Category Archives: Bitcoin

So, youve bought Bitcoin (or another cryptocurrency) and hey! its shot up in value. Good for you. But what do you do with your digital money now? If youve made a serious profit, you might be wary of leaving it on an exchange such as Coinbase or stashing it in an online wallet (after all, North Korean hackers have reportedly stolen almost $90,000 of Bitcoin in the last two years). The most secure alternative is to take your currency offline altogether with a hardware wallet. This is a purpose-built, secure device for cold-storing the private keys that allow you to spend your digital currency. Two of the most popular are the Ledger Nano S and the Trezor, both of which employ open-source code (meaning that even if the companies were to fold, the devices would not be rendered obsolete). We tested them both

The Ledger Nano S looks like a USB stick, except it comes with a tiny screen that means you can operate it independently of your computer (as otherwise it would be vulnerable to malware). The controls are pared back to two buttons on the top of the device, which are used for everything from scrolling through menus to entering your PIN.

Set-up is simple. On-screen instructions take you through configuring your PIN and randomly generating your passphrase. The passphrase is important. If you were to lose or break the device, you can restore your entire balance on a new Ledger by entering this 24-word phrase.

Next, you download a set of Chrome extensions: a main device manager, and wallets for the different currencies you hold. Ledger currently supports Bitcoin, Ethereum / Ethereum Classic, Ripple, Litecoin, Dogecoin, Zcash, Dash and Stratis. If you wish to send or receive currency you do so via these browser-based apps, and your Ledger will ask you to press buttons to confirm that you do indeed want to carry out that function. Without the Ledger plugged in, moving your currency is impossible.

Pros: This is a compact device that has found clever systems to make a two-button control system viable. It supports a multitude of currencies, and is the most affordable of the two hardware wallets on test.

Cons: The build quality on our model could have been better. The left-hand button often registered one click as two, and it encountered problems a number of times during setup, though we succeeded eventually.

61, ledgerwallet.com

The Czech-built Trezor which translates as vault in its native language has many similarities with the Ledger. It, too, has a screen that means you can use it to keep your money safe even on an infected computer, and operating it also comes down to two buttons. The set-up is similar as well its all about choosing a PIN and a 24-word passphrase that allows you to restore the device. How you interface with this dongle from your computer, however, is rather different.

Whereas the Ledger asks you to tap away on its buttons in order to input your PIN, the Trezor displays the numbers 1 - 9 in a random formation, and asks you to click the corresponding buttons on a digit-less pad displayed on your computer screen.

The Chrome app through which you control your Trezor and your wallets is slicker than the Ledgers. It involves opening fewer windows, and the visuals are rather more glossy though it essentially offers the same functionality. It feels like a more expensive product, and it is. The only downside is that, for now, it lacks support for currencies such as Ripple.

Pros: Higher production values, both in terms of software and hardware.

Cons: Fewer currencies supported.

76, trezor.io

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So, you've bought Bitcoin. Now what? - GQ.com

A bitcoin ATM in Barcelona in 2014.

Josep Lago/AFP/Getty Images

Back in early 2014, thanks to a confluence of digital malfeasance and wide-eyed optimism, bitcoin enjoyed a nice run in the headlines. Things have since quieted in the popular press, but venture capitalists, entrepreneurs, and speculators have continued to work toward the promise of a secure, fast, and cheap payment system that cuts out fee-hungry banks and credit card companies. Following Bitcoins lead, theyve built dozens of competing cryptocurrency systems, and while digital coins arent part of most peoples everyday lives today, its increasingly clear that they will be, sooner or later.

Bitcoin itself, however, wont necessarily be part of the future it has ushered in. A broad surge in cryptocurrency values pushed the original recipe north of $40 billion in late May, but a long-standing issue that limits the systems capacity has left it struggling to give users what it says on the tin: a cheap, quick way to move money. Because bitcoin is open-source and democratically managed, a huge number of stakeholders are wrangling over how to solve this scaling crisis, which hinges on an obscure technical parameter.

