While a relatively new venture in the field of economics, Bitcoin is quickly growing in popularity around the world as an anonymous and simple way to trade with other people, anywhere on the planet. Starting back in 2009, Bitcoin offers users the ability to buy virtual currency through the system and sell it back to anyone else in the world who accepts it. While this is essentially no different from buying and selling with any national currency, Bitcoin attempts to act as a modern currency for the digital world and a true medium between all vendors in the world.
Their plans grow closer to reality every year, and now there is news of the imminent release of a Bitcoin debit card. The plan that the host company, Xapo, has for the card is that it will essentially allow you to use one card for everything. Your card will be linked to your Bitcoin account and Xapo will make the transactions between you and the merchant when you swipe—selling your Bitcoins and paying off the vendor. Having a card backed by virtual Bitcoins, rather than a national bank, would theoretically allow users to flash their card anywhere in the world without issues.
Bitcoin still has a long way to go before gaining global credibility, however. Most people remain skeptical of its reliability, and it is not backed by monetary value like banks are by the FDIC. Even still, it remains highly used throughout the online community, especially as it allows users to evade many of the various ways that the legal system has curtailed online activities.
One of the most prominent examples of Bitcoin being jumped on by the online community is in poker. Signed into law by President Bush in 2006, the Unlawful Internet Gambling Enforcement Act disallowed online sites from accepting payments for bets that would be considered unlawful in any state. In short, this bill made online poker illegal in the United States, and the impact on sites was tremendous.
PartyPoker, the world’s largest poker host at the time, immediately withdrew from the U.S. real-money market in order to avoid legal ramifications, as Jennifer Newell writes. Many other similar sites were unable to service players because of the bill, too, but that has not stopped the American demand for the hugely popular game.
Players have resorted to much more underground and less safe alternatives to the now-free major poker sites, which has helped give rise to the legitimate use of Bitcoin as a currency. As it is not a valid national currency, it is not restricted by the UIGEA. In the past few months, many mainstream sites are starting to accept Bitcoin as well as an alternative form of gambling for users. As it continues to grow in popularity, more and more of the online community is sure to follow.
Whether Bitcoin ever becomes truly mainstream remains to be seen. There is certainly enough drama surrounding it, including financial crises and economic bubbles, and many financial forecasters expect it to fail in the long run. However, it is likely far too early to tell. The potential is definitely in place for an international digital currency and a universal debit card certainly sounds like a neat idea for now.
Given the enormous potential of Bitcoin to become a mainstream traded commodity in the future, if you have not paid attention to it lately, it might be time to start. Many people are investing in the currency, and its value and reliability only increase as people form companies solely dedicated to the trade and upkeep of Bitcoin. Maybe it’s not a good idea to invest your children’s college fund in them just yet, but you just might be buying your daily Starbucks with Bitcoins in the 20s.
