At the sidelines of a conference on the future of payments and currencies, Wozniak, a mathematician by training, explained why he thought Bitcoin was better than the US Dollar and Gold. Quipping that unlike Gold or the US Dollar, Bitcoin has a predictable finite supply and is tamper proof, Wozniak claimed Gold’s value will be diluted once more efficient methods of mining are invented. He also remarked that the US Dollar is ‘kind of phony’ due to the centralised control over creation and use, lending itself to abuse.
Adding that he admired Bitcoin from the very start, Wozniak said he wasn’t interested in the financial part of it but rather believed in the promise Bitcoin held as a currency. The tech geek also shared how he found it hard to buy Bitcoins in the early days after its launch. Comparing Bitcoin to a house, Wozniak said that no matter how much the price went up or the government taxed it, the house would still exist as a real stable asset, undiluted and worth what it’s made of. In the same way, he said, Bitcoin is limited in amount and nobody could ever dilute the supply, making it valuable as a stable asset.
The transaction process
The BTMs save Know Your Customer (KYC)/Anti Money Laundering (AMC) details, scrutinise them and report suspicious activity to the regulatory authority. After obtaining these details, the machines allow you to buy Bitcoin. The operators buy Bitcoin from exchanges and allow BTM users to withdraw Bitcoin from their wallets. One can buy as much Bitcoin as the operator holds.
Operating a BTM
In most jurisdictions, operating a BTM is a challenging task. BTM operators have to meet stringent regulatory norms. In the United States, operators have to register under the federal financial crimes enforcement network as well as obtain state-specific money transmitter licence.
Bitcoin Core is the original BTC client and is available for Windows, Mac and Linux. Core is a ‘full node’ Bitcoin client, meaning that on first-run it will download the current version of the blockchain (currently around 160GB) by connecting to other nodes. It will then continue to download and process data about Bitcoin transactions.
One advantage of this is that it’s much more difficult to link a specific BTC payment address to your identity as Core downloads data about all Bitcoin transactions everywhere. This also protects you against certain types of fraud such as someone trying to spend the same BTC twice, or fooling you into believing you’ve received funds you haven’t actually got.
US regulators’ scrutiny into Bitfinex, one of the world’s largest cryptocurrency, over its dollar-pegged digital token Tether has sent bitcoin sinking below $10,000.
Bloomberg is reporting that the US Commodities Futures Trading Commission (CFTC) has sent subpoenas to Bitfinex and Tether, the firm behind a namesake digital token that is directly pegged to the value of a US dollar and is used for widely used for trading among exchanges globally. While Tether says its $2.3 billion in tokens are backed by USD reserves, the CFTC and Tether’s skeptics have questioned that very claim.
In an interview with Channel News Asia, Sopnendu Mohanty – chief of financial technology at the Monetary Authority of Singapore, the country’s central bank, opined bitcoin will not cause a global financial crisis in the event of a price collapse. The central bank official insisted global regulators are “getting serious about this whole cryptocurrency market”, suggesting authorities would step in with regulations when bitcoin markets continue to grow globally.
In October, the head of Singapore’s central bank insisted that bitcoin itself didn’t need any oversight as a cryptocurrency. Instead, MAS chief Ravi Menon insisted a regulator’s focus ought to be on the abuse of cryptocurrencies for illicit financing and other illegal activities. “So, those [regulatory] requirements apply to the activity around cryptocurrency, rather than the cryptocurrency itself,” Menon said at the time.