The value of Bitcoin lies in investor confidence.

Absrtact: Free and open, central to the Internet as a symbol of the spirit, but greedy speculation is also destroying its future. The value of Bitcoin is not guaranteed, but the confidence of the players in the game becomes the object of crazy hype (especially in China), the mysterious

Free and open, and central to the Internet as a symbol of the spirit, but greedy speculation is also destroying its future. The value of Bitcoin is not guaranteed, but is the confidence of the players in the game, become the object of frenzied speculation (especially in China), the mysterious creators from the rules of the game to make huge profits, but also drug, money-laundering and assassination of the best choice for illegal transactions.

Since the advent of the Internet, hackers in the cyber world have dreamed of transcending the traditional country differences, geographical constraints, social systems, and creating a "utopia" of the virtual world of freedom of information, openness and harmony.

E-mail spans traditional geographic boundaries, Google search enables the free flow of information, Facebook makes the world a social village, and mobile Internet makes communication ubiquitous. These innovations of Internet technology subvert the traditional means of interaction between people, people and society, and also bring great impetus to social and economic development.

But compared to other areas, the financial sector "Babel Tower" to build progress is particularly lagging behind. Currencies are still issued by central banks, financial services are still under strict supervision, and cross-border trade and capital flows are subject to complex exchange rate changes and foreign exchange settlement. In essence, the financial order of the world is still in the hands of the old man and the Jew in the suit.

Hackers who believe in computer-altering worlds expect to have a virtual currency based on internet technology that transcends real-world financial systems, does not comply with the regulation of any one country or institution, and is free to circulate globally. The new era of money is virtual, only in the computer network, but also in the real world to trade and exchange.

Financial Utopia

This is the origin of Bitcoin. In essence, Bitcoin is the only way for hackers to create a virtual "ideal country" financial system. Without bitcoin, there are other virtual currencies. In fact, hackers create a virtual currency is not only Bitcoin, there are Litecoin, Freicoin, Ripple and many other types. They are either based on a Bitcoin protocol or a self-contained system. And Tencent, Amazon and other internet giants issued by the virtual currency also has a certain influence.

Bitcoin is not the first virtual currency, but it is currently the most influential, the most widely accepted currency; In the process of the popularity of Bitcoin, both hackers create a financial utopia of the simple ideal, there are a large number of speculators in the greed-driven frenzy of speculation, but also because of its hidden characteristics of the criminals as the best tool for the network of illegal transactions.

Bitcoin originated in 2009 and is an online financial network of Peer-to-peer (personal to personal, individual to individual); In a sense, Bitcoin networks are an organization-free Visa or PayPal, a stateless cross-border payment system. The network is not owned by any government or financial institution, but a computer network created by computers scattered around the world.

Like the real international financial system in the dollar as the benchmark currency, bitcoin network of the virtual financial system also has its own currency, this is the conventional sense, now the fried bitcoin. 2008, a pseudonym "Satoshi Nakamoto" (translated in China: In the Network forum, the person conceived and created the coinage principle of the Ben Cong-the computer runs special bit-currency software, contributes the CPU performance to compute, then obtains the reward "Bitcoin" from the network, this process also is called "Digging mine."

In accordance with the rules of Ching and others, the total number of Bitcoin will be fixed 21 million pieces. Therefore, this is also the second major feature of Bitcoin-a currency of deflation. It does not appear that bitcoin, like other real-world currencies, is flooded by the central bank's massive printing of money, which is forever protected by limited numbers. Any person who digs and buys a bitcoin does not seem to lose, because before bitcoin any financial service or institution would have to be subject to strict restrictions by the respective state and regulatory authorities, and would be faced with the access management of central banks, such as the Federal Reserve, to cooperate with existing commercial banks. But Bitcoin has absolutely no need to be constrained by these conventions, the first fully open financial system in global history and the complete disengagement from the existing international financial system.

Anyone who can access the Internet, in any corner of the world, can dig mines, buy, sell and redeem Bitcoin. In the process, it will not be restricted by any national central bank or financial institution (at least for now). For hackers and those who believe in the Internet's openness, the fragmented independence of Bitcoin is what they want to see-a world-wide virtual financial system that is free from national, regional and industrial constraints.

