Bitcoin gains momentum in market, reaches USD700 as US Senate discusses regulation

November 19
2:07 AM 2013

As the US government discusses how to regulate Bitcoin, the virtual currency reached another milestone today. Bitcoin's value just reached USD700, according to trading data on Mt. Gox exchange. Bitcoin reached USD600 yesterday, and in April, USD266 was already a record high. According the UK's The Guardian, Bitcoin's value was at USD20.

An animated map on provided a descriptive view on the rise in investor reception on Bitcoin. Pooling information from popular Bitcoin exchanges Mt Gox, Mercado Bitcoin BR, BTC-E, BTCChina, Bitstamp and Bit2c, the map illustrated the real-time currency flow of countries around the world into Bitcoin.

Based on the screen capture of the map posted for a Business Insider article, majority of the currency flow came in from China and the US. Regular investors of the Bitcoin were found in Brazil, Japan, Europe and Australia.

In a letter addressed to the homeland security and the government affairs committee of the US government prior to the US Senate hearing, US Federal Reserve chairman Ben Bernanke highlighted the issue of enforcing law on virtual currencies.

"Although the Federal Reserve generally monitors developments in virtual currencies and other payments system innovations, it does not necessarily have authority to directly supervise or regulate these innovations or the entities that provide them to the market," Bernanke said.

The Senate committee had held a hearing to discuss about the potential risks, threats and benefits of virtual currencies, particularly Bitcoin.

The issue about Bitcoin regulation was a hot topic in the US. The issue was earlier on magnified with the discovery of illicit activity on online marketplace Silk Road, wherein most of the activity found were on trading of drugs and guns-for-hire.

However, lobby group Bitcoin Foundation general counsel Patrick Murck said, "(the currency does not) pose a unique or unsolvable challenge to law enforcement or existing regulatory structures. Bitcoin can facilitate private and anonymous transactions, which are resistant to oversight and control. This by no means implies that using Bitcoin can or should provide anyone immunity from the law.

"Though it has sometimes been portrayed as such in careless media stories, Bitcoin is not a magic cloaking device that allows criminal actors free reign. It does offer enhanced privacy protections, however, which is the just desert of hundreds of millions of law-abiding Americans and billions of law-abiding people worldwide," Murck concluded.

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