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The Rise of Bitcoin and VC

Money evolves to meet the commercial needs of society. The latest in the evolution of money is virtual currency . VC is electronically created by its developer, bought through a digital exchange, and stored in e-wallets, not in bank accounts. Transactions are peer-to- peer (P2P) meaning a purchase/ sale transaction is made directly with no bank involvement or government intermediary (legal tender). Bitcoin (“BTC”) is the best known of all VCs. It has a growing user base and is gaining acceptance with mainstream retailers such as Home Depot, Amazon, Expedia, and many college campuses. However, VCs remain controversial for many reasons. Bitcoin, for example, has a shady past which includes links to illegal drug sales, arms trading, and money laundering. The values of VCs can fluctuate wildly. VC exchanges (where people deposit their VC to exchange for dollars or other currency) have been the target of numerous successful hacks causing extensive losses for VC holders. Nonetheless, Bitcoin is here to stay, so let’s learn a “bit” about it. Here are your resources for this exercise: (You can link to videos through c21student.com) • CNN Money What is Bitcoin? money.cnn.com/infographic/technology/what-isbitcoin • The History of Bitcoin www.historyofbitcoin.org • California Department of Business Oversight, What You Should Know About Virtual Currencies www.dbo.ca.gov/Consumers/Advisories/virtual_Currencies_0414.pdf http://online.wsj.com/articles • What is Bitcoin? commons.wikimedia.org/wiki/File:What_is_Bitcoin?.webm 1. According to CNN , what are the advantages of or reasons for using Bitcoins? _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ _ ______________________________________________________________________________ 2. How do people send Bitcoins to each other? (See CNN ) _ ______________________________________________________________________________ They can be used to buy merchandise anonymously There are no international payments/exchange costs There are no credit card fees They may go up in value directly; peer-to-peer via mobile apps or their computers PRODUCT PREVIEW

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THE 21st CENTURY STUDENT’S GUIDE TO FINANCIAL LITERACY

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