In about 30 days the value of bitcoin alternative darkcoin has surged from 75 cents to $7.
The currency’s main attraction is the higher degree of anonymity compared with bitcoin, meaning it’s very difficult to track persons behind any darkcoin transaction.
According to Sky, digital currencies such as bitcoin have gained popularity, with some becoming synonymous with illicit trade such as purchase of drugs, weapons and other unlawful business activities.
The bitcoin cousin is among cryptocurrencies enjoying the most rapid growth, with the value of total amounts of the currency in circulation nearing $30 million.
The virtual currency adds an additional layer to conceal identities of sellers or buyers involved by jumbling up individual transactions with others. The additional anonymity layer is called darksend, meaning it’s almost impossible to track cash to its destination.
Bitcoin consultant Kristov Atlas said the soaring in price pointed to the popularity of the privacy feature and was not a possible bubble.
“It’s not purely a speculative bubble. There’s some solid indications the market price is currently based on the fundamental value of the coin,” Atlas said.
Allen Price, a bitcoin trader added, “I had sort of smugly stood to the side waiting for the big, inevitable crash with an ‘I told you so’ ready. But no crash ever really came, and it’s been kind of an ongoing success for investors.”
Darkcoin is mined or generated more like the bitcoin, with miners having to engage in activity that’s tied to a particular computer function and processing capacity.
The currency adjusts value depending on exchanges between creators and darkcoin holders.
Evan Duffield, a 32 year old programmer in Arizona who launched darkcoin in January, said that much of the currency’s latest price hike can be attributed to its system of rewarding with darkcoins users who commit their machines to facilitation of darksend transactions, Wired reported.
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