Bitcoin is a “virtual” currency that was developed in 2008 and has gained increased acceptance as a form of payment and as a recognized asset in currency exchange markets, as reflected by the granting in 2013 of “XBT” as its ISO currency code.  Alternative virtual currencies also have been established, but none has approached the popularity of bitcoin.

The founder (or, perhaps, founders) of bitcoin used the pseudonym of “Satoshi Nakamoto” and remains unknown, although certain news sources recently claimed to have identified him.  However, this founder was present on bitcoin blogs for some time, where he articulated that bitcoin was intended to be immune from the possibility of corruption by governments, central banks and other third parties because such entities would not be empowered to directly affect the issuance or exchange of the currency.  Instead, as further described below, bitcoin is a decentralized, peer-to-peer digital-payments system.  The Bitcoin Foundation, an advocacy group, “standardizes, protects and promotes” the use of bitcoin.  It has been primarily funded by grants from for-profit companies that depend on bitcoin, such as CoinLab (an investor in new technologies and business in the bitcoin marketplace), Mt. Gox (formerly a bitcoin exchange based in Tokyo) and BitInstant (formerly a means to rapidly pay traditional funds to bitcoin exchanges).  The latter two companies are now defunct. READ MORE →