26 October 2015

Letter from Lhasa, number 377. Decoding Bitcoin

Letter from Lhasa, number 377. Decoding Bitcoin
by Roberto Abraham Scaruffi

Kramer, C., Decoding Bitcoin. All You Need To Know About The New World Currency, Cooltura, 2015.
(Kramer 2015).
Claude Kramer


In a few words, this booklet represents what bitcoin be:
“Bitcoin is a system of peer-to-peer relationships that form a network and, using the Bitcoin software, create a new digital currency, the only currency not issued by any Central Bank. Unlike other systems, Bitcoin is a decentralized monetary system which is not governed by the laws of any public or government body.”

New bitcoins, until a prefixed amount, are mined solving an algorithms, what only powerful computers and computers’ networks can do, at high costs so that there be not a real seigniorage, or be it reduced. 

The inconvenience is that the value, so the exchange rate, of bitcoin is extremely volatile. A more serious inconvenience is that it could be easily sunk since governments’ interferences against it.

The use of bitcoins is relatively anonymous. At the same time, there are serious security issues, as many cases have demonstrated. A normal bank may be rescued from government. Sometimes hacked sums may be recovered from the owner. On the contrary, bitcoin transactions are irreversible. What is eventually stolen is stolen and lost from the legitimate owner.  

Using bitcoins one avoids the banking system, although one may need specialized companies for selling and buying bitcoins, so for exchanging them with other currencies.

For details about the bitcoin algorithms and other technical aspects of bitcoin, one needs more specialized literature. This is only a short booklet for a very fast introduction to this bitcoin new world.



Kramer, C., Decoding Bitcoin. All You Need To Know About The New World Currency, Cooltura, 2015.