Article

Bitcoin: The future of currency? [infographic]

Financial services execs everywhere are talking about Bitcoin, but some still don't get how it works. Here's a short-and-sweet tutorial.

June 5, 2014 by Will Hernandez — Editor, NetWorld Media Group

Bitcoin has taken some hits in the mainstream media the past six months, but you’d be hard-pressed to find a bank industry executive not talking about the cryptocurrency’s threat to legacy payments systems. Once they understand how it works, that is.

The infographic below, sponsored by Jumio and Bitcoin Identity Security Open Network, explains some of Bitcoin’s basic elements, including how to use it and some finer points about its volatile nature.

In a nutshell, Bitcoin was created to eliminate the middleman when two parties exchange payment for goods and services. No banks and third-party networks such as Visa or MasterCard are involved in the payment process. And the transaction is all but anonymous.

At the moment, some 12,450,000 bitcoins (the coin is small "b", the currency is capital "B") are in circulation at a value of roughly $6.5 billion. Bitcoin’s value fluctuates daily. A whole bitcoin was worth $1,104 at one point in the last five months.

Some have compared the current state of Bitcoin to the Internet in 1994 or 1995, so it should come as no surprise that investors such as Marc Andreessen (of Netscape fame) and the Winklevoss twins are jumping on the Bitcoin bandwagon. 

About Will Hernandez

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Will Hernandez has 14 years of experience ranging from newspapers to wire services and trade publications. Before becoming Editor of MobilePaymentsToday.com, he spent two years as the content manager for PaymentsJournal.com, a leading payments industry news aggregator and information hub published by Mercator Advisory Group. Will spent four years covering the payments industry as an associate editor for multiple publications in SourceMedia's Payments Group based in Chicago.

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