One of the biggest and most interesting news stories of the last few years has been the rise of bitcoin. A form of crypto (or underground) currency that is used to make transactions online, it has been around for a number of years. But until the last couple it has largely been ignored by the major financial institutions.
Used for making small transactions online, it was seen as the preserve of computer hackers and even had a slightly shady reputation. But things changed quickly. When currency speculators saw that the currency was rising in a spectacular fashion they began to get interested, fuelling the increase. People were making small fortunes trading in the currency, and it began to emerge into the mainstream.
The benefits of Bitcoin
The main benefit is the technology it uses, known as blockchain. Essentially, by making the currency more visible and accountable and spreading the data over millions of users, it cannot be controlled by any one organisation. Which makes it very safe and secure. And this is something that is very attractive to some people. So much so that the UK’s first houses have recently sold using Bitcoin.
In December, the Daily Telegraph reported that two homes had been sold using Bitcoin to pay the bill. They were purchased by people who had made money in the currency and were looking to turn this success into a bricks and mortar investment. This has encouraged developers such as Ed Casson, sales director of Go Homes, who are now listing houses in Bitcoin. They have 250 homes due for completion in 2018 and plan to list them in Bitcoin values. This includes homes for sale in Hertfordshire, Essex and East Anglia.
So, it is entirely possible that it will be possible to use Bitcoin to purchase homes right here in Norfolk. That is not something anyone thought all that likely five or so years ago.
Of course, the major risks of Bitcoin are that this is an entirely new way of storing wealth. And as such, no one is 100% sure if this can last. Like any bubble, there surely has to be a time when it can sustain its own weight no longer, and bursts. But, then again, if Bitcoin has been taken up by so many financial institutions, it may reach a point where it becomes ‘too big to fail’.
If businesses and homes are using Bitcoins for purchases, then this shows its legitimacy and perhaps indicates it is here to stay. The next six months will be crucial, so watch this space.
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