Virgin bitcoins have been grabbing the headlines recently, as premiums reach the 20-30% mark. But what exactly are virgin bitcoins and what makes them more valuable than others? Our handy guide explains all.
Fresh From the Miners
Virgin bitcoins are bitcoins that have no transactional history – in other words they have been freshly mined and not yet sent anywhere. The cash equivalent would be a dollar bill that you have collected straight from the printers.
When it comes to the dollar bill this might be nice because, well, who doesn’t like a nice a crisp note, but it can serve another purpose too.
Protecting Your Assets
Imagine if the police issued a call for cashiers up and down the land to be on the lookout for banknotes between a certain range of serial numbers that were involved in a recent crime. You hand over your ten-dollar bill and before you know it, you’re in a police station being treated like a suspect and interviewed about the origins of the note.
This is perhaps a little extreme, but in the same way that each bill can be identified by its serial number, each bitcoin, or fraction of a bitcoin, can be identified and tracked on the Bitcoin ledger.
And if you happen to receive some Bitcoin that was the known proceeds of crime and the police can identify you, then you can expect a knock at the door, whether you know something about it or not.
The Benefits of Clean Bitcoin
Virgin bitcoins are completely ‘clean’ and cannot possibly have been used for nefarious purposes, which is why some ultra-careful investors are paying a 20-30% percent premium for them – they want to eliminate the risk of their Bitcoin being frozen as part of a criminal investigation, or receiving a visit from the police.
The likelihood of being hauled off to the cells because of some Bitcoin you received is, at the moment, almost the same as that of being collared while buying a stick of gum with your tainted ten dollar bill. However, with new regulations making it mandatory for each exchange to identify their account holders, the chances are rising all the time.
For those who want to completely eliminate the chances of an unwelcome visit, some platforms, like VertexMarket, offer virgin Bitcoin and virgin Ethereum. The rest of us will have to rely on the commonsense approach of the authorities.
Hmmm.
