Virtual money, cryptocurrency, bitcoins are not just seemingly dubious earnings to many, but also our near future. Today, the Central Bank of the Russian Federation has begun work on creating a virtual national currency. However, first things first.
What is virtual currency?
Virtual (game) money, cryptocurrency - digital payment methods that are used for payment in virtual stores, as well as in social networks and online games for purchase:
- special gifts-pictures, stickers, rating upgrades;
- a certain status on the site or in the game, as well as expanding its user capabilities;
- artifacts, weapons, characters, equipment, "lives" in the game, etc.
Already in 2009, the gaming portal Zynga reported that this year alone it acquired virtual money and similar goods totaling $ 100 million.
In the report “Crypto Money Schemes” (2012) of the European Central Bank, virtual currency is interpreted as a kind of non-state-controlled digital payment methods created by developers and accepted by members of a certain virtual community.
The FinCEN (Financial Crimes Commission) of the US Department of the Treasury under the Bank Secrecy Act provides the following differences between cryptocurrency and real money:
- is not legal tender;
- in most cases not addressed;
- It is convertible if it has an equivalent in real money.
Benefits of Virtual Money
The virtual currency has a significant number of advantages over the usual means of payment:
- Convertibility . Transferring a certain amount from one cryptocurrency to another is a simple and quick process that can be done on your smartphone without interruption. At the same time, without even thinking about the commission.
- Safety It is electronic currency that is almost impossible to counterfeit, because it is protected by a rather sophisticated digital cipher. If the user complies with all the registration rules, even an experienced hacker will not be able to crack an e-wallet account in the payment system.
- Availability Electronic systems, unlike banks, operate around the clock. And you can instantly transfer the most varied amounts of money through them both to your neighbor and to a person located on the other side of the globe.
- Speed . Electronic money transfers are made almost instantly, regardless of the amount and remoteness of the addressee from you. However, they are not accompanied by any fees and commissions.
Virtual Currency Risks
At the same time, the list of obvious disadvantages of electronic money is quite extensive:
- For financial systems of states:
- the likelihood of terrorist financing;
- "laundering of money;
- risk of financial crime;
- may be used as a means of calculation when selling prohibited goods.
- For owners of electronic wallets:
- unprofitable courses when converting to real money;
- conversion fraud;
- probability of breaking an electronic wallet;
- inaccessibility of the wallet account in case of loss of the secret digital key to it, PIN code, etc .;
- loss of savings due to bankruptcy of the exchange site;
- cryptocurrency exchange rate instability;
- a small number of stores ready to accept this means of payment.
Cryptocurrency regulation
I must say that world governments were not enthusiastic about the growing popularity of virtual currency, responding to it with very strict methods:
- In 2013, the Central Bank of China prohibited local operators from servicing online exchanges trading in bitcoins (the most famous cryptocurrency today, which we will consider further), which reduced the cost of the latter by 38%.
- In the same year, the Indian Central Bank actually suspended the work on the territory of the state of one of the largest exchanges for operations with virtual money in this country - Bitcoin Buysellbitco.in.
- In 2014, the Central Bank of the Russian Federation called operations for transferring real money to cryptocurrency potentially dubious: in the event of a bankruptcy of the exchange platform or loss of access to an electronic wallet, the state will not be able to protect a citizen by law.
World famous cryptocurrencies
The list of virtual currencies traditionally begins with bitcoin, which was introduced in 2009 by a developer hiding under the pseudonym Satoshi Nakamoto. In early 2013, one bitcoin was valued at $ 20, and in November of that year - $ 323. At the end of 2013, one bitcoin was equivalent to $ 1,000, and in June 2017 - $ 3,000.
Such a "frantic" turnover led to the creation of more than 80 clones of this electronic currency, the number of which is growing steadily today:
- zeuscoin;
- worldcoin;
- peercoin;
- hobonickel;
- fireflycoin;
- gridcoin and more other
The Amazon online store in 2013 also distinguished itself by introducing its own currency, Amazon Coins, for its Amazon Appstore and a number of subsidiary applications, the unit of which is equivalent to 1 US cent . However, you can pay with such electronic coins only within the Amazon.
The main competitor of bitcoin on exchanges is considered litecoin, a project by software engineer Charlie Lee. According to the creator, transactions with his brainchild are 4 times faster than with bitcoin.
Bitcoin - what is it?
To understand the features of all crypto-money, consider for example the virtual currency Bitcoin, since all the rest are, in fact, copies of it.
Bitcoin (English bit - "bit", "information unit", coin - "coin"), as well as bitcoin, btk, btc - is a digital currency that works and is used only on the Internet. However, one can buy quite real goods and services for it, as well as exchange it for real money. Bitcoins can be purchased or sold on global exchanges along with other currencies.
The BTK is distinguished by the following:
- Decentralization . Not a single bank of virtual currencies, not a single institution in the world controls bitcoins.
- Issue . Bitcoins are only available in digital form. Moreover, their issue is not the traditional printing of Central Bank notes, but "mining" (mining) by ordinary users around the world. The script for the release of bitcoins can be run by anyone on their PC - it is in the public domain.
- Provision . Unlike real money, BTK is not provided by either gold or silver.
- Restriction . Bitcoin code allows you to "get" a maximum of 21 million units of this currency. However, it is divided into components ad infinitum. The smallest unit is named after the creator - Satoshi. It is equal to 0.00000001 btc.
- Use . To get a Bitcoin wallet in the payment system of the same name is a matter of 5 minutes, which is for an ordinary user, that is for a legal entity.
- Anonymity . Creating a Bitcoin wallet does not imply entering personal information - neither a name nor email.
- No commission for transfers.
- Instant translations.
- Irrevocability of the transaction . After sending bitcoins to a specific addressee, only he can return the currency back.
- Transparency If you tell someone the address of your bitcoin account, then this citizen can familiarize himself with the entire history of your transfer transactions.
Pros and Cons of Bitcoin
Information about the advantages and disadvantages of virtual currency - bitcoin - we put in the table.
| pros | Minuses |
| Anonymity | Some states may prohibit bitcoin payments on their territory. |
| Easy to use wallet | A small number of stores accepting this currency. |
| No fees for all transfers | Transaction Irrevocability |
| Transparency | |
| Speed of translations | |
Finally, let's talk about the prospects for cryptocurrencies in our country.
Russian virtual money
In the summer of 2017, the Central Bank of the Russian Federation began to develop a virtual currency of Russia. The beginning of this was the meeting of Russian President V.V. Putin with V. Buterin, the creator of the Ethereum cryptocurrency, which the Kremlin calls the second most important after Bitcoin. It is predicted that the new Russian cryptocurrency will be based on the development of Buterin.
It will be possible to speak about the first achievements of the project only after 2-3 years. So far, the Bank of Russia has determined the principles of electronic money regulation.
Virtual currency is the money of the future. But already today the excitement around her has not abated, and quite tangible material value is growing before our eyes, as can be seen on the example of bitcoin. Against this background, the government and the Central Bank of the Russian Federation forecast to implement a project on the creation of a national cryptocurrency.