The spike in its price has some believing that it has become overvalued in a short period of time, owing to its limited supply and increasing demand. A narrow asset class and lots of liquidity is the perfect environment for a rapid burst up in value, and then corrections,” said Sebastien Galy, a currency strategist at Societe Generale in New York. Bitcoin trades 24 hours a day, every day. Bitcoin is not backed by physical assets and is not run by any person or group. Its value depends on people’s confidence in the currency.
It has been gaining acceptance by the general public and investment community but has yet to become an accepted form of payment on the websites of major retailers such as Amazon. Earlier in the month, the U. Senate held a hearing on virtual currencies, with some officials expressing concern that it is notable for its use in criminal activity and that there is a lack of regulatory oversight. But bitcoin advocates say last week’s Senate hearing gave more legitimacy to the currency, in part fueling the gains.
It isn’t just the bitcoin community saying that bitcoin is used for good things and there’s a lot of great potential. We have members of Congress and government agencies who all agree,” said Jinyoung Lee Englund, spokeswoman for the Bitcoin Foundation in Washington. Bitcoin is valued by many users for its anonymity. But government officials expressed concerns that many virtual currency services do not have the proper controls in place to prevent illegal activities such as money laundering. Virtual currencies, perhaps most notably Bitcoin, have captured the imagination of some, struck fear among others and confused the heck out of the rest of us,” Senator Thomas Carper told the Senate Homeland Security Committee earlier this month. In October, federal authorities shut down an online marketplace called Silk Road that was used for purchasing drugs and hiring hit men.
6 million worth of bitcoin, which was used instead of cash or credit cards to complete transactions on Silk Road. More than 200 bitcoin businesses and other merchants are participating in a bitcoin Black Friday shopping event, where users can buy everything from airplane tickets to Christmas trees to organic beer. Share your story, photo or video about something you’ve seen. Start your day with Sudbury Star Choose among a variety of subscription packages and stay up to date with convenient home delivery and our on the go digital e-edition. A member of Sun Media Community Newspapers part of Postmedia Network. Prices for bitcoins have soared in recent hours, building on gains during March that were fueled by the Cyprus crisis.
Bitcoins are appealing for several reasons. To depositors in places like Cyprus, or Spain, who are fearful of seeing their assets taxed, they can be viewed as an alternative store of value. And to those who distrust central governments and central banks, they offer a vision of an economic future free from all the corrupting influences of politics and government. They are, however, currently exhibiting many signs of a classic bubble, according to Societe Generale analyst Sebastien Galy. Galy wrote in a research note Wednesday. ADP, other disappointing data raise specter of spring U.