Tesla ( said last month it will )soon accept bitcoin as payment for its vehicles, and disclosed it had purchased $1.5 billion in the cryptocurrency as part of its cash holdings. Meanwhile, Uber ( and )Mastercard ( also said they plan to )start accepting bitcoin. BNY Mellon and BlackRock are looking into bitcoin. And Jay Z and Twitter CEO Jack Dorsey announced they establishing a bitcoin development fund.
There is speculation that as more financial institutions invest in bitcoin, more companies will join. Some investors believe that it could be a good hedge against inflation and a weak dollar. The Federal Reserve cut interest rates in March 2020, severely weakening the US dollar and shooting up the price of bitcoin.
So if you’ve been ignoring bitcoin thinking it might just be a financial fad, now’s the time to start paying attention. Here’s what you need to know.
What is bitcoin?
Bitcoin is a cryptocurrency created in 2009 by an unknown person using the alias Satoshi Nakamoto. Transactions are anonymous and are made with no brokers or intermediaries.
You can’t physically use bitcoin — it’s a digital currency. And it’s decentralized, meaning that it isn’t controlled by a bank or government.