By Toneo Tonderai Rutsito
Few months back, TechnoMag had a featured article Why Bitcoin is worth studying which we closely followed up with how the bit coin money has been under siege from hacking attempts dampening the high spirits of making it a reliable source of online currency, mostly for people like Zimbabweans who really need a “free trading currency”
Just to quickly get everyone else aboard, in the simplest explanation, Bitcoin is a form of “virtual “ currency that can be used online to actually pay for goods and it has a known trading value against most local currency internationally and recently ,even our neighbour South Africans has successfully implemented a BitX, the South African Bitcoin Exchange.
Bitcoin is a digital currency which is not regulated or controlled by any government and exists purely in the cloud.
According to wired.com, this was a brainchild of (someone or a group) called Satoshi Nakamoto, probably a portmanteau of giant technology companies: SAmsung, TOSHIba, NAKAmichi, and MOTOrola.
The currency is not susceptible to any government weak policy directing aaffecting the value against the actual back up of valuable goods like gold, however Bitcoins are neither backed by gold they remain a virtual currency, stored in public networks where the movement is openly traceable.
The other advantage is that the system is quite secure, according to a book the” rise and fall of bitcoin system”, by Benjamin Wallace:
“One of the core challenges of designing a digital currency involves something called the double-spending problem.
If a digital dollar is just information, free from the corporeal strictures of paper and metal, what’s to prevent people from copying and pasting it as easily as a chunk of text, “spending” it as many times as they want? The conventional answer involved using a central clearinghouse to keep a real-time ledger of all transactions—ensuring that, if someone spends his last digital dollar, he can’t then spend it again. The ledger prevents fraud, but it also requires a trusted third party to administer it.”
The ledger is then publicly distributed as a block chain, independent of an government regulatory authority, but run by any powerful server computers, a special piece of software would be called miners and would form a network to maintain the block chain collectively.
This means no one really owns the system, its an open source system , the client is maintained by a community of developers in a decentralised network of thousands of computers
Bitcoin Kenya states that it verifies its transaction using robust state of the art encryption that is used in military and government institutions.
Although all efforts are being put by the community to enhance security, Bitcoins do not have an actual backing of gold and software backed and generated, making it susceptible to reverse engineering and other attacks, although difficult but still may be possible.
South Africans Nicholas Pilkington and Timothy Stranex said when they realised Bitcoin was more than just another “get-rich-quick scheme” they began looking at it more closely and realised one of the problems they could solve was getting consumers’ hands on Bitcoins.
South African Bank, FNB is already charging ZAR7 (US$0.78) for a transfer, while the Bitcoin transaction fee is just ZAR0.7.
Paypal, WordPress, Google and most web hosting services are already using the currency.
On February the 14th Reddit announced that Starting today we’ll be accepting Bitcoin and credit cards for purchasing reddit gold, in addition to the existing options of PayPal and Google Wallet.
The tech hub of Africa, Nairobi-Kenya has gone a step further, you can now freely buy or sell Bitcoins at bank trading rates for any currency from the Pounds, US$, Egyptian pound, Euro, Rands, DubaiBitcoins, or the local Shilling.
World wide, Bank transfers and rates already applicable and most people globaly are already trading in Bitcoins.
You can download the server and client software online to get hooked and start trading from the open source community via sourceforge.
The Bitcoin for android app and apple app are already online for free download .
What remains my top question is will Zimbabweans find this technology relevant to them as a new opportunity presented, an alternative to beating the not so favourable payment systems available in the market.
One great imagination from a Bitcoin ethusiats states that a design similar to the Bitcoin app, which allows one person to transfer Bitcoins to another by using a phone to snap a photo of a 2-D bar code or QR code on the screen of another phone. “People could exchange money when they meet on the street.
Maybe one day we shall wake up to see the foreign currency exchange activity heightening at road ports, this time people will not be “burning foreign currency” , but the Bitcoins.
Due to soared political relations between Zimbabwe and most Western and European countries, free online trade and payments systems have had reservations or stringent measures making it virtually impossible for most Zimbabweans to trade online.