Redding
60° F
Overcast
Overcast
Red Bluff
63° F
Overcast
Overcast
Chico
61° F
Overcast
Overcast
Advertisement

BITCOIN: Getting the Facts on the digital currency

By Mark MESTER
Published On: Jan 18 2014 01:39:10 AM CST
Updated On: Jan 18 2014 06:25:30 AM CST
(img1)bitcoin

REDDING, Calif. -

If you're someone who follows financial news you know a big story in 2013 and now is Bitcoin.

Bitcoin is the first decentralized digital currency.

It's sent over the internet.

Anyone with the proper computer skills can create a Bitcoin using an application called a Bitcoin Miner.

More than 12 million are currently in circulation and there's a limit of 21 million, according to bitcoin.org.

Anyone can convert them into cash. Several exchanges exist to transfer dollars to Bitcoins or vise versa.

We checked and not a single North State business accepts the digital currency.

The nearest California business to accept it was in Grass Valley, Nevada County, which is northeast of Sacramento.  

We spoke with the owners of Humble Fabric and Crafts. Branch Ellison and his wife, Roxanne said they've been using and accepting Bitcoin for about two years.

"We have a credit card service and we get charged about 3 to 4 percent every time we accept a credit card, but if we take Bitcoin we don't have any of those fees at all," said Ellison.

We also caught up with a Bitcoin consultant.

Paul Racko of Nevada City is currently helping small businesses and non-profit organizations accept Bitcoin.

Racko said he sees enormous growth potential in 2014. He predicts more e-retailers will be signing on.

Racko also believes immigrants will turn to Bitcoin to transfer money back home because the transaction is cheaper than using a service like Western Union.

Just this week, the Sacramento Kings said it would start accepting in March. Overstock.com and Zynga have also signed on.

Bitcoin also has investment opportunities, but it's very volatile.

At the start of 2013, one Bitcoin was worth about $13 dollars. The currency surged past $1,000 in November. The currency was trading just below $800 when this report was filed.

Bitcoins are stored in a network that's both permanent and anonymous. Because it's anonymous, Bitcoins are used frequently in the drug trade.
Last year a drug website called, "Silk Road" was broken up by Federal Agents in San Francisco. 

Authorities said the website was used by several thousand drug dealers to sell more than $1 billion in illegal drugs.
     
It's still a mystery as to who created Bitcoin.

A Google search will tell you it was introduced as open source software by pseudonymous developer Satoshi Nakamoto. There are no records of that identity before 2009.