Islamic Bank of bitcoins is the future of the traditional currency system. It has created a stir in the world of digital currencies, because it is unique and because it is the first of its kind. The system works under the same principles as other currencies – namely, that you can transfer your payment into another currency by making a transaction on the Internet or on a phone call. What makes it different is that it uses a special algorithm to make the transactions secure.
Unlike conventional paper money, Islamic Bank of bitcoins does not have a physical commodity like gold or silver. So, what makes the system work? In order to understand the answer to this question, it is important to look at the nature of the currency. Think of it this way: the whole purpose of the state in the modern age was to create money that would be able to be both useful and interest free.
The state created the money in the form of gold and silver, with high interest rates that were never going to be touched. But the government did not stop there. When paper money was released, it too was soon followed by high interest rates that would never be touched. And since the entire system is based on faith, no one even bothers to check whether the rates are high or low. So, is there anything different with Islamic Bank of bitcoinica?
No, there is not. This is because the system works under the very same principles as other virtual currencies. Just like in the case of the US dollar, the value of bitcoins is determined by how much energy it is worth per unit. However, when you combine the fact that there is a low supply of bitcoins and that the number of users is limited to less than twelve million, the concept of Ponzi scheme becomes a little bit irrelevant.
In fact, in terms of security, the lack of physical good to trade in makes the system vulnerable to hacking. A recent high profile case shows how the WordPress blog post was hacked and the blogger had to fork out a huge amount of money. While other currencies are more secure, this is an example of why you should be careful when dealing with currencies that are not widely known. With the absence of tangible goods, there is also the risk of a huge amount of people doubles depositing cash into your account.
However, the use of cloud mining techniques is more likely to secure the value of the Islamic Bank of Bitcoin. Cloud computing is a technique where large companies use high quality supercomputers to mine large amounts of virtual currencies. In the case of the Islamic Bank of Bitcoin, it is estimated that the network will hold over two hundred petahashes of virtual currency – this is about five thousand billion USD worth of currency. Now imagine how strong the encryption on its own network is – and that is just for starters.
At the moment, the use of cloud mining by big companies is still in the earliest stages. You can expect it to gain more popularity in the future as long as the benefits from it can be properly measured. In addition to being safe from hacking, the use of the Blockchain technology is an excellent way of securing your private key / password. It also allows you to transact with other users who have made transactions with the Islamic Bank of Bitcoin.
The uses of the Islamic Bank of Bitcoin are still in early days. It is a virtual currency that is used by businesses all over the world. However, as long as it remains in private hands and is not allowed to enter the public domain, it will remain very useful as well as secure. This is because no government will be able to change the value of this virtual currency. And as long as you keep your private key, you are absolutely safe from any possible hacking attempts.