In response, the bitcoin community has split into two factions that tout mutually incompatible solutions while accusing each other of incompetence, conspiracy, self-aggrandizement, and generally being the devil. On March 17, more than two-dozen bitcoin marketplaces issued a joint letter warning that there is a very real possibility that a Bitcoin network split may occur in the future if the conflict isnt resolved. It was one of the first high-level acknowledgments that, just as it begins to fulfill its promise, Bitcoin could be torn in half.

The idea of a Bitcoin split, or the extremely personal infighting that has made it a possibility, would have seemed laughable just a few years ago. Then, a tight-knit crew of bitcoin pioneers gleefully nerded out over an arcane innovation with world-changing potential. At the heart of bitcoins radical promise is the so-called blockchain, essentially a ledger where transactions are recorded. But instead of some spreadsheet living on a single computer, the blockchain exists on thousands of servers worldwide that constantly monitor one anothers copies of the ledger. This makes the network essentially unhackablean astonishing achievement of computer science and economic engineering.

Since a still-anonymous creator introduced bitcoin in 2009, its central innovation has given birth to a diverse and thriving ecosystem. There are now dozens of other cryptocurrency systems, with names like Ethereum, Dash, and Ripple, many with more features than Bitcoin. Perceived instability in Bitcoin could eventually push investors and developers to these alternatives. But more profoundly, Bitcoins inability to solve its own problems would cast doubt on its core libertarian-democratic premise: that people dont need the government or banks to manage their currency.

If Bitcoin were to split, it will be because it was just too successful for its own good. Public interest and transaction volume has grown more or less steadily for the past five years, and the blocks that make up the blockchainbundles of about 2,000 transactions compiled every few minutesare getting very crowded. Some transfers can currently wait hours, even days, to go through.

Users can pay a fee to have their money moved first, through a bidding process that is becoming increasingly fierce. Before 2014, bitcoin transactions were effectively free. By October, users had to pay operators about 13 cents to get speedy resolution. Today, that average fee is closer to 50 cents. That removes some of bitcoins appeal as an alternative to, say, Visa, which charges merchants about 10 cents for small transactions or about $1 for the average swipe.

Almost everyone admits this is a problem, but bitcoiners are divided into two camps over how to solve it. One faction is led by Roger Ver, a very early funder of Bitcoin startups who has relentlessly proselytized for the technology since 2011. Among the cultish ranks of bitcoin boosters, Vers commitment and vision earned him the nickname Bitcoin Jesus. Now, he has taken up the banner of Bitcoin Unlimited, a solution to the scaling issue that would directly increase the codes limit on how much data a block can hold.

While this would make bitcoin faster and cheaper for users, critics say it would also make it more expensive to run a server. For this heresy, Vers enemies have rechristened him the Bitcoin Antichrist. One of his main allies, the Chinese server manufacturer Jihan Wu, has been similarly dubbed Jihad Wu, complete with a satirical Twitter account that paints him as an ISIS-style terrorist.

The main competing proposal is offered by Bitcoins central development team, Bitcoin Core, and is known as Segregated Witness, or SegWit. It would free up a smaller amount of space for transactions, while making it easier for secondary systems to handle smaller transactions outside of the main, super-secure blockchain. But it could leave bitcoin proper nearly useless for small transactions.

This may sound like a technical squabble among quislings. But the two solutions imply two fundamentally different visions of what bitcoina system that currently has a higher market value than Credit Suisseshould be. Those who support Vers vision of larger blocks want bitcoin to be a day-to-day, open payments network, usable to buy anything from a cup of coffee to a car. Those who support SegWit are more likely to see bitcoin as digital gold, a long-term store of value that wouldnt move around that much. That would leave fees high but make paying them less necessary, while relying more on secondary systems.

