The hearing in the Senate is to determine how regulatory agencies and law enforcement officers are going to regulate the virtual currency. Before the actual meeting, it has been reported that the SEC and the Department of Justice are going to tell the U.S. Senate Committee that the Bitcoins are legitimate financial instruments.
Bitcoin is a four year old company and is not backed by any central bank, but can be traded on several different exchanges and even swapped privately. There are also many merchants that are beginning to accept the Bitcoin as a payment since the costs of the transaction are usually lower than using debit or credit cards.
The discussions on the Senate regarding Bitcoin are coming at a crucial time as the currency has reached a value of $600 for the first time ever. The recent surge of trading in Asia is what is driving the impressive growth of the virtual currency.
The hearing was originally prompted due to the shutdown of the Silk Road website that was responsible for over $1.2 billion in Bitcoin transactions for over two years, prior to being seized by the FBI.
Up until recently, the prices for Bitcoin have been very volatile. The currency jumped to a record back in April of $265 as general interest in the virtual currency increased. However, in October after the bust of the Silk Road website by the FBI, the price fell to $90.
If Bitcoin is going to represent the future of money, it is important that it reaches a consistent value. People want to have confidence that their cash will have the same value that it did the day before.
June 25, 2014 at 06:42PM
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