Blog Feed Post

Cloud Currency: Bitcoin & the Rush to Fill Your Cyber-Wallet

Bitcoin global currency

Hm, where to get a drink? For those with Bitcoin, the Pembury Tavern could be the obvious choice. Why? Well, Bitcoin is on the tip of many Internet and finance-savvy tongues – as well as many not so savvy ones – so a bar is sure to get noticed by the press when it says it’ll take the alternative online currency (as indicated by its appearance in The Telegraph in an article about the topic).

Bitcoin has revolutionized the worldwide reception of online currency. It’s a major victory for a concept previously unknown or regarded as highly questionable.

Now the question is this: Is turning your money into Bitcoin really a good idea? The question must be asked as to the real value of an invented cryptocurrency (a cyber-currency built and identified using cryptographic algorithms).

Holes in Bitcoin?

Bitcoin is quickly becoming a household term. It has been around since 2009, but it certainly seems to be trending skyward. People shouldn’t be completely sold on an unproven virtual dollar. The market is incredibly volatile. It seems to invite fraud and may not always have the code sophistication or identity parameters to fight it.

Both those points were proven a few days ago, when  the Japanese Bitcoin exchange Mt Gox announced it had found a bug that makes fraud possible. The loophole in the code allowed users to perform transaction malleability, making it seem like a transaction to a Bitcoin wallet did not occur when it actually did.

Unlike the US dollar, the Japanese yen or the British pound, Bitcoin does not have a track record and does not exist except as a virtual computer file. To be fair, any currency, commodity, stock, entire industry or economy is susceptible to manipulation or bad press. Take the US dollar’s volatility during the debt ceiling battle in October or the global real estate and finance markets. Everything is susceptible to failure.

The Rise of Bitcoin

Bitcoin gains steam

Regardless of setbacks, Bitcoin is riding high – and its prominence seems to be steadily growing over time. Digital currency like Bitcoin is now accepted by several restaurants and other brick-and-mortar locations. Reddit accepts it. So does WordPress.

Bitcoin is popular because it functions as cash – based on its current value vs. the dollar – but the buyer isn’t identifiable. There are no fees. Funds simply switch from one account to another within the Bitcoin peer-to-peer (P2P) network (i.e., one in which all devices bear an equivalent amount of responsibility for processing data). Bitcoin cannot be stolen or go missing and there’s less chance of identity theft than there is when alternatives such as credit and debit cards are for purchasing.

History and the Parameters of Bitcoin

Bitcoin was unveiled by an unidentified hacker – possibly multiple hackers – five years ago, under the assumed name Satoshi Nakamoto. The online user posted a conceptual framework on the new currency, including a description and general reasoning for its existence. Open source software was made available, but the Nakamoto figure has never resurfaced.

Like some other open source software, no one person or group is in control of Bitcoin. The virtual currency in the hands of those who own it, exchange it and run its software. It remains to be seen whether handling a currency that has no executive controllers is wise.

The model is attractive to those in the open source and hacker communities. It is also of interest to libertarians and others who distrust governmental regulations and prefer a system designed by and for the people. Bitcoin is not just a niche idea anymore, though. It has become more universally attractive as investors and everyday people seek safe havens for their earnings in an increasingly unsure global financial environment.

Bitcoin Alternatives

Business Insider took note of Bitcoin in November 2013, when its value (whether inflated or not) had risen to over $1000 per coin. The magazine explored alternatives to bitcoin, which are manifold. Here are three of them:


Litecoin exploded onto the scene in 2013. Also rooted in open source, cryptographic formulas and exchanged in a peer-to-peer manner, Litecoin gets its name for obvious reasons: it does not require the same computing power for transactions as does Bitcoin. Rather, standard PCs can be used for Litecoin transactions.


Another cryptocurrency founded in the open source community, Namecoin functions within its own domain name system (DNS). Because Namecoin does not exist within the standard DNS controlled by the Internet Corporation for Assigned Names and Numbers (ICANN), it is its own animal. Namecoin is free of the constraints of websites operated within the ICANN system. However, Namecoin is not a darknet because its users are not anonymous, at least not with regards to their historical behavior within the network.


Peercoin is P2P currency built to address some of the problems critics have cited with Bitcoin: lack of security, lack of protections against fraud and inefficiency in its algorithmic framework.

Is Bitcoin a Scam?

In 2011, Tim Fernholz argued in Good that Bitcoin is a scam. Why? Here are his four basic arguments:

  1. It’s not secure. Shortly prior to Fernholz’s article, numerous Bitcoin accounts were targeted by hackers. One user had almost $400,000 worth of bitcoins stolen. With Mt Gox’s recent revelation, security still seems to be a major flaw.

  2. It’s not a better way to pay. Now, here’s one thing that seems to be changing rapidly. Fernholz argues that Bitcoin is not preferable to credit cards: it doesn’t represent anonymity because even if you’re using strong privacy mechanisms, “Internet forensics could likely track you down” if you purchase something illegal.

  3. Trust isn’t great. Currencies work when people recognize them as legitimate and use them frequently. Again, this is changing rapidly, but Bitcoin will work only if it is widely accepted and trusted.

  4. Processing power wins. Bitcoin is based fundamentally on computing power: the growth of the network determines its fairness and balance. At the time of the Good piece one collective called Deepbit.net processed a third of all Bitcoin transactions. Popularity of specific mining collectives remains an issue in 2014.

At Solar VPS, we specialize in Cloud VPS and certainly want to see developers and the online community become stronger and engage in new forms of interaction. Bitcoin and other open source currencies are a fascinating idea and may end up altering our financial world for the better, but the cryptographic currency market should be viewed with a heavy dose of skepticism.

By Kent Roberts

Read the original blog entry...