The two factions congregate on separate, opposing Reddit forums where they each tout their solution while meme-trolling the enemy. Each accuses the other of sockpuppetingusing fake social media accounts to create the impression of popular support. (And each side, of course, denies in engaging in such behavior.)

If Bitcoin were a company, youd expect the CEO to sort out his or her underlings petty backbiting. But Bitcoin has no leaders. Instead, the miners that run Bitcoins servers essentially vote on any proposed changes. For years, the consensus version of the software was distributed by the slowly rotating Bitcoin Core team and adopted with little controversy. Core had no official authority, but its expertise was broadly trusted.

But many miners have lost faith in Core, accusing it of moving too slowly to tackle the scaling issue. According to tracking site Blockchain.Info, a little more than 40 percent of miners are currently signaling their support for Bitcoin Unlimited, compared with only 30 percent signaling for SegWit. If more than 50 percent of miners were to support Bitcoin Unlimited, they could force a shift in the entire network. Ver, though, says he would like to see much more decisive margins of support before any changes are implemented, and SegWit requires support from 95 percent of miners before it can be activated.

With each faction so firmly entrenched, theres no sign things will sharply swing either way any time soon. But a smaller group of miners could branch off to form a separate network and an entirely new currency. This split, known as a hard fork, is what the exchanges that issued the March letter were planning for.

Not everyone thinks a hard fork would be a bad thing. Anthony Di Iorio was one of the founders of Ethereum, the most prominent system to innovate on bitcoins core ideas. Should there be a hard fork, he predicts, youre going to have better growth. [Users] will be able to decide. Competition is good. Ver, unsurprisingly, describes a fork as not a big problem at all.

But othersnaturallydisagree. Reggie Middleton is a financial analyst focused on cryptocurrency and runs the decentralized trading platform Veritaseum. A Bitcoin Unlimited fork would be destructive to the economic value of the [Bitcoin] network as a whole, he says, in part because the strength of any payments system hinges on its size.

Middleton is also concerned about Bitcoin Unlimiteds implications for bitcoins governance. Like Ver and most longtime bitcoin supporters, hes a staunch critic of government and corporate power, attracted to bitcoin because it promises to free currency from control by old regimes. But Bitcoin Unlimiteds larger blocks would require more computing power, storage, and network bandwidth to process, which could concentrate mining in fewer hands, making the system both less secure and less democratic.

Once you centralize it, says Middleton, you open it to threats. It would become like the banking system, which is basically greedy middlemen who stand between you and your money. For bitcoin die-hards, there is no greater slur than comparing something to a bank.

For bitcoin die-hards, there is no greater slur than comparing something to a bank.

Ver thinks this position is ridiculous. Bitcoin was once a true grassroots project, with ramshackle servers toddling along in peoples basements and dorm rooms. But the system has already become vastly more power-hungry: Ver points out that a single usable mining server, and its voting power, today costs $1,000 or more. In other words, bitcoin is still a radical political project, but its also big business, and its time to come to terms with that.

Jeff Garzik has a unique perspective on the public bloodletting. Before spending four years as part of the Bitcoin Core team, Garzik was a leader at Red Hat, which helped make the open-source Linux system digestible for corporate users. Someone had to play that insulating role, because it was common for Linuxs democratic community of developers to engage in ideological warfare over lines of code.

But Garzik says that even Linuxs biggest battles cant compare to the hate swirling around bitcoins block-size debate. While Linux fights might have broken out over engineering approaches, and early bitcoin debates revolved around ideology and theory, Garzik thinks something much less abstract is driving bitcoins current unrest: money.

At this point, more than $1.5 billion in venture capital has gone to support blockchain startups, and many have business models that would be affected by how the block-size problem is solved. Blockstream, which employs some Bitcoin Core developers, builds sidechains, the sort of secondary system that would be more in demand if bitcoin itself doesnt start accepting more transactions. On the other hand, theres BitPay, which has sold merchants the idea of bitcoin as a low-fee retail payment system, and for whom the strangled state of the bitcoin blockchain has been a serious headache.

