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What Are Virgin Bitcoins?
Cryptocurrency and Bitcoin, in particular, have started to gain real traction worldwide with adoption and recognition increasing every day. Its growth is starting to make governments and traditional financial institutions feel uneasy.
One of the primary narratives used to deter users from using cryptocurrency is the fact that it can be used to fund illegal activities. Since Bitcoin is built on a blockchain it has its entire transfer history of which some transactions could have been illegal. With regulation and rhetoric, these centralised bodies are trying to curb the influence of the blockchain.
These tainted transfers are what's getting certain investors anxious and they're looking for Bitcoin that has a clean slate.
These are now known as Virgin Bitcoin
What exactly is a Virgin Bitcoin?
Virgin Bitcoin are newly minted Bitcoin earned by miners for completing new blocks and adding them to the chain. These new BItcoin have no transaction history and are have never been used prior to its creation.
Virgin bitcoin is an amount of brand new Bitcoin created by a computer/mining rig that was mining by providing hashing power to complete a new block and add it to the Bitcoin Blockchain. Mining is a computer process of recording and verifying information on the digital record known as the blockchain. When the record is secured the miner is rewarded with newly created Bitcoin with no transaction history.
In Bitcoin and as well as other proof of work cryptocurrencies, mining requires computers to compete with each other to solve a complicated math problem. A reward is given to the computer that solved the math problem first, and this is known as Virgin Bitcoin.
Fungilbity under review
An essential part of any currency is its fungibility that one unit currency is no different from another unit of currency. Fungibility ensures that all traders get the same value exchange as agreed on by the network and everyone else who makes use of the money.
Having Bitcoin seen as tainted and untainted and people playing different prices for it disrupts its fungibility. You don't get a dollar and untainted dollar.
Even if they have been used in scams or criminal activity, the dollars all the same. No one is paying premiums for newly printed dollars; they the same as any other in circulation.
To save Bitcoin's fungibility, the network needs to see better on-chain privacy measures.
Obfuscating transfer history will make sure the notion of virgin bitcoin doesn't exist, and all bitcoin are freely interchangeable. Bitcoin developers are aware of this issue and are already working on solutions that would increase the anonymity of bitcoin users.
Why the need for Virgin Bitcoin?
The sudden interest in Virgin Bitcoin comes off the back of the latest G-20 Summit. As a clampdown on money laundering using cryptocurrency goes into effect or is rather being discussed, investors aren't sitting around to lose money and are trying to protect their interests by opting for Virgin Bitcoin.
“When these standards go into effect, interexchange transactions will require transparency regarding senders and receivers of cryptocurrency. This opens doors to a wide berth of scrutiny as regulators probe different ledgers to determine what wallets participated in illicit crypto exchanges, hacks, etc. Bitcoin remains of interest to institutional investors, but their threshold for risk is much lower. With uncertainty as to how the crypto world will conform to the FATF standards, many traditional investors feel it best to air on the side of caution.” said Flex Yang, CEO of Babel Finance, to Cointelegraph
There is now a debate on whether Bitcoin used for Illitue activity. If a coin has a proven record of illicit activity, should it be seized by authorities? Even after they have been moved on and changed wallets several times.
Holding Bitcoin without any transactional history is seen as safe. Since there is virtually no risk of the coins being seized or frozen due to their involvement in questionable past dealings.
The demand is spiking due to reputable bitcoin holders such as institutional investors, are interested in holding “clean” bitcoins to be on the safe side.
What is the cost of Virgin Bitcoin?
Virgin BTC buyers are typically willing to pay up to 20% of the current trading price to get hold of one. However, sellers of Virgin Bitcoin currently demand lay around the 10% mark, whereas, established players known to markup virgin coins by over 30%
How to get hold of Virgin Bitcoin
Virgin bitcoins can be bought directly from cryptocurrency miners who receive these coins as a reward for mining the Bitcoin blockchain. Therefore, these tokens do not have transaction history.
The Bitcoin protocol is pseudonymous, and it is possible to identify a bitcoin owner based on transaction history so you can see if the transaction comes from a miner wallet. Virgin Bitcoins are freshly minted so when they are purchased and sent to their new owner, that would be the first transaction on its tx history.
Watch out for Virgin Bitcoin scams
Since Virgin BTC are primarily peer to peer transfers, we are seeing users trying to take advantage of novice investors trying to sell them BTC and claiming that it is Virgin.
If you're interested in purchasing Virgin BTC, check the wallet address holding the specific BTC and the TX sent to that wallet to ensure they are Virgins. You could also find offers for Virgin BTC listed on forums or a DEX.
Tell us your cryptocurrency story
Have you been earning or buying cryptocurrency? How do you handle your cryptocurrency earnings? Do you buy or own any virgin Bitcoin? Let us know in the comments below.
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If you require a more detailed guide on how to create your profile or your listing, then we highly recommend you check out the following articles.
If you enjoyed this post and have a little extra time to dive deeper down the rabbit hole, why not check out the following posts on money tips.
- Common Finance Mistakes South African Small Businesses Make
- Why Blockchain and Cryptocurrency Is The Future Of Money
- 24 Ways To Earn Cryptocurrency
- How To Pay Tax On Cryptocurrency In South Africa
- How To Buy Bitcoin In South Africa