Summary:
One bitcoin cost around $9 in 2011, then rose to about $14 and it is worth around $880 in 2013, it is on the brink of respectability. Its appeal comes from the fact that it does not physically exist and each bitcoin is just a string of numbers. A decentralized network of computers ensures the authenticity of bitcoin and issues new ones by doing complex calculations instead of a bank, allowing bitcoin to be traded peer to peer, bypassing credit card companies and payment processors. It’s digital cash, offering the same relative anonymity and freedom as a paper sack of bills. Many of bitcoin’s hard-core fans see the currency as a revolutionary step toward this anarchocapitalist wonderland. However, even with government regulation, the promise of bitcoin seems to end with helping online retailers avoid credit-card processing fees. Bitcoin is mainly innovative in the way of credit default swaps: new ways to gamble with money.
Reader's Response:
I agree to a large extent that bitcoins cannot last as a currency. Bitcoins, because they are not widely regulated or under government scrutiny, are mainly used for illegal purposes. In January 2014, U.S. government agents arrested Charlie Shrem, the CEO of Bitcoin exchange BitInstant, charging him with laundering money for customers of the online drug bazaar Silk Road, which has already been shut down. Law enforcement is trying to stop the use of Bitcoin on such sites—where people can conveniently buy drugs, guns, and illegal pornography. Bitcoins are so widely used for illegal purposes as they are a source of secure payment mode. When one performs a transaction, the Bitcoin software performs a mathematical operation to combine the other party’s public key and his own private key with the amount of Bitcoins that he wants to transfer. It is practically impossible, even with the most powerful computer, to ascertain the code of someone’s private key from his public key, due to encryption. Thus, to prevent illegal crimes from happening, the government should not consent to regulating bitcoins as a currency.
Although people are willing to trade in their government-issued money to obtain Bitcoins, it will not last as a currency because it will pose challenges to the global banking system.
The summary is quite separated, in that each sentence is a point on its on. It does not flow in any order, which makes it quite confusing if people have not read the article to begin with. However, the main points was mentioned and properly stated, so if a little order was added, it would make it better.
ReplyDeleteThe reader response is very well written, clearly explaining the reason to support your point and also bringing in examples which further supports their point. The examples and elaboration revolved around the point with no extra information that is useless. By: Shernice Phuah(4B) and Cheryl Goh(4C)