More Stories By Solar VPS

Solar VPS lives the Parallels "Optimized Computing" vision. It has created a virtual infrastructure from client offerings, data facilities and management offices. Solar VPS works very closely with Parallels to provide the highest possible service and support to customers.

Latest Stories
DXWorldEXPO LLC announced today that ICOHOLDER named "Media Sponsor" of Miami Blockchain Event by FinTechEXPO. ICOHOLDER give you detailed information and help the community to invest in the trusty projects. Miami Blockchain Event by FinTechEXPO has opened its Call for Papers. The two-day event will present 20 top Blockchain experts. All speaking inquiries which covers the following information can be submitted by email to [email protected] Miami Blockchain Event by FinTechEXPO also offers s...
DXWorldEXPO | CloudEXPO are the world's most influential, independent events where Cloud Computing was coined and where technology buyers and vendors meet to experience and discuss the big picture of Digital Transformation and all of the strategies, tactics, and tools they need to realize their goals. Sponsors of DXWorldEXPO | CloudEXPO benefit from unmatched branding, profile building and lead generation opportunities.
@DevOpsSummit New York 2018, colocated with CloudEXPO | DXWorldEXPO New York 2018 will be held November 11-13, 2018, in New York City. From showcase success stories from early adopters and web-scale businesses, DevOps is expanding to organizations of all sizes, including the world's largest enterprises - and delivering real results.
Dion Hinchcliffe is an internationally recognized digital expert, bestselling book author, frequent keynote speaker, analyst, futurist, and transformation expert based in Washington, DC. He is currently Chief Strategy Officer at the industry-leading digital strategy and online community solutions firm, 7Summits.
Widespread fragmentation is stalling the growth of the IIoT and making it difficult for partners to work together. The number of software platforms, apps, hardware and connectivity standards is creating paralysis among businesses that are afraid of being locked into a solution. EdgeX Foundry is unifying the community around a common IoT edge framework and an ecosystem of interoperable components.
"We started a Master of Science in business analytics - that's the hot topic. We serve the business community around San Francisco so we educate the working professionals and this is where they all want to be," explained Judy Lee, Associate Professor and Department Chair at Golden Gate University, in this SYS-CON.tv interview at 21st Cloud Expo, held Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA.
DXWorldEXPO LLC announced today that Dez Blanchfield joined the faculty of CloudEXPO's "10-Year Anniversary Event" which will take place on November 11-13, 2018 in New York City. Dez is a strategic leader in business and digital transformation with 25 years of experience in the IT and telecommunications industries developing strategies and implementing business initiatives. He has a breadth of expertise spanning technologies such as cloud computing, big data and analytics, cognitive computing, m...
Digital Transformation and Disruption, Amazon Style - What You Can Learn. Chris Kocher is a co-founder of Grey Heron, a management and strategic marketing consulting firm. He has 25+ years in both strategic and hands-on operating experience helping executives and investors build revenues and shareholder value. He has consulted with over 130 companies on innovating with new business models, product strategies and monetization. Chris has held management positions at HP and Symantec in addition to ...
Cloud-enabled transformation has evolved from cost saving measure to business innovation strategy -- one that combines the cloud with cognitive capabilities to drive market disruption. Learn how you can achieve the insight and agility you need to gain a competitive advantage. Industry-acclaimed CTO and cloud expert, Shankar Kalyana presents. Only the most exceptional IBMers are appointed with the rare distinction of IBM Fellow, the highest technical honor in the company. Shankar has also receive...
There is a huge demand for responsive, real-time mobile and web experiences, but current architectural patterns do not easily accommodate applications that respond to events in real time. Common solutions using message queues or HTTP long-polling quickly lead to resiliency, scalability and development velocity challenges. In his session at 21st Cloud Expo, Ryland Degnan, a Senior Software Engineer on the Netflix Edge Platform team, will discuss how by leveraging a reactive stream-based protocol,...
DXWorldEXPO LLC announced today that Kevin Jackson joined the faculty of CloudEXPO's "10-Year Anniversary Event" which will take place on November 11-13, 2018 in New York City. Kevin L. Jackson is a globally recognized cloud computing expert and Founder/Author of the award winning "Cloud Musings" blog. Mr. Jackson has also been recognized as a "Top 100 Cybersecurity Influencer and Brand" by Onalytica (2015), a Huffington Post "Top 100 Cloud Computing Experts on Twitter" (2013) and a "Top 50 C...
Enterprises have taken advantage of IoT to achieve important revenue and cost advantages. What is less apparent is how incumbent enterprises operating at scale have, following success with IoT, built analytic, operations management and software development capabilities - ranging from autonomous vehicles to manageable robotics installations. They have embraced these capabilities as if they were Silicon Valley startups.
Daniel Jones is CTO of EngineerBetter, helping enterprises deliver value faster. Previously he was an IT consultant, indie video games developer, head of web development in the finance sector, and an award-winning martial artist. Continuous Delivery makes it possible to exploit findings of cognitive psychology and neuroscience to increase the productivity and happiness of our teams.
The standardization of container runtimes and images has sparked the creation of an almost overwhelming number of new open source projects that build on and otherwise work with these specifications. Of course, there's Kubernetes, which orchestrates and manages collections of containers. It was one of the first and best-known examples of projects that make containers truly useful for production use. However, more recently, the container ecosystem has truly exploded. A service mesh like Istio addr...
As DevOps methodologies expand their reach across the enterprise, organizations face the daunting challenge of adapting related cloud strategies to ensure optimal alignment, from managing complexity to ensuring proper governance. How can culture, automation, legacy apps and even budget be reexamined to enable this ongoing shift within the modern software factory? In her Day 2 Keynote at @DevOpsSummit at 21st Cloud Expo, Aruna Ravichandran, VP, DevOps Solutions Marketing, CA Technologies, was jo...