Youre asking developers, in effect, to pick winners and losers in the market, says Garzik.Theres no right answer.

But there could be a wrong answer. A miscalculated change could disrupt bitcoins basic economics, a fine balance of computing costs, coin value, and network demand. And all of those competing blockchains are waiting for a mistake. If bitcoin were to recede, that will be sad for me, says Ver. If theres another iPhone thats better, thats sad for my old iPhone. But it means we get to use a better one. Ver has outlined this endgame scenario on the same portal that he established years ago as a friendly invitation to new bitcoin users. Bitcoin Jesus is now preaching about the looming bitcoin apocalypse.

The viciousness and intractability of the scaling fight could suggest a flaw at the heart of bitcoins core democratic ideals. Maybe, in the end, we really do need authority figures to make big decisionsespecially when theres money on the line. But Charlie Shrem, another early bitcoin entrepreneur who now supports the SegWit solution, focuses on the fact that the software has stood firm amid the chaos. Changes that can hurt the network cant happen easily. Its the same thing with changes that can make the network better. Its what makes the network strong. Its beautiful. His opponent, Ver, sees the same silver lining.

Its not surprising that the two would share a sanguine perspective on the chaos gripping their lifes work. Though nominally antagonists today, Shrem and Ver have a friendship rooted in years in the bitcoin trenchesVers first investment was in Shrems bitcoin payment startup. Shrem says Ver (along with a lot of other people who hate each other on the internet) will attend his upcoming wedding.

In the aftermath of the exchanges March letter, the tension over scaling has continued to ratchet up slowly. New proposals have attempted to break the standoff between Bitcoin Unlimited and SegWit, including one that some say subverts bitcoins basic decision-making process. A version of the SegWit solution was successfully activated on the bitcoin alternative Litecoin, demonstrating that its ready for the big leagues. But still, the deadlock holds, bitcoin is left with the slow and expensive status quo, and neither side is truly happy.

And maybe thats just what democracy looks like.

This article is part of Future Tense, a collaboration among Arizona State University, New America, and Slate. Future Tense explores the ways emerging technologies affect society, policy, and culture. To read more, follow us on Twitter and sign up for our weekly newsletter.

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Bitcoin's King Solomon Moment - Slate Magazine

New York Times

Ask the Sketch Guy: Should I Finally Buy Some Bitcoin? New York Times To kick off things, Shawn Cook from San Diego asked a question about Bitcoin. (For an explainer on Bitcoin, see this article by Nathaniel Popper of The New York Times, who literally wrote the book on the topic.) His hipster friend is constantly bugging ...

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Ask the Sketch Guy: Should I Finally Buy Some Bitcoin? - New York Times

BBC News

US bitcoin conman hit with $12m fine - BBC News BBC News The fraudulent scheme netted the Connecticut conman about $20m, say US prosecutors. Bitcoin Mining Companies Lose Judgment To SECETHNews Bitcoin Ponzi schemes slammed with $12 million penalty | ZDNetZDNet Person behind Bitcoin Mining Scam Faces $12 Million FinenewsBTC SEC.gov all 9 news articles »

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US bitcoin conman hit with $12m fine - BBC News - BBC News

Bitcoin Magazine

Price Analysis: Cryptocurrencies Hit $100 Billion Market Cap as Bitcoin Reaches for New Highs Bitcoin Magazine Bitcoin approaches a new all-time high (ATH) in price and market cap as we re-enter a mode of price discovery. All of this occurs in the settling of an unresolved block size and scalability debate set to be disrupted with the UASF on August 1 ... Bitcoin Alert: New All-Time High For The CryptocurrencyHacked Briefly: Lifeguard Video Test, Target's Game Sale, Bitcoin Price SurgeLifehacker Australia Bitcoin and Ethereum are hitting record highsBusiness Insider Australia all 7 news articles »

