Bitcoin Is Growing; Coinbase & Are Ready To Help

Bitcoin is Growing; Coinbase and are Ready to Help

Defining exactly what Bitcoin is, is more difficult than stating what it isn't. Though it's like a currency, and like a payment system, it's really neither. Bitcoin is starting to be called "the internet of money." Bitcoin can be thought of as a peer-to-peer currency, and it's gaining momentum worldwide. New companies are emerging that are Bitcoin-centric, while older, established companies are dipping their toes into the Bitcoin waters.

Bitcoin has generated considerable, despite (or perhaps because of) not being government-backed legal tender. Businesses are starting to look at Bitcoin as an innovation strategy for payment systems, services, and products. For example, entertainment companies are experimenting with bitcoin as payment for music downloads.

Consumer Risks and Benefits

A report by PricewaterhouseCoopers titled "Digital Disruptor: How Bitcoin is Driving Digital Innovation in Entertainment, Media and Communications" lists the following Bitcoin benefits for consumers:

•Generally no fees for sending bitcoin globally
•Transactions are pseudo-anonymous
•Sometimes Bitcoin rises in value
•Financial institutions don't control it

Risks for consumers include:

•No payment reversals
•Buying and cashing out Bitcoin can be complex
•Adoption among brands is only at the "niche" phase
•Digital wallets are as-yet unfamiliar technology
•Regulators aren't quite sure what their role is with respect to Bitcoin

But there's no denying Bitcoin is a decentralized, global brand, supported by an organic entrepreneurship ecosystem. And consumers are interested.

Bitcoin's Role As Authenticator

Startups are using Bitcoin's underlying code for payment verification as well as non-monetary tasks like authentication. These tools could substantially reduce fees now paid by buyers and sellers in ecommerce, financial services, and cloud computing, just to name three. When someone spends bitcoin, the change in ownership is recorded by a global computer network and posted to a public register.

Start now: Sign up for Mint and track all your finances including Coinbase transactions. Click to get started.

The Underlying Innovation: The Blockchain

The blockchain is a building block of Bitcoin. It's designed to validate transactions and could be adapted for any type of exchange, whether it involves a financial transaction or not. Blockchain technology could be used in a range of industries. Once online trust in blockchain technology is established, it could be used to reinvent numerous industries, like digital stocks and bonds, digital crowdfunding, and digital insurance. The possibilities are just beginning to be imagined.

The Future of the Internet of Money

A startup called BitShares X is expected to debut in the second quarter of 2014 and, using blockchain technology, will offer users the ability to borrow, lend, trade, and save financial securities of all types from fiat currencies to derivatives without the intermediary of a brokerage or bank. Transactions will be verified publicly, handled by individual users' computers, and will be immune to fraud.

Better still, the technology can eliminate fees normally used for the costs associated with accounting, verification, and banking services. The results? Processes like dispute resolution and escrow could be taken care of with blockchain technology, cutting out middlemen (and their fees). Furthermore, financial institutions are evaluating Bitcoin as a vehicle for internal operations.

Bitcoin and the Ordinary Consumer

Coinbase is the leading Bitcoin wallet and platform, allowing everyday consumers and merchants to transact using Bitcoin. With 1.1 million consumer wallets and counting, Coinbase is also used by 28,000+ merchants, and offers US bank integration. It offers bank-level security using AES-256 encryption, and up to 97% of customer funds are stored in bank vaults to prevent theft or loss.

Sensitive data is disconnected entirely from the internet, and drives and paper backups are distributed geographically to safety deposit boxes and vaults. Furthermore, two-factor authentication requires users to enter a code from their mobile phones in addition to usernames and passwords when using Coinbase.

Mint and Coinbase

In January, Coinbase and Mint announced a partnership that allows Mint users to view their bitcoin transactions processed by Coinbase right alongside their other financial accounts. Mint is a free app providing personalized financial tracking and budgeting to 14 million users, allowing them to view and track all their finances in one place. With this partnership, Mint became the first personal finance and money management tool to allow users to view their Bitcoin transactions. Simply add Coinbase in Mint as an account, just as you would a bank account to track Coinbase usage.

If you've taken that step and created a Coinbase wallet, why not link it to Mint right from the beginning? It's the easiest, most convenient way of tracking your personal Bitcoin use, and empowers you to make the most of this new type of transaction.

Start now: Sign up for Mint and track all your finances including Coinbase transactions. Click to get started.