Betting on profit potential of 'digital gold'

Mining refers to the process of creating bitcoin. It can be mined using computer software and a mathematical formula designed by founder Satoshi Nakamoto.
Mining refers to the process of creating bitcoin. It can be mined using computer software and a mathematical formula designed by founder Satoshi Nakamoto.PHOTO: REUTERS

Mr Nicholas Tan, 39, a distributor in the network marketing industry, first dabbled in bitcoin in April, when the prices were still US$2,000. Since then, he has made a $50,000 profit.

"I was trying to find out why bitcoin or 'digital gold' was appreciating," he said. "There are several ways to buy bitcoin. You can go to a cryptocurrency trading platform or through mining."

Mining refers to the process of creating bitcoin. It can be mined using computer software and a mathematical formula designed by founder Satoshi Nakamoto.

"I got to know someone who is a bitcoin miner and began investing through a mining platform called bitclub network, which is a pool of miners investing in mining equipment to mine blockchain and create bitcoins."

"At this point, I would prefer to hold bitcoin because I'm hoping it will go to US$70,000 in three years' time," he said.

Mr Tan said he is not too worried about whether the bitcoin rally could run out at any time. "I don't think bitcoin is a bubble. It is an unregulated asset, which means anyone can own this without going through central banks. It will gain legitimacy as more merchants and companies adapt to bitcoin and more countries accept it.

Grace Leong

 

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A version of this article appeared in the print edition of The Straits Times on December 13, 2017, with the headline 'Betting on profit potential of 'digital gold''. Print Edition | Subscribe