KUWAIT: Have you heard about the bitcoin? It is not money or currency; it is not even a precious metal, and no country in the world recognizes it.
In reality though, bitcoins are being ‘used’ like a ‘digital currency’ worldwide. Of course, Kuwait cannot be far behind, as there are some groups and individuals in Kuwait who are dealing in bitcoins, even thought the cryptocurrency is not recognized by the Kuwaiti government.
According to Abdullah Al-Mezairee, co-founder of Bitfils, bitcoins are gaining traction. Mezairee was speaking at a seminar on bitcoins on Monday at the Sirdab Lab in Dasman Complex in Sharq, which was mostly attended by local start-up businesspeople and some students interested in how the bitcoin works.
Bitcoin is a payment system invented by Satoshi Nakamoto, who published the invention in 2008 and released it as open-source software in 2009. But the bitcoin is not a currency, and there is no central trusted organization that runs it; all transactions are recorded and are public, while personal identities are irrelevant.
“You will only see records of transactions, but nobody knows who owns it,” said Mezairee. Bitcoins nowadays can be used to buy up to about 2.5 million products from 6,000 locations all over the world. Mezairee reiterated that the bitcoin is neither currency nor gold. “We don’t know whether it is a currency or not, but one thing is clear – it is not gold, and what we know is that they are transacted through the Internet. Only 21 million bitcoins will be available and can be obtained by solving mathematical problems,” Mezairee noted. In terms of payment, a bitcoin payment is irreversible, he added.
So who operates it? Miners run nodes, and nodes secure the network by solving different cryptographic problems. The place where they work is called a farm. “The bitcoin protocol rewards the nodes with bitcoins and the amount rewards depend on the computing power a node provides through proof-of-work algorithm,” he said.
Users can transact directly without needing an intermediary they are automatically verified by network nodes and recorded in a public distributed ledger called the ‘block chain’. According to information available on the Internet, the bitcoin is more correctly described as the first decentralized digital currency. It is the largest of its kind in terms of total market value. “We are not encouraging you or anyone to buy bitcoins, but you can try by investing in a small amount and see what is the bitcoin all about,” he mentioned. Bitcoins in Kuwait are available online by connecting to Bitfils.com.
By Ben Garcia