Two weeks after Bitcoin prices hit the all time high of $230 on April 9th, the price of the virtual currency remain wildly volatile. In the 18 days since the peak, the daily closing price had movement of 12% on average in either direction, with the high of 36% gain on April 17th, from $68.36 to $93.07. The price has been driven by high volume, with average trade volume of 208,236 BTC over the course of the past 18 days, compare to 63,205 BTC over a 18 day period from two months ago.
Bitcoin became headline news about two weeks ago when the surge in price took the world by storm, if Bitcoin was not a mainstream currency before then, it has certain hit the radar of the casual investors by now.
Is Bitcoin a Legitimate Currency?
Lets put it this way, the banks worldwide are cautiously following the development of this virtual currency. Recently, two Bitcoin dealers in Canada had their bank accounts frozen by Royal Bank of Canada and TD Bank. The banks are skeptical at this point since there are unanswered regulations involving interstate and international transactions involved. Before the federal governments officially lay out plans for this currency, banks will take caution on this matter. A good comp may be the Euro currency when it first linked all the neighboring countries in Europe. Think about how long it took the European Union to standardize the Euro currency. If international commerce will be operating at an large scale using this currency, the federal governments need to appropriately decipher the potential risks and mitigate fraud.
The biggest risk that come to mind of course is money laundering. It is mind-blowing that an investor does not need to reveal their identity, investors are only required to reveal their identity if they plan on depositing over $50,000. The only personal data that mtgox.com collects during registration are the following:
- Preferred Currency Exchange
Of these data, only email can be considered personal information, which is still just a bona fide alias for people to hide behind.
How to Spend Bitcoin
For casual investors that can afford to invest their disposable savings, Bitcoin can be a great alternative investment option. Besides the great return on investment, Bitcoin has slowly becoming a mainstream currency accepted in retail stores.
From retail stores selling guitars, to booking a Hawaii vacation, some retail stores have found that it may give them an edge from their competitors by accepting the virtual currency. And guess what, you can buy a 900 square feet home sitting on 2.97 acre land for $405,000 worth of Bitcoins.