Bitcoins - A first look at a new currency
Bitcoin is a new "currency" that has caught the imagination of the world and I thought it may be worthwhile to step in and see what it looks like. But before that what is Bitcoin ? A Google search on the topic will lead to lots of fairly detailed explanations but let me summarize what I have understood so far. It is more like a commodity, like gold or guar seeds, that are being traded at a price dictated by the demand and supply in the market. Since it is a digital artifact, it is being "mined" or "created", by running a computer program -- that consumes time, power and CPU cycles -- and seeing if the result meets certain requirements. Think of it as if you are asked to locate the next prime number. These requirements are defined "collaboratively" by a federation of computer servers located on the internet. So unlike a Central Bank there is no single body that controls the supply Bitcoins. Anyone can join this federation by installin...