Do you mine Bitcoin – and is it still worth it?

How much is one Bitcoin worth

Bitcoin Exchanges / August 19, 2022

Daniel Hertzberg

1. Bitcoin could be the tip of a dangerous iceberg

What is the future of money? Whether they involve jangling coins, folding bills, swiping plastic or making a few simple clicks online, most of the ways people pay each other involve banks and national currency systems. So-called virtual or cryptocurrencies offer something different: decentralized payment networks that let people transfer money without middlemen.

Of the 400 or so digital currencies in existence, bitcoin is the best-known and most mainstream. There are 13.1 million bitcoins in circulation (each worth about $600, though like other currencies they’re divisible in much smaller units). The number of bitcoin trading accounts, known as “wallets, ” reached 5.3 million in June, up nearly 700% from a year earlier, and about 63, 000 businesses world-wide now accept bitcoin, according to CoinDesk, which tracks digital currency prices and news.

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Advocates of virtual currencies say that they reduce transaction fees and create a level playing field for people without easy access to brick-and-mortar banks. “Anybody who has a connected device, anybody who has a mobile phone, has a bank in their pocket, ” says Barry Silbert, chief executive officer of SecondMarket and founder of the Bitcoin Investment Trust. For similar reasons, many people think digital currencies have enormous potential as investments.

But bitcoin’s recent history offers consumers many reasons to be wary. Unlike most traditional currencies, the value of a bitcoin can fluctuate wildly. And the collapse earlier this year of Tokyo-based Mt. Gox, the largest bitcoin exchange at the time, underscored the dangers of using or investing in an unregulated currency.

In a recent survey by research firm GfK, 79% of respondents said they would never use an alternative currency. And in a separate Harris Interactive survey released in March, only 6% said they would invest in Bitcoin rather than gold.