

Sending

money over Twitter

Sending

money over Reddit

What is Virtual Currency

• What is virtual currency?

• What is the connection between virtual currency and gambling?

• Virtual currency as currency used in social gaming (Value of virtual currency and virtual goods are generally restricted to virtual world) (E.g. World of Warcraft Gold, Zynga poker chips)

• Virtual currency as electronic money (Form of alternative currency not produced by any central banks) (E.g. Bitcoin)

Bitcoin

• Created by “Satoshi Nakamoto” – an anonymous or pseudonymous developer or

group of developers

• Debuted in 2009

• Used in peer-to-peer transactions in which participating parties recognize its value

• No central bank or clearing house, no financial regulator, not tied to any currency

• Bitcoin are stored and sent through e-wallets

• Traded/exchanged through online virtual currency exchanges (Mt. Gox, TradeHill)

Bitcoin (cont’d)

• Approximately 11 million Bitcoin have been mined, 21 million Bitcoin in total.

• “Miners” – supply Bitcoin network with computing power needed to maintain the

security of the block chain (a distributed technology that acts as Bitcoin’s ledger)

• Every single Bitcoin carries the entire history of the transactions it has undergone,

and any transfer from one owner to another becomes part of the code

• Bitcoin is stored in such a way that the new owner is the only person allowed to

spend it.

• Miners are rewarded with “blocks” of issued bitcoins (a “block” currently contains 25

bitcoins); this is how currency is issued

• Price of Bitcoin fluctuates wildly. As of April 23, 2013, 1 bitcoin is worth $130 USD

Bitcoin (cont’d)

Bitcoin/ $USD chart