Business and Finance
Bitcoin? It’s not just online! Britain’s first physical shop where virtual currency can be bought opens in London
An entrepreneur has opened the first shop in Europe where Bitcoins can be bought over the counter.
Normally it can take weeks to set-up an account and purchase the digital currency over the internet – but Akin Fernandez simply prints off a voucher so they can be accessed immediately.
The user then enters a 16-digit code and the Bitcoins are transferred to the designated virtual wallet within 70 seconds.
Entrepreneur: Akin Fernandez has opened the first Bitcoin shop in Europe where people can buy the virtual currency over the counter in Shoreditch, London
Mr Fernandez, 51, has opened his Azteco shop in Shoreditch, central London, and hopes to set up similar outlets around the world. The entrepreneur likened his vouchers to Pay As You Go top ups for mobile phones.
He said that Bitcoins will one day enable 2.2billion people in the developing world who do not have bank accounts to pay for goods and services over the internet for the first time.
Mr Fernandez, who is a former publisher, charges around one to two per cent commission on each transaction.
As Bitcoin is a virtual currency, its value has fluctuated wildly over the last year and soared as high as $1250 last November but currently stands at $630.
Virtual currency: The value of Bitcoins has soared since they were created in 2009 and hit a high of $1250 last year. However, it has since fallen to around half that amount. These coins only symbolise Bitcoins, which is a virtual currency
Currency: Mr Fernandez (left) said that Bitcoins can be used to send money cheaply. However, their value has fluctuated wildly
Bitcoin is a distributed peer-to-peer digital currency that functions without any central authority, such as the Bank of England.
The currency was invented by Satoshi Nakamoto in 2009 and is traded within a global network of computers.
Bitcoins can be bought with near anonymity, which supporters say lowers fraud risk and increases privacy.
But critics say that also makes Bitcoins a magnet for drug transactions, money-laundering and other illegal activities.
And it is hitting ‘real life’, with a cash machine in Vancouver, Canada, and a sushi restaurant in San Francisco dispensing and accepting the currency.
It’s value is not determined by any government but instead by a peer-to-peer network of mainly anonymous users. So, like any undefinable commodity, it can plummet suddenly. It hit a high of $1250 to the Bitcoin last November – but is now worth around half that amount.
People can create their own Bitcoins by ‘mining’ for them. The process involves using computers to solve algorithms so complex that the amount of power they take up limits how much currency can flood the market.