30th July 2012  Bitcoin Sets New Euro Record.

The price of Bitcoin jumped in the last week to over e7 for the first time on Europe's largest market for trading the digital currency. Mtgox, which trades Bitcoin in a number of currencies, has seen a volume of over e600,000 traded in the last 30 days. In US Dollars the price has struck over $9 for the first time since September 2011 when a number of security breaches at mtgox saw a drop from an all-time high of over $32.


Bitcoin is a form of decentralized digital currency which came into existence in 2009. Users can download a client that allows them to take part in the process of "mining" new Bitcoins by contributing to solving a problem. When the problem is solved a block of Bitcoin is unlocked and distributed. The difficulty of generating the next block is then adjusted so that as time goes on it becomes harder and harder to generate new Bitcoin. Thus Bitcoin has no centralised issuing authority and even the identity of the author of the original Bitcoin client, Satoshi Nakamoto, is a mystery.


Due to the currency's tendency to fluxuate wildly; it traded at $0.30 at the start of 2011, many legitimate business' have been slow to adopt Bitcoin as a form of payment or have done so only to abandon it later on. Part of the current impetus behind its rise in value is its untraceability. While the flow of each coin can be traced from its generation through every wallet address it is stored in this information can't be used to identify the owner of the wallet. As such Bitcoin has become the official currency of Silkroad, the hidden online marketplace referred to as the "Amazon.com of illegal drugs".


Even though Bitcoin is finding it hard to be accepted by legitimate enterprises applications like Coinbase are receiving investment in anticipation of a day when Bitcoin is more widely used. Coinbase has received $164,000 in funding through Y Combinator who previously funded start-ups like Reddit, Dropbox and Airbnb. One of a number of eWallet applications, Coinbase aims to provide a secure method for users to transfer Bitcoin to each other or transfer funds to or from a bank account and convert into or out of Bitcoin.


To date some 9.5 million Bitcoin has been generated, just under half of the 21 or so million that are expected to ever exist. While the number of Bitcoin will stabilise around 2033 generation will go on until the last coin appears sometime around the year 2140.



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