Bitcoin Rockets, Courtesy of China

Bitcoin Infographic for the Chinese

Bitcoin took a hit when the notorious “Silk Road” underground black market closed recently. The coin dived to a value of 109 USD from over 140 USD per bitcoin.

Some said it’s the demise of bitcoin as it was always linked to underground shady activities – being relatively anonymous and offering some level of security, it was the perfect currency for drug dealers, gun merchants and other slithering criminals.

But Bitcoin proved all the naysayers wrong. It started climbing back, and since the silk road seizure on the 8th (13 days ago), it started climbing up steadily, and then broke through its previous value and continued climbing. Currently at 186 USD per Bitcoin over at bitstamp.

The reason for the recent spike was a massive wave of purchases from china. It may be due to Baidu (the Chinese equivalent of Google) beginning to accept Bitcoin, but some think it may be the dreaded 51 percent attack – in the making. A scenario where some interested party (government or bank or a corporation) achieves control of a controlling share of the total network hashing power of Bitcoin – hence the 51 percent. The ability to be able to generate Bitcoin at this capacity is immense – requiring great resources and funds. Allowing to build a separate branch of Bitcoin, achieving the power to cancel transactions by revoking the Bitcoin transfer. In essence it is a corruption of the Bitcoin network.

The interesting question that arises is – who’s behind this sudden Chinese interest? Is it the “Comment Crew”/”Shanghai Group”/”Unit 61398” ultra secret hacker unit situated in Beijing and hence the Chinese government – interested in getting ahead of the wave of this budding new global currency?

Or maybe it’s just a mass of new money investors discovering Bitcoin or being able to invest in it more easily due to the new exposure?

Either way, it makes bitcoin stronger, and that’s a good thing for the coin. The higher the value goes, the stronger it gets and the more attractive to “regular” investors.

What do you think?


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