I’ve been around the Internet for a while and I’ve found myself very interested in the future of the network and its new dominant currency, the Bitcoin. Bitcoins could exchange from $700-1000 during the next few weeks as you read this post. However, its high volatility makes it something investors are worried and excited about at the same time.
However, let’s talk about money. Money only has power if people make use of it and adhere to its value. When people do not recognize the value of money, the financial system collapses. Any sort of currency is legal as long as it promotes fair trade, competition and is regulated by law.
All currencies are government-regulated and issued. This means that the government has some control over the inflation of money by means of estimating the amount of money the mint prints.
Why bitcoin is not recognized by many governments or is even considered illegal and highly risky, is not just because of its high volatility, but its capability to hide transactions. Bitcoins could hide transactions into encrypted codes, which make them untraceable even if the bitcoin network records each and every transaction made by Internet users.
The government enforces the laws agreed upon by society for one another, and if these laws do not apply to bitcoin, which is a decentralized currency, regardless of any official statement, it is already considered an illegal form of currency.