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Price Analysis: Cryptocurrencies Hit $100 Billion Market Cap as Bitcoin Reaches for New Highs - Bitcoin Magazine

If you're interested in getting invested in the digital currency world, now seems to be as good a time as ever. Bitcoin has seen repeated record-setting price levels, and a host of other digital currencies are becoming increasingly popular around the globe. And yet, there are some reasons why even seasoned investors may be reluctant to get involved in direct investments relating to cryptocurrencies. Fortunately for those people, there is an exchange-traded fund focusing on Bitcoin in particular that can simplify the process. It is called the Bitcoin Investment Trust (GBTC) and it is provided by Grayscale Investments. Here are some of the basic details about the new ETF and its relationship to the digital currency itself.

The Bitcoin Investment Trust sported a tremendous 248% increase in the month of May. This far surpasses the gains of 72% overall for the Bitcoin-U.S. dollar currency cross. With that figure in mind, investors may be jumping to get access to GBTC shares. However, there are other factors to consider as well.

First, May's performance seems to be a relative anomaly for the ETF. For the three months prior to May, Bitcoin performance superseded ETF performance two months. This suggests that the two are actually more neck-and-neck than May's figure would suggest. Second, investors looking to buy into GBTC should keep in mind that the shares of the ETF are currently trading at more than double the cost of Bitcoin itself, according to a report by Business Insider.

Potential investors are likely wondering why GBTC shares can be found at such a high premium over Bitcoin. The issue seems to lie in supply and demand. While Bitcoin demand has skyrocketed, GBTC has kept its shares outstanding close to 1.7 million in the two years that it has existed. In fact, the ETF seems unlikely to change the number of total outstanding shares in the future, according to the company's head of research, Ihor Dusaniwsky. He explains that "with the operational risk of buying and holding actual Bitcoins to support ETF creation very high, and difficult and expensive to insure, it is unlikely that GBTC's outstanding share amount will climb above 1.7 million anytime soon."

It is useful to note that GBTC didn't always seem this expensive in comparison with Bitcoin. Before Bitcoin's price spiked in the past several weeks, the ETF traded on an average premium of just 10% above the cryptocurrency in 2017. The issue seems to have come about when Bitcoin's demand blew up and GBTC's supply did not change. As Bitcoin continues to spread further into the financial world, it will be interesting to see where GBTC's share prices go as well.

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Why Buy This Bitcoin ETF Instead of Actual Bitcoin? | Investopedia - Investopedia

Many people express a fear in the cryptocurrency forums that we are in a Bitcoin bubble, with prices growing too fast due only to speculation. But I guess no one told this to Asian traders, as the BTC/USD exchange rate just went over $2877for the first time, rising another 10% day-over-day mainly due to high trading volumes in Korea, Japan and China.

The London Summit 2017 is coming, get involved!

To put this meteoric rise in some perspective, only at the start of March 2017 we reported thatthe price of Bitcoinsurpassed that of an ounce of goldfor the first time. Now, with gold trading at just $1,287, Bitcoin is much more than double the value of the precious metal used as currency since the beginning of history.

In terms of overall market cap, the Bitcoin blockchain is now valued at $46billion, or about 70%of the current equity market cap of Paypal (NASDAQ: PYPL) at $65 billion.

What is even more remarkable than another price record for Bitcoin is thatthe value of the entire blockchain asset ecosystem is now $100 billion, well over that of Paypal, with BTC dominance falling to just 46%.

This figure includes everycryptocurrency and token in circulation and there a lot of those thanks to the recent rush of ICOs (initial coin offerings) drawing in more and more millions from investors in record time. The total market cap is more than double the value it was just a month ago.

Trading volumes supporting the recent move are very high across the board, reaching about $4 billion daily. BTC/USD trading over the past twenty-four hours consisted just $1.8 billion out of the total.

