What is Bitcoin? - Toledo News Now, News, Weather, Sports, Toledo, OH

What is Bitcoin?

(Source: WTOL) (Source: WTOL)
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TOLEDO, OH (WTOL) -

Bitcoin is one form of cryptocurrency or digital money.

In fact, there are about 1,500 cryptocurrencies.

A Toledo area investor names a few, "Bitcoin, Eutherium, Litecoin, Ripple, Stellar, Miota, Digicoin, Dogecoin."

An anonymous person or group named Satoshi Nakamoto created Bitcoin. In 2010, its highest price for the year was $.39. Today, it is trading for about $8,000, drawing investors like Chris Stutzman.

"You would see growth of 500 percent or 1,000 percent. These numbers are scary and just as fast as they can go up they can go down," Stutzman said.

Cryptocurrency and Bitcoin are not actual coins, gold in color like they are often portrayed. Think of it more like blocks on a chain, or a block chain.

The value is based on supply and demand, which makes it extremely volitile and just as attractive.

People who got in on it early are getting extremely rich.

Take for instance, the story of bankrupt rapper 50 Cent who remembered he had received Bitcoin years ago and recently cashed it in for $8 million.

"There's nothing more painful I think for folks than seeing their friends getting rich, right," Cleves Delp asked.

Delp's company, TDC Companies, manages nearly $6 billion in client investments.

He is not ready to recommend buying cryptocurrency. However, he says, it is something you need to investigate.

"Although it's different, it's not new," Delp said.

Delp compares the shock of cryptocurrency to some of today's most stable investments in their infancy.

"This isn't the first time there's been this notion of this kind of an investment," Delps explained. "As an example, gold and silver not too long ago went through the same kind of rage. Before that, it was oil and gas."

Delp says cryptocurrency is here to stay, much like self driving cars and online shopping.

"The world will continue to change and evolve and if you're not open to that, you're going to get run over and this is just the emerging of something that's new and different," Delp said.

Experts say the government does not like new and different and has been struggling to regulate the asset.

The SEC and Treasury Department have issued a number of bulletins on the topic.

Still, it is not enough to keep investors away.

"It's at the bottom of the mountain," Stutzman said. "It's on it's way up."

Unlike cash, it is not managed by any government or bank. With cryptocurrency, you are your own bank.

"This just gives more power to the individuals where if I want to give you five dollars, why does a bank, why does one large institution or even the government need to be involved in that," Bruce Cartwright, a "Millennial" Delps has tasked with investigating cryptocurrency so TDC can inform clients, asked.

People also like the anonymity because they can trade Bitcoin or make purchases without their names being revealed, protecting against identity theft.

However, that anonymous exchange also allows for criminal activity, like Silk Road, an online marketplace in which drugs were bought and sold using cryptocurrency, landing its operator in prison for life.

"Cash is the number one way to do illegal activity and that's always going to happen," Cartwright pointed out.

While some retailers do accept Bitcoin, you are not able just yet to visit your favorite fast food chain using Bitcoin.

However, experts do believe the block chain digital payment will be main stream in the future.

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