Virtual money, cryptocurrency, bitcoins - this is not just a seemingly dubious income for many, but also our near future. Already today, the Central Bank of the Russian Federation has begun work on creating a virtual national currency. However, first things first.
What is virtual currency
Virtual (game) money, cryptocurrency - digital means of payment that are used for payment in virtual stores, as well as in social networks and online games for purchase:
- special gift-pictures, stickers, rating boost;
- certain status on the site or in the game, as well as expanding your user experience;
- artifacts, weapons, characters, equipment, "lives" in the game, etc.
Already in 2009, the gaming portal Zynga reported that during this year alone virtual money and similar goods were purchased from it for a total of $100 million.
In the report "Cryptomoney Schemes" (2012) of the European Central Bank, virtual currency is interpreted as a type of digital means of payment not regulated by the state, created by a controlleddevelopers and hosted by members of a specific virtual community.
FinCEN (Financial Crime Commission) of the US Department of the Treasury, under the Bank Secrecy Act, cites the following differences between cryptocurrency and real money:
- not legal tender;
- not used in most cases;
- is convertible if it has a real money equivalent.
The benefits of virtual money
Virtual currency has a significant number of advantages over our usual means of payment:
- Convertibility. Transferring a certain amount from one cryptocurrency to another is a simple and quick process that can be done on your smartphone while on the go. At the same time, without even thinking about the commission.
- Security. It is the electronic currency that is almost impossible to fake, because it is protected by a rather sophisticated digital cipher. If the user complies with all registration rules, even an experienced hacker will not be able to hack an e-wallet account in the payment system.
- Accessibility. Electronic systems, unlike banks, operate around the clock. And you can instantly transfer various amounts of money through them both to your neighbor and to a person located on the other side of the globe.
- Speed . Electronic money transfers are made almost instantly, regardless of the amount and distance of the sender from you. However, they are not accompanied by any fees andcommissions.
Risks of virtual currencies
At the same time, the list of obvious disadvantages of electronic money is quite extensive:
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For financial systems of states:
- probability of terrorist financing;
- money laundering;
- risk of financial crime;
- may be used as a means of payment for the sale of prohibited goods.
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For owners of electronic wallets:
- unfavorable rates when converted to real money;
- fraud during conversion operations;
- probability of hacking an electronic wallet;
- inaccessibility of the wallet account in case of loss of the secret digital key to it, PIN code, etc.;
- loss of savings due to the bankruptcy of the exchange site;
- instability of the cryptocurrency rate;
- few stores willing to accept this payment method.
Cryptocurrency regulation
I must say that world governments were not enthusiastic about the growing popularity of virtual currency, responding to it with very harsh methods:
- The Central Bank of China in 2013 banned local operators from serving online exchanges trading in bitcoins (the most famous cryptocurrency today, which we will definitely consider below), which reduced the cost of the latter by 38%.
- In the same year, the Indian Central Bank actually suspended work in the territorythe state of one of the largest exchanges for operations with virtual money in this country - Bitcoin Buysellbitco.in.
- In 2014, the Central Bank of the Russian Federation called transactions for the transfer of real money into cryptocurrency potentially doubtful: in the event of the bankruptcy of the exchange platform or the loss of access to an electronic wallet, the state, according to the law, will not be able to protect a citizen.
Famous world cryptocurrencies
The list of virtual currencies traditionally begins with bitcoin, which was introduced in 2009 by a developer hiding under the pseudonym Satoshi Nakamoto. At the beginning of 2013, one bitcoin was valued at $20, and in November of the same year it was $323. At the end of 2013, one bitcoin was equivalent to $1000, and in June 2017 - $3000.
Such a "mad" turnover led to the creation of more than 80 clones of this electronic currency, the number of which is steadily growing today:
- zeuscoin;
- worldcoin;
- peercoin;
- hobonickel;
- fireflycoin;
- gridcoin and more. others
The Amazon online store in the same 2013 distinguished itself by introducing its own Amazon Coins currency for its Amazon Appstore and a number of child applications, the unit of which is equivalent to 1 US cent. However, you can only pay with such electronic coins within Amazon.
The main competitor of bitcoin on the exchanges is litecoin, a project of software engineer Charlie Lee. According to the creator, transactions with hisbrainchild pass 4 times faster than with bitcoin.
Bitcoin - what is it?
To understand the features of all crypto-money, let's consider the virtual currency bitcoin as an example, since all the rest are, in fact, copies of it.
Bitcoin (eng. bit - "bit", "unit of information", coin - "coin"), as well as bitcoin, btc, btc is a digital currency that works and is used only on the Internet. However, it can be used to buy very real goods, services, and even exchange for real money. Bitcoins can be bought or sold on global exchanges just like other currencies.
BTC is distinguished by the following:
- Decentralized. No virtual currency bank, no institution in the world controls bitcoin.
- Emission. Bitcoins are issued only in digital form. At the same time, their emission is not the traditional printing of banknotes of the Central Bank, but "extraction" (mining) by ordinary users around the world. The script for issuing bitcoins can be run by anyone on their PC - it is in the public domain.
- Provision. Unlike real money, BTC is not backed by gold or silver.
- Restriction. The bitcoin code allows you to "mine" a maximum of 21 million units of this currency. However, it is divided into components ad infinitum. The smallest unit is named after the creator - Satoshi. It is equal to 0.00000001 btc.
- Use. Starting a bitcoin wallet in the payment system of the same name is a matter of 5 minutes for both an ordinary user and a legal entity.
- Anonymity. Creating a bitcoin wallet does not involve entering personal information - no name, no email.
- No transfer fees.
- Instant transfers.
- Irrevocable transaction. After sending bitcoins to a certain addressee, only he can return the currency back.
- Transparency. If you tell someone the address of your bitcoin account, then this citizen can get acquainted with the entire history of your transfer transactions.
Pros and Cons of Bitcoin
Information about the advantages and disadvantages of the virtual currency - bitcoin - we have placed in the table.
| Pros | Cons |
| Anonymous | Some states may ban bitcoin payments on their territory |
| Ease of use of the wallet | Small number of shops accepting this currency |
| No fees on all transfers | Irrevocability of transactions |
| Transparency | |
| Speed of transfers |
Finally, let's talk about the prospects of cryptocurrencies in our country.
Russian virtual money
In the summer of 2017, the Central Bank of the Russian Federation began to develop a virtual currency for Russia. This was initiated by the meeting of the President of the Russian Federation V. V. Putin with V. Buterin, the creator of the Ethereum cryptocurrency, which the Kremlin calls the second most important after bitcoin. It is predicted that the new Russianthe cryptocurrency will be based on the development of Buterin.
It will be possible to talk about the first achievements of the project only in 2-3 years. While the Bank of Russia is determined by the principles of regulation of electronic money.
Virtual currency is the money of the future. But even today, the excitement around it does not subside, and quite tangible material value is growing before our eyes, as can be seen in the example of bitcoin. Against this background, the government and the Central Bank of the Russian Federation predict to implement a project to create a national cryptocurrency.
