While many industry experts swore the Bitcoin was going to give traditional currency a run for its money, it isn't really happening. While techies all over the world preach its benefits, average Joes just don't seem to understand how the currency works.
Those who grasp that concept even just a little bit find it too risky and stick with their physical paper and coins.
A startup has come along to show these non-believers what the Bitcoin is all about. Circle is its name, and it offers digital currency financial services in the hopes people feel a bit more comfortable using it. The best part: it will be free.
A Bitcoin Bank
There are many Bitcoin trading sites that exist, and they're the main reason the value of the Bitcoin rises and falls so drastically. Cnet reports that in 2011, it was trading at $2 per share, a far cry from last fall's value of $1,000 per share! They don't want to get into the speculation game.
Instead, they offer consumers a place to convert their “real” cash into digital currency to be used all over the world. To do this, one would simply deposit their actual currency into their Circle account. It is then converted to Bitcoin and stored within your account, all with no associated fees. Once it is digital, it can be used anywhere in the world digital currency is accepted. If you want to withdraw your money again, no problem – the Bitcoins are converted right back to real money and transferred to the bank of your choice.
But everyone is wondering just how secure it is. Not to worry – Circle said that consumer confidence is of the utmost importance. It has many processes in place in order to protect account holders from fraud or theft of their digital currency. The company relied on a cybersecurity company in order to test the network architecture, along with black and white hat hackers to see how strong the system really is.
They are relying on “military-grade” encryption keys to keep everything as secure as possible, and according to the company's CEO Jeremy Allaire, they keep funds in “cold storage” vaults that exist offline, which cannot be accessed by cybercriminals. Their vault facilities are highly secure, and located throughout the world, armed with multiple layers of access control, monitoring, and even armed guard.
But even fraud protection isn't enough sometimes. Things happen, and consumers are still looking for more protection. That's why Circle is a regulated money transmitter here in the US, and they assure consumers that all deposits are fully insured. If a security breach were to happen, consumers can rest easy knowing they're protected in the event of theft.
And theft can certainly happen – hackers were able to pilfer $500 million worth of Bitcoins after Tokyo-based Mt. Gox, a Bitcoin exchange firm, was compromised.
This news comes at a time when the currency is gaining popularity. Certain casinos have agreed to accept digital currency, while cryptocurrency ATMs are starting to appear. And it doesn't stop there – even the US Federal Election Commission has agreed to allow political action committees to accept Bitcoin donations. While it is becoming more widely accepted and is being used a bit more, it has a long way to go before it is truly competing against actual currency. It remains to be seen whether or not Circle will work out.
Have you wanted to use Bitcoins? Will you give Circle a try?