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Bitcoin Price Tops $2800, Entire Market Now Worth $100 Billion - Finance Magnates

With the date of August 1st fast approaching, a lot of Bitcoin community members are wondering if there will be a UASF futures market. Considering this soft fork will determine the future direction of Bitcoin, there is a lot of interest in the solution. It is unclear if the UASF will succeed in the long run or not. A futures market could be quite lucrative for whichever platform introduces it first.

That is the main question a lot of Bitcoin community members are wondering about right now. It makes a lot of sense to enable such a futures market for the upcoming user-activated soft fork. The date on which this fork will activate is August 1st, 2017. However, it remains to be seen how much support the UASF will get when push comes to shove. Without enough mining support, this implementation will not make an impact whatsoever.

The way these futures markets would look is by making two sides of the order. One side claims the UASF has the support of users and will pass with flying colors. The other side that opposes the fork will argue that it is reckless,and there is not enough support whatsoever. Both sides are certainly present in the Bitcoin community right now, and they are not shying away from making their opinions be heard.

Any platform or exchange opening such a futures market could make a lot of money from the fees alone. There is a lot riding on the UASF activation on August 1st, and the outcome of this activation threshold could be quite different from what most people expect. It is impossible to tell if this soft fork has enough support to automatically become the largest blockchain in the Bitcoin network. It is certainly possible that will be the case in the end, but a lot of people wouldnt mind wagering on the outcome.

It is rather interesting to see there is currently no way to wager on the outcome of the UASF. Even the multiple prediction markets available today are not showing any event related to this historic decision in the world of Bitcoin. That is very surprising considering there are so many divided opinions on this topic right now. One would expect prediction markets to capitalize on this opportunity, yet no one is taking the time to do so.

It is equally possible a lot of people are so bummed out by the scaling debate, they no longer care to voice their opinion either. This could explain why exchanges and trading platforms are not necessarily leaning toward creating a Bitcoin UASF futures market right now. After all, if there is no real demand for such a service, there is no point in wasting time and other resources to make it a reality either.

At the same time, some exchanges like Bitfinex took the time to list Bitcoin Unlimited tokens on their exchange in the case of a chain split a few months ago. Creating a futures market for the UASF is harmless in comparison, since it does not affect overall trading by any means. Only time will tell if we will see such an offering, albeit it seems rather unlikely at this point.

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A Bitcoin UASF Futures Market Could Yield Interesting Results - The Merkle

Step aside, bitcoin. Theres another digital token in town thats winning over the hearts and wallets of cryptocurrency enthusiasts across the globe.

The value of ether, the digital currency linked to the ethereum blockchain, could surpass that of bitcoin by the end of 2018, according to Olaf Carlson-Wee, chief executive officer of cryptocurrency hedge fund Polychain Capital.

"What weve seen in ethereum is a much richer, organic developer ecosystem develop very, very quickly, which is what has driven ethereums price growth, which has actually been much more aggressive than bitcoin," said Carlson-Wee,in an interview on Bloomberg Television Tuesday. The San Francisco Bay Area-based fund has received investments from venture-capital firms including Andreessen Horowitz and Union Square Ventures.

The name ethereum might ring a bell because hackers stole millions of dollars worth of ether last year. Still, its piquing the interest of industries from finance to health care because itsblockchaindoes far more than let bitcoin users send value from one person to another. Its advocates think it could be a universally accessible machine for running businesses, as the technology allows people to do more complex actions in a shared and decentralized manner.

QuickTake Bitcoin and the Blockchain

Carlson-Wee wasnt the first to forecast a bright future for ethereum. Fred Wilson, co-founder and managing partner at Union Square Ventures, laid out an even more ambitious timeline for the cryptocurrency in an interview earlier this month.

"The market cap of ethereum will bypass the market cap of bitcoin by the end of the year," said Wilson, who is also chairman of the board at Etsy Inc.