Freedom, preservation, openness, and the centrality of Bitcoin have made them the ideal cornerstone of financial utopia for hackers. As a result, Bitcoin has also been highly praised and promoted, and has become increasingly popular around the world over the next few years, and is receiving the real world at a faster pace.

With the sharp increase in bitcoin, the number of people involved in bitcoin coinage, trading, and circulation processes, such as the snowballing general phenomenon, has been expanded to participate in this. There is a direct purchase of computer mining coinage, there are buy Bitcoin want speculative profits, have to create Bitcoin trading platform. At present, there are more than 10,000 entities in the world to receive bitcoin, even with Bitcoin ATM machines, hackers can use Bitcoin to buy food, products, services, or even a house, can also be directly convertible to the real currency such as the dollar.

Adventurer's Paradise

As the founder of the historical milestone of Bitcoin, Ben Cong is like a ghost, only appears in the Virtual Network forum. No one has ever seen him, and his last appearance on the web was three years ago. It seems that the only value of the possible Japanese existence is to create the infrastructure of Bitcoin in 2008, and then the first batch of mining to create a lot of Bitcoin, then disappeared behind the computer network.

Perhaps, this Ben Cong is not a person at all, but a mysterious organization that creates bitcoin and profits from it. The reason is simple, according to the bits he created, the amount of bitcoin is fixed, and as the number of people involved in digging is increasing, the coinage process becomes more and more difficult. For example, if the 2009 computer successfully "dug up" to obtain 50 Bitcoin, then now the reward is only 25, and 2016, only 12.5 of the results.

Now the global computer created a total of 12 million bits, and in accordance with the smart set of Bitcoin play, the world can only have 21 million bitcoin. In other words, the sooner you get involved in the game, the more Bitcoin you will have. And later people will never be able to have more bitcoin than they would have if they had been frantically digging into computer hardware.

And as the creator of Bitcoin, there is reason to believe that Ben Cong (myself or an organization) and the original participants and advocates have amassed a huge amount of Bitcoin. It has been reported that Ben Cong own more than million bitcoin. By current value alone, Ben Cong has become a billionaire with Bitcoin. If Bitcoin's hype continues, the wealth of the original founders of Ben Cong and Bitcoin will only grow wildly like a snowball.

In fact, the person who profited most from the bitcoin mechanism was the Ben Cong of the Bitcoin creator and his original supporters, such as the Bitcoin Foundation (Bitcoin Foundation). In this respect, Bitcoin and real money are no different, completely lose the sense of fairness, perhaps this is what hackers and geeks do not want to see. If a currency is highly concentrated and only in the hands of a few people, the function of circulation will be greatly limited.

Creating Bitcoin alone is far from enough. As a currency, to enter the market circulation, has its own value, it must be guaranteed by the State institutions (such as paper money), or like gold as a precious metal has real value. Bitcoin, by itself, is the result of a computerized operation that is not guaranteed by national central banks because it is a borderless, unregulated, open world virtual currency.

The value of Bitcoin is simply how many people believe and are willing to participate in the game. Sounds, this principle of value recognition is very similar to MLM organizations or "Ponzi schemes": As long as more and more people are involved in the coinage, circulation and trading process of Bitcoin, the value of Bitcoin becomes higher because of its deflationary nature, and the initial participant or on-line development, will become richer with the increment of bitcoin.

Bitcoin's coinage process requires a lot of computer computing, high performance computer hardware, and a huge power consumption. But if the value of Bitcoin is not recognized, the investment in these coinage processes is worthless. To put it simply, digging a mine machine to extract gold can bring huge rewards, but if it is mined, it will not be worth much upfront.

Because the value of Bitcoin is the confidence of investors, once the rumours of the future of Bitcoin regulation or other positive and negative news, their value will fluctuate sharply. On April 19 This year, the value of Bitcoin plunged by half within half an hour, from 900 to 650 dollars. The real value of Bitcoin fluctuates, crazier than any capital market. This feature makes Bitcoin almost impossible to become a benchmark currency, more likely to assume the role of the currency, and Bitcoin trading participants must bear the enormous risk, easy to become the victim of speculators speculation.