When Bitcoin launched in 2008, a single unit of the mysterious cryptocurrency was worth just a little more than half a cent. Bitcoin’s value remained under a dollar for years afterward, leading many to wonder why anyone would invest in a strange new currency that couldn’t be controlled by any government or company. Besides being seemingly worthless, Bitcoin also operated through a decentralized network of computers whose owner was impossible to verify. This anonymity extended to Bitcoin’s users as well, who could purchase the virtual currency without giving away any personal information.
Bitcoin’s secretive nature eventually drew interest from investors around the world. Like gold or stock prices, its value is determined by open-market bidding on an exchange. This causes Bitcoin’s price to fluctuate greatly, as it did in 2013 when the currency’s value jumped from about $13 at the beginning of the year to more than $800 by December 31. Still, that’s almost nothing compared to the enormous leap in worth that Bitcoin has pulled off this year. After starting 2017 at about $985, Bitcoin’s value has since topped out at more than $4,000.
While this is great news for Bitcoin holders, it can also bring them unwanted attention from thieves and hackers. Smartphones have especially become an easy target since many people keep their Bitcoins in digital wallets that can be accessed on mobile devices. “Everybody I know in the cryptocurrency space has gotten their phone number stolen,” said Bitcoin entrepreneur Joby Weeks. He lost nearly $1 million in Bitcoin last year after a hacker obtained his cellphone number and accessed his accounts. Authorities say thieves closely watch social media for anybody who posts about owning or trading virtual currencies. As more consumers begin to depend on their mobile devices as their wallets, though, hackers could begin targeting anybody whose number they can find. So whether or not you’re lucky enough to own Bitcoin, be careful where you display personal information like your phone number.
Questions:
- Do you think cryptocurrencies like Bitcoin are a safe investment?
- What are some ways that you can keep your personal information safe from hackers?
Sources: Nathaniel Popper, “Identity Thieves Hijack Cellphone Accounts to Go After Virtual Currency,” The New York Times, August 21, 2017; Nathaniel Popper, “What Is Bitcoin? All About the Mysterious Digital Currency,” The New York Times, May 15, 2017; Coindesk.com/price, Accessed August 21, 2017. Photo by Max Pixel.