After skyrocketing more than 300 percent in the last year, bitcoin now costs about $2,300 a coin, which is still around 10 times the price of ethereum. But the second-most popular cryptocurrency is gaining market share fast.

Read more on how digital coins are allowing startups to ditch venture capitalist funding

Bitcoin currently dominates a little less than half of the digital currency market, down from almost 90 percent three months ago, according toCoinmarketcap.com data. Meanwhile, ethereum has quadrupled its share, which now represents more than a quarter of the pie. Other virtual coins have also picked up steam. Carlson-Wee is a fan of auger, golem, zcash and monero.

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Bitcoins growth has started to catch up to its fundamentals, which is likely what has been driving its astronomical gain as of late, he said. Others have attributed the surge to speculation, aswell as increased interest in Asia and adoption by established companies. Impressive performance aside, more than $150 has been knocked off bitcoins price since late last week amid concerns about transaction speed, safety and a possible price bubble.

"Were absolutely still in the infrastructure building phase," Carlson-Wee said. "But I do think within one to two years, well start to see the first viral applications that are user facing."

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Bitcoin Is at Risk of No Longer Being the Biggest Digital ...

MUMBAI: The quest for multi-baggers often leads investors to seemingly obscure stocks that would be the blockbusters of the future. In the past two years, however, money managers may have done better if they had chosen the least likely growth asset the currency.

The once non-descript bitcoin, a crypto currency, has returned more than 10 times since 2015, with the price of the digital instrument hitting a record Rs 225,000 a unit in the domestic spot market last week. Trading in bitcoins is gaining traction, especially among those aged 18-35 years and seeking to harness volatility for extra-ordinary returns.

The increasing awareness of bitcoins worldwide, particularly about its revolutionary technology, has triggered a rally in the bitcoin market, said Sandeep Goenka, cofounder and chief operating officer at Zebpay, an app-based bitcoin exchange. Japan has now added itself to the list of countries that have regulations for bitcoins. Due to these positive factors, bitcoin prices have been showing tremendous strength.

With an expert committee in India now seeking to regulate domestic trading of bitcoins, prices are expected to leapfrog in the next one year. Since April, Japan's legalization of the digital currency has contributed to the rally in bitcoins. After Tokyos move, many vendors have started accepting the virtual currency: Peach Aviation, for instance, is going be the first Japanese airline to accept bitcoins as payment for plane tickets.

Sahil Shah, a final-year BBA student of Nirma University, Ahmedabad, has sold four bitcoins at roughly Rs 2.20 lakh apiece versus Rs 70,000, the average price at which he acquired those.

"This rally was almost a bubble, but it gave a solid profit-booking opportunity for investors who bought bitcoins two - three years ago. I will buy back once prices correct a bit more," said Shah.

It is not necessary to buy one bitcoin. One can even buy a fraction of that. At Zabpay, one can invest with a minimum of Rs 1,000. It is now registering trading volumes of Rs 50 crore per day, which was way below at about Rs 15-20 crore even a year ago.

According to Goenka, Zabpay now holds about 70 per cent market share. Coinsecure and Coinmama are some of the other platforms used to trade in the currency.

Like any other investment, bitcoins are not risk-free. Sharp price swings are routine. After touching the record high of Rs 225,000 a unit, the price plunged to about 160,000 a unit within an hour or two.

"I've held on to my bitcoin portfolio as I am a long-term investor. I expect bitcoin prices to strengthen over a longer time-frame. If more countries legalise crypto currencies, bitcoin prices may appreciate much more than the current (price) levels," said Madhur Todi, who owns seven bitcoins now.

"Betting on bitcoins can be very risky: It's a very volatile asset class. At most, investors can take 1 - 2 per cent of their overall portfolio exposure to bitcoins," said Todi, who runs Mera Money Advisors, an Ahmedabad-based wealth advisory firm.

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All that glitters is bitcoin now